Defence Ministry Clears Rs 3.84 Lakh Cr Capital Acquisitions
Focus on modernisation, indigenisation and reforms to boost defence preparedness
New Delhi: The Ministry of Defence approved capital acquisition proposals worth Rs 3.84 lakh crore in 2025 to strengthen the country’s defence preparedness, with a strong emphasis on modernisation through indigenisation.
In the financial year 2025-26, up to the end of December 2025, the ministry signed capital procurement contracts worth Rs 1.82 lakh crore aimed at modernising the Armed Forces.
In a statement issued on Thursday, the defence ministry said that under the leadership of defence minister Rajnath Singh, significant progress has been made in implementing wide-ranging reforms to enhance jointness, improve defence preparedness, promote self-reliance, and strengthen welfare delivery mechanisms. These reforms, undertaken across the ministry, reflect a whole-of-government approach towards building a modern, integrated and future-ready defence ecosystem.
The ministry has achieved nearly 80 per cent expenditure, amounting to around Rs 1.2 lakh crore, under the Capital Acquisition Budget by the end of December 2025. This allocation has been utilised primarily for the modernisation of the Armed Forces. Overall capital expenditure of the ministry has reached 76 per cent, including spending on infrastructure, land acquisition and research and development, in addition to capital procurement.
To promote indigenisation and strengthen defence supply chains, the ministry has expanded private sector participation. Measures include streamlining defence manufacturing licences, mapping the capabilities of micro, small and medium enterprises, and preparing market intelligence reports to improve demand-supply assessment in defence procurement. Testing and trial infrastructure facilities are also being shared with private industry.
Further, about 25 per cent of defence research grants are being allocated to private industry, academic institutions and MSMEs to encourage innovation and enhance collaboration in the defence sector.
The procurement process has also been simplified to reduce timelines. Reforms include simplification of the iDEX manual, rationalisation of defence export permissions, revamping of the defence EXIM portal, simplification of the technology transfer policy, and decentralisation through revised delegation of financial powers and updated procurement manuals.
