De­fence Sec­tor Sees Mod­est Hike of 6%

The Economic Times - - Front Page - Manu.Pubby@ times­group.com

New Delhi: A mod­est 6% hike in al­lo­ca­tion shows that de­fence spend­ing re­mains a low pri­or­ity area for the gov­ern­ment. The hike is un­likely to meet the im­pactofin­fla­tion,de­pre­ci­a­tion of the ru­pee and the im­po­si­tion of cus­toms duty on mil­i­tary im­ports from last year.

Pegge­dat1.62%oftheGDPthis year, the al­lo­ca­tion is un­likely to cater for ma­jor weapons pur­chases. This is de­spite the rec­om­men­da­tion of a key de­fence min­istry­pan­elthatthes­pend­ing should be 2.5% of the GDP.

“The fact that all de­fence im­ports now at­tract cus­toms duty and the ru­pee has de­pre­ci­ated against the dollar, it will be in­ter­est­ing to see how the large pend­ing pro­cure­ments go ahead,” said Ankur Gupta, vice-pres­i­dent, aero­space & de­fence at EY In­dia. (BE) (RE) (BE) (RE) (BE) (BE) (RE) (BE) (ET) (BE) (BE) (BE) (BE) ET: Ear­lier Tar­get

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