Defence Economics & Industry

About Centre

India spends a significant amount of resources on its national defence. Efficiency in utilisation of resources is not only an economic imperative but vital for defence preparedness. In view of this, the Defence Economics and Industry Centre was created in 2006 to promote research on various economic aspects of India’s defence. Since its inception, the Centre has undertaken a number of policy relevant studies besides constantly engaging vital stakeholders (Ministry of Defence, Armed Forces and Industry) on a range of issues. The major focus areas of the Centre are:

Defence Acquisition
- Organisational and procedural improvement
- Offsets
Defence Industry
- Self-reliance in Defence Production
- Efficiency of Defence Public Sector Undertakings/Ordnance Factory Board
- Enhancing Private Sector Participation in Defence Production
Defence Research and Development
Defence Budget

Economics of Indo-US Nuclear Deal

With President Bush signing the India-US nuclear co-operation bill into law, critics and supporters of the bill have once again reinforced their stated positions over the future benefits and losses accruing to both countries as well as the world at large. While supporters have left no stone unturned in emphasising upon the strategic, bilateral and political importance of the bill, critics have flatly described it as an 'historical mistake' which will hound efforts to curb nuclear proliferation in years to come.

Impression on International Seminar on Defence Finance and Economics

The recently concluded three-day international seminar on Defence Finance and Economics, organised by the Indian Ministry of Defence (Finance) in New Delhi, covered a wide variety of issues concerning defence finance and economics and reflected on varied perspectives and practices from across the globe. The seminar was of particular importance because of the involvement of policy makers, academics, and other experts from think tanks and the media, in exchanging and discussing their views in the realm of the changing business and spectrum of defence worldwide.

The Indian Navy’s Amphibious Leap: ‘With A Little Help From America’

It remains to be seen how the USA would "help India become a major world power" as the US Secretary of State stated a year ago, but Washington is certainly contributing to augment India's trans-national military reach in terms of its amphibious sealift and airlift capabilities. Last year, the US agreed in principle to sell India its Austin-class LPD (Landing Platform Dock) USS Trenton at a cost of US$ 42 million. The 17,000-ton Trenton is still in commission with the US Navy and is presently being refitted at Norfolk, Virginia.

Defence Budget 2006-07

The Indian defence budget for FY 2006-07 is Rs 89, 000 crore (cr). This is 7.23 per cent more than the budget in FY 2004-05. As a percentage of GDP, the budget is 2.29 per cent as against 2.39 per cent in the previous year. Taking the revised allocation of Rs 81, 700 at RE (Revised Estimate) stage in FY 2004-05, the increase is 8.94 per cent.

Pravin Joshi
March 07, 2006
IDSA Comments

Defence outlay-modest increase but shades of gray

The defence expenditure (DE) announced today is Rs. 83,000 crores and this is a modest increase of Rs 6,000 crores or 7.7% over last year’s budgeted estimate (BE).