Budget 2014 FOCUS : Govt raises military spending, eases foreign investment limit in arms industry

India boosted defence spending by 12 percent in 2014-15 over the previous year in the budget. Finance Minister Arun Jaitley set the military budget at 2.29 trillion Indian rupees ($38.35 billion) for 2014-15, 50 billion rupees more than what the previous government agreed in an interim budget earlier this year. It further opened the domestic weapons industry to foreign investment to help rebuild the military and narrow the gap with China.India has been the world’s top arms buyer for the last three years, trying to replace an ageing Soviet-era military with modern weapons as a deterrent to a rising China, with which it fought a war more than half a century ago.

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