ABSTRACT
The defence budget presented by Union Finance Minister Pranab Mukherjee on 28 February 2011 saw an increase in India’s defence allocation for 2011-12 by almost 12 per cent to INR 1.64 trillion. This hike of almost 12 per cent in defence budgetary allocations compared to 4 per cent in 2010-11 was aimed at rapid modernisation of the Indian army, navy and the air force. It also reflected New Delhi’s emphasis on a two-pronged strategic approach: ensuring a more secure northern border which it shares with China and Pakistan and maintaining a greater presence in the Indian Ocean. An important feature of the defence budget was that the defence capital acquisition for the financial year 2011-12 was hiked to INR 550 billion while capital expenditure as a whole was raised by about 12 per cent to INR 691.99 billion, a move expected to provide a sizeable boost to the ongoing military modernisation programme.1
