India's federal government has announced a INR3.19 trillion (USD 44.6 billion) defence budget for fiscal year 2019/20 (FY 2019/20), which represents an increase of 6.87% or INR205.12 billion compared to the previous year.
However, military officers and Ministry of Defence (MoD) officials told Jane's that the increase, which was announced by Finance Minister Piyush Goyal on 1 February, equals only 1.52% of India's GDP and is therefore "grossly insufficient" to "adequately" modernise the country's military.
They added that the increase in defence spending would be "largely counterbalanced" by the rapidly declining value of the Indian rupee and rising inflation.
"The government appears to have focused more on programmes that will help to re-elect it in the upcoming general elections than on allocating funds to modernise the defence forces," said Amit Cowshish, a former financial advisor for acquisitions at the MoD.
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