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February 27, 1999
Defence outlay up by 11 per cent, but little gain in real terms
The defence outlay for 1999-2000 rose marginally by 11 per cent to Rs456.94 billion, but the share of defence in the government's total expenditure fell from 15.40 per cent to 14 per cent.
Defence experts said the allocation is just enough to take care of the inflation.
The army's share increased from Rs220.78 billion to Rs239.24 billion, the navy's by Rs2.23 billion to Rs33.63 billion, and the air force's from Rs55.13 billion to Rs60.43 billion.
"Further need-based budgetary support will be provided during the year," Finance Minister Yashwant Sinha promised while presenting the Budget proposals.
The outlay for defence ordnance factories saw a drop from Rs2.82 billion to Rs1.34 billion.
The defence outlay in 1998-99 had seen a 14 per cent increase over the previous year.
Capital outlay on defence services increased to Rs122.3 billion from Rs101.87 billion. A major increase was made for army equipment, the outlay going up from Rs18.88 billion to Rs27.64 billion.
The outlay for research and development increased from the revised Rs5.7 billion last year to Rs7.16 billion.
The Indian Air Force's outlay for aircraft and engines rose from Rs27.15 billion to Rs32 billion.
The Budget has an outlay of Rs73.49 billion for defence pensions.
In his speech, Sinha said gallantry award winners will not have to pay income tax on their pension.
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