75% of defence capital outlay for procurement from domestic industries

India will spend 75 per cent of the total defence capital outlay for procurement from domestic defence manufacturers in 2023-24, Defence Minister Rajnath Singh said on Wednesday in a significant decision aimed at boosting the indigenous production of various weapons and military platforms. The move will mean setting aside of around Rs one lakh crore for procurement from domestic sources out of the total defence capital outlay of Rs 1,62,600 crore announced in the Union Budget for the next fiscal, officials said. According to official data, the value of India’s indigenous defence production from 2019-20 to 2021-22 was Rs 2.58 lakh crore. In 2020-21, the government had set aside 58 per cent of defence capital outlay for procurement from the Indian defence industry which was increased to 64 per cent in 2021-22. The allocation was further enhanced to 68 per cent in 2022-23. Officials said over 250 business-to-business pacts and MoUs were firmed up at Aero India which are estimated to unlock investment to the tune of over Rs 79,000 crore. The defence minister made the announcement of increasing the allocation further at an event where several agreements and technology transfer pacts were firmed up among a large number of defence companies which participated in Aero India 2023.