New Delhi: India has announced a sharp increase in defence and infrastructure spending in its latest national budget, raising defence outlays by about 15 percent as the government prioritises military modernisation amid ongoing regional security tensions.

Presenting the budget in parliament on Sunday, Finance Minister Nirmala Sitharaman said New Delhi plans to spend around $85 billion on defence and $133 billion on infrastructure, marking year-on-year increases of roughly 15 percent and nine percent, respectively. The allocations include funding for high-speed rail, submarines, fighter jets and other large-scale projects.

According to budget documents cited by Bloomberg, India will raise spending on new military hardware by nearly 18 percent in the financial year starting April 1. Capital expenditure for defence has been set at about 2.2 trillion rupees ($23.9 billion), up from around 1.86 trillion rupees in the current fiscal year.

Sitharaman told lawmakers that public spending on infrastructure has risen sharply over the past decade, increasing from about $21 billion in 2014–15 to what she described as an all-time high. She added that the government would also support investments in data centres, artificial intelligence, and the mining and processing of rare earths.

Defence Minister Rajnath Singh described the latest defence allocation as unprecedented, saying it would help equip India’s armed forces with fighter jets, drones, ships, submarines and other critical hardware. He said the increased spending was in the country’s national interest.

The budget signals New Delhi’s continued focus on strengthening defence capabilities alongside infrastructure development, as India seeks to modernise its economy while addressing evolving security challenges.