FICCI Demands Defence Budget Hike For 'Atmanirbharta' Amid Global Threats
Overview
FICCI urges Finance Minister Nirmala Sitharaman to prioritize defence capital expenditure in Budget 2026, advocating for increased self-reliance through technology-driven innovation. Citing global uncertainties and adversaries' advancements, FICCI proposes a 30% capital outlay share, a ₹10,000 crore boost for DRDO, and initiatives like an Eastern Defence Corridor to bolster India's security and export capabilities.
FICCI Pushes for Enhanced Defence Budget in 2026
FICCI has called on Finance Minister Nirmala Sitharaman to prioritize capital expenditure for the defence sector in the upcoming Union Budget 2026. The industry body emphasizes the need for 'Atmanirbharta' (self-reliance) through modern, technology-driven approaches amidst escalating global uncertainties and geopolitical disputes. India faces adversaries investing heavily in advanced military technologies, making a robust defence architecture critical for territorial integrity and strategic autonomy.
A Four-Pronged Strategic Approach
The Federation of Indian Chambers of Commerce & Industry (FICCI) outlined a four-point agenda for Budget 2026 to bolster India's defence capabilities. This strategy moves beyond mere platform enhancements, focusing on future warfare which will be technology-driven, multi-domain, and information-centric. It advocates a shift towards networked, integrated, and AI-enabled capabilities, backed by indigenous innovation.
Increasing Capital Outlay and DRDO Funding
While the Ministry of Defence received approximately ₹6,81,210.27 crore in Budget 2025, a rise of 9.53%, FICCI suggests maintaining this growth trajectory. Crucially, it recommends increasing the share of capital outlay within this budget to 30%, up from around 26%. This additional funding is intended for modernizing infrastructure and investing in frontline assets like UAVs, counter-UAV systems, and electronic warfare capabilities.
Furthermore, FICCI proposes a significant ₹10,000 crore increase in the allocation for the Defence Research and Development Organisation (DRDO). This boost aims to strengthen DRDO's capacity for developing frontier technologies, fundamental research, and deep technology in collaboration with private entities, thereby fostering greater indigenous defence capabilities.
Fostering Indigenous Corridors and Exports
Building on the Atmanirbhar Bharat initiative, FICCI supports the establishment of Defence Industrial Corridors. It specifically advocates for an Eastern India Defence Industrial Corridor, synchronized with the 'Purvodaya Scheme'. This initiative is expected to stimulate industrial growth, R&D, and job creation in Eastern India, positioning the nation as a global defence export hub.
The industry body also highlighted the impressive 46% compound annual growth rate in defence exports between 2016-17 and 2023-24, largely driven by private firms. FICCI recommends establishing a dedicated Defence Export Promotion Council (DEPC) to streamline coordination among various stakeholders, including armed services, private manufacturers, and foreign governments, to further boost India's defence export targets.
