Budget 2026: Defence budget has declined, P Chidambaram breaks down UPA vs NDA numbers
Union Budget 2026: Defence expenditure as a proportion of total expenditure was 16 percent in 2013–14. In 2025–26, it has come down to between 14-14.5 percent of total expenditure, says Chidambaram
- Feb 1, 2026,
- Updated Feb 1, 2026 8:00 PM IST
Union Budget 2026: Former Finance Minister P Chidambaram on Sunday questioned the government's defence spending claims after the Union Budget 2026, arguing that defence expenditure has declined under the NDA when measured as a share of total spending and as a percentage of GDP.
Reacting to Finance Minister Nirmala Sitharaman's defence allocation for 2026–27, Chidambaram drew a direct comparison between the UPA and the NDA, saying the ratios tell a different story.
"Comparative expenditure under the UPA and NDA on defence. Let me tell you the numbers," he said. "Defence expenditure as a proportion of total expenditure was 16 percent in 2013–14. In 2025–26, it has come down to between 14 and 14.5 percent of total expenditure. As a percentage of GDP, we had touched 2.3 percent in 2013–14. This year, it is just below 2 percent. So, either as a proportion of GDP or as a proportion of total expenditure, it has come down between the UPA and the NDA," Chidambaram said.
Sitharaman has allocated Rs 7,84,678 crore for defence in 2026–27, marking a rise of 15% over last year’s allocation of Rs 6.81 lakh crore.
The defence allocation this year is focused on capability strengthening amid rising security challenges from China and Pakistan, and includes a higher capital outlay for procurement and modernisation.
Out of the total defence allocation, Rs 2,19,306 crore has been earmarked for capital expenditure for the armed forces, which largely includes purchases of new weapons, aircraft, warships and other military hardware. The capital outlay is 21.84% higher than the Budget Estimates for 2025–26. Under this head, Rs 63,733 crore has been set aside for aircraft and aero engines, while Rs 25,023 crore has been allocated for the naval fleet.
The total capital outlay is over Rs 39,000 crore higher than the current fiscal year's budgetary estimate of Rs 1.80 lakh crore. The revised capital outlay for 2025–26 has been estimated at Rs 1,86,454 crore. The defence ministry has also said that Rs 1.39 lakh crore, which is 75% of the capital acquisition budget, has been set aside for procurement through domestic industries during FY 2026–27.
According to the ministry, the allocation for defence stands at two per cent of the estimated GDP for the next financial year and shows an increase of 15.19% over the budgetary estimates for 2025–26. It also said the total defence budget is 14.67% of the Union government's planned expenditure in the next fiscal year, making it the highest among ministries.
Track live Budget updates, breaking news, expert opinions and in-depth analysis only on BusinessToday.in
Union Budget 2026: Former Finance Minister P Chidambaram on Sunday questioned the government's defence spending claims after the Union Budget 2026, arguing that defence expenditure has declined under the NDA when measured as a share of total spending and as a percentage of GDP.
Reacting to Finance Minister Nirmala Sitharaman's defence allocation for 2026–27, Chidambaram drew a direct comparison between the UPA and the NDA, saying the ratios tell a different story.
"Comparative expenditure under the UPA and NDA on defence. Let me tell you the numbers," he said. "Defence expenditure as a proportion of total expenditure was 16 percent in 2013–14. In 2025–26, it has come down to between 14 and 14.5 percent of total expenditure. As a percentage of GDP, we had touched 2.3 percent in 2013–14. This year, it is just below 2 percent. So, either as a proportion of GDP or as a proportion of total expenditure, it has come down between the UPA and the NDA," Chidambaram said.
Sitharaman has allocated Rs 7,84,678 crore for defence in 2026–27, marking a rise of 15% over last year’s allocation of Rs 6.81 lakh crore.
The defence allocation this year is focused on capability strengthening amid rising security challenges from China and Pakistan, and includes a higher capital outlay for procurement and modernisation.
Out of the total defence allocation, Rs 2,19,306 crore has been earmarked for capital expenditure for the armed forces, which largely includes purchases of new weapons, aircraft, warships and other military hardware. The capital outlay is 21.84% higher than the Budget Estimates for 2025–26. Under this head, Rs 63,733 crore has been set aside for aircraft and aero engines, while Rs 25,023 crore has been allocated for the naval fleet.
The total capital outlay is over Rs 39,000 crore higher than the current fiscal year's budgetary estimate of Rs 1.80 lakh crore. The revised capital outlay for 2025–26 has been estimated at Rs 1,86,454 crore. The defence ministry has also said that Rs 1.39 lakh crore, which is 75% of the capital acquisition budget, has been set aside for procurement through domestic industries during FY 2026–27.
According to the ministry, the allocation for defence stands at two per cent of the estimated GDP for the next financial year and shows an increase of 15.19% over the budgetary estimates for 2025–26. It also said the total defence budget is 14.67% of the Union government's planned expenditure in the next fiscal year, making it the highest among ministries.
Track live Budget updates, breaking news, expert opinions and in-depth analysis only on BusinessToday.in