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India Defence Budget 2026-27 Explorer: Allocation, Trends & Breakdown

Understand where India's defence money goes — allocation, trends and priorities from 2020-21 to 2026-27, with an interactive calculator.

Updated 24 Oct 2026 · By Defence Pulse – भारतीय रक्षा समाचार और ताज़ा खबरें Desk

Defence Budget 2026-27 at a Glance

Total MoD allocation₹7,84,678 crore≈ ₹7.85 lakh crore

Capital outlay₹2,19,306 crore27.9% of total

Growth vs 2025-26 BE+15.19%Record allocation

Share of Union spending14.67%Largest of any ministry · about 2% of GDP

Head (2026-27)	Share	Amount (approx.)
Capital outlay (modernisation)	27.95%	₹2,19,306 crore
Pay & allowances	26.40%	₹2,07,155 crore
Defence pensions	21.84%	₹1,71,374 crore
Revenue: sustenance & operations	20.17%	₹1,58,270 crore
Civil organisations	3.64%	₹28,562 crore

Source: Union Budget 2026-27 documents (Ministry of Finance) and Ministry of Defence/PIB releases. Amounts per head are calculated from the published percentage shares and may differ slightly from line-item totals.

Year-wise Trend: 2020-21 to 2026-27

Total allocationCapital outlay

4.71 1.14

2020-21

4.78 1.35

2021-22

5.25 1.52

2022-23

5.94 1.63

2023-24

6.22 1.72

2024-25

6.81 1.80

2025-26

7.85 2.19

2026-27

Figures in ₹ lakh crore, Budget Estimates (BE).

Year (BE)	Total allocation	YoY growth	Capital outlay	Capital share
2020-21	₹4,71,378 crore	—	₹1,13,734 crore	24.1%
2021-22	₹4,78,196 crore	+1.4%	₹1,35,060 crore	28.2%
2022-23	₹5,25,166 crore	+9.8%	₹1,52,369 crore	29.0%
2023-24	₹5,93,538 crore	+13.0%	₹1,62,600 crore	27.4%
2024-25	₹6,21,541 crore	+4.7%	₹1,72,000 crore	27.7%
2025-26	₹6,81,210 crore	+9.6%	₹1,80,000 crore	26.4%
2026-27	₹7,84,678 crore	+15.2%	₹2,19,306 crore	27.9%

Between 2020-21 and 2026-27, India's defence allocation grew from ₹4,71,378 crore to ₹7,84,678 crore — a compound annual growth of about 8.9%. Capital outlay, the money used to buy new aircraft, ships, missiles and equipment, rose from ₹1,13,734 crore to ₹2,19,306 crore over the same period.

Interactive Budget Calculator

Choose a year to see what the defence budget means per day and per citizen.

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Understanding the Defence Budget

What is capital outlay?

Capital outlay is the money used to create long-term assets: new fighter jets, warships, submarines, tanks, artillery, missiles, radars and infrastructure. In 2026-27 it stands at ₹2,19,306 crore, the highest ever and over a fifth more than the previous year. Within this, the government earmarked roughly ₹1.85 lakh crore for capital acquisition (modernisation of the three services), with large heads for aircraft and aero-engines and for the naval fleet.

What is revenue expenditure?

Revenue spending keeps the forces running day to day — salaries and allowances, fuel, ammunition, spares, maintenance, rations and training. Pay and allowances alone take about 26% of the total, while sustenance and operational readiness take about 20%.

Why are pensions so large?

India has one of the largest veteran populations in the world. Defence pensions, including One Rank One Pension (OROP) revisions, now take roughly 22% of the Ministry of Defence allocation. Because pensions and salaries are fixed commitments, the share left for modernisation is closely watched by analysts.

What changed in 2026-27?

Total allocation crossed ₹7.8 lakh crore, about 15.19% higher than the previous year's Budget Estimate.
Capital outlay rose to about ₹2.19 lakh crore, increasing the capital share to nearly 28% of the total.
Defence remains the single largest ministry allocation, at about 14.67% of central government expenditure.
The emphasis continues on indigenous procurement under Aatmanirbhar Bharat, with a large part of the modernisation budget reserved for domestic industry.

All figures are Budget Estimates (BE) as presented in Parliament. Revised Estimates (RE) and actual spending can differ. Official documents: indiabudget.gov.in · mod.gov.in

Frequently Asked Questions

What is India's defence budget for 2026-27?

India's Ministry of Defence has been allocated ₹7,84,678 crore (about ₹7.85 lakh crore) in the Union Budget 2026-27, around 15.19% more than the previous year's Budget Estimate.

How much is the capital outlay for defence in 2026-27?

The capital outlay for the Defence Forces is ₹2,19,306 crore, which is used for buying new weapons, platforms and infrastructure. It is about 27.9% of the total defence allocation.

What percentage of the Union Budget goes to defence?

Defence gets about 14.67% of the central government's total expenditure in 2026-27, the largest share of any ministry, and roughly 2% of GDP.

How much does India spend on defence pensions?

Defence pensions account for about 21.84% of the Ministry of Defence allocation in 2026-27, or roughly ₹1,71,374 crore.

What is the difference between capital and revenue defence expenditure?

Capital expenditure creates long-term assets such as aircraft, ships and missiles. Revenue expenditure covers recurring costs such as salaries, fuel, ammunition, spares and maintenance.