Proposal for the creation of a Non-Lapsable Defence Modernisation Fund under consideration

A proposal for creation of Non-Lapsable Defence Modernisation Fund (DMF) is under consideration with Ministry of Defence. DMF, in which the unspent defence capital budget is placed at the end of each financial year, from where it can be made available for the subsequent year’s procurements; will be available for modernization of Defence Forces and would supplement the regular yearly budgetary allocations by eliminating any uncertainty in provisioning of adequate funds for various defence capability development and infrastructure projects. A suitable mechanism for operationalising the fund is being worked out in consultation with the Ministry of Finance