India Defense Report
July 1, 2023
India’s defense budget in 2023, excluding defense pensions, stands at $56.8 billion, an increase of 3.5% from the pre-vious year. India’s defense budget is expected to increase from $67.5 billion in 2024 to reach a value of $89 billion in 2028. This growth reflects a CAGR of 7.2% of the period 2024-28.
A large part of India’s defense spending has been earmarked for financing revenue expenditures such as pensions, wages, and salaries and due to the increasing burden of non-productive revenue spending. The Indian Ministry of De-fense (MoD) has initiated several reforms to restructure military apparatus. Non-productive cost centers such as military farms and military dairy farms have been phased out, while efforts have been made to contain operational spending by introducing blended fuel vehicles and monetizing land holdings held by defense forces. Against this backdrop, the country's defense acquisition spending is anticipated to increase from $22.1 billion in 2024 to $27.9 bil-lion in 2028, reflecting a CAGR of 5.9%.