New Delhi: The allocation for the defence sector under the Union Budget 2020-21 has witnessed a nearly 6% increase over the previous fiscal. The Budget now stands at Rs 3,37,553 crore. Apart from this, a sum of Rs 1,33,825 crore has been set aside for the payment of pensions. Even at this level, the allocation remains at around 1.5% of the Gross Domestic Product and is at the lowest witnessed since the 1962 Indo-China war.Defence remains biggest single ‘item’ of expenditureThough the Budget speech of Union finance minister Nirmala Sitharaman did not make any mention of the government’s expenditure on defence, the Budget documents spelt out that the total spending on the sector, including pensions, would stand at Rs 471,378 crore and would constitute the single highest in terms of “expenditure of major items”.Only four other category of expenditures crossed the Rs 1 lakh crore mark – and these related to the ministries of rural development at Rs 1.22 lakh crore, consumer affairs, food and public distribution at Rs 1.24 lakh crore, agriculture and farmers’ welfare at Rs 1.42 lakh crore, and home affairs at Rs 1.67 lakh crore.While in this Budget, the first for a full financial year in the Narendra Modi government’s second term, it was expected that more funds would be set aside for the modernisation of the armed forces and acquisition of new equipment, ships, aircraft and other hardware, the allocation did not exactly meet the aspirations.Capital expenditure to rise by around Rs 10,000 croreAccording to the Notes on Demand for Grants, 2020-2021, the proposed capital outlay on defence services, which primarily covers procurement of assets, this time the proposed amount is Rs 1,13,734 crore, around Rs 10,000 crore more than the figure in 2019-2020.The revenue expenditure on defence services for the coming year has been proposed to be Rs 2,09,319 crore, around Rs 7,418 crore more than the allocation in the previous financial year.Similarly, the revenue expenditure on Ministry of Defence (Civil) has been proposed to be Rs 9,679 crore and the capital expenditure at Rs 4,821 crore, taking the total to Rs 14,500 crore. The total allocation under the two heads during 2019-20 was Rs 13,635.15 crore.While these three heads constitute the main budget for defence, the expenditure on pensions continues to remain a big source of outgo.Pension payment to take up an extra Rs 21,000 croreThe revenue expenditure on defence pensions for 2020-21 has been proposed at Rs 1,33,825 crore, an increase of over Rs 21,000 crore over the Rs 1,12,079.57 crore allocation in the previous financial year.The expenditure on pensions would cover payment of service pension, gratuity, family pension, disability pension, commuted value of pension and leave encashment. The Centre said the higher requirement is mainly due to increase in number of pensioners and impact of dearness relief.As far as different heads go, under Defence Services (Revenue) the establishment expenditure of the Centre on Army was Rs 1,41,501.19 crore in Budget 2019-2020. It has gone up by around Rs 5,000 crore to reach Rs 1,46.940.51 crore in the upcoming fiscal.Similarly, for Navy the revenue expenditure is proposed to go up by nearly Rs 700 crore from Rs 22,211.71 crore to Rs 22,934.75 crore in the coming year. For the Air Force, the increase would be of nearly Rs 450 crore and the total allocation for revenue will increase from Rs 29,501.69 crore to Rs 29,952.66 crore.Likewise, the provision for a marginal increase in revenue expenditure for Defence Ordnance Factories and for Research and Development has been made in the Union Budget 2020-21.