The government has said the defence budget as a percentage of the Gross Domestic Product (GDP) may appear to be falling due to a rising trend of India’s economic growth. In the Union budget, the government had allocated Rs 2.95 lakh crore to defence forces which is estimated to be around 1.58% of the country's GDP. A separate amount of Rs 1.08 lakh crore was set aside for the paying pension to defence personnel. This defence budget, in terms of percentage of the GDP, was lowest since 1962.
Minister of State for Defence Subhash Bhamre has said that the defence budget, including allocation for miscellaneous expenditure and pensions, was Rs 4.04 lakh crore, which is 16.6% of total expenditure of government for the year 2018. He also said that capital budget of ministry of Defence for 2018-19 is approximately 33% of the total capital expenditure of the central government.
Bhamre further said that allocated budgetary resources are optimally utilised towards meeting the operational requirements of the armed forces. He also said that depending upon the allocated resources schemes are also reprioritised to ensure that urgent and critical capabilities are acquired without compromise of operational preparedness.