Revenue Budget
Pay, allowances, stores, maintenance, and day-to-day running costs of the armed forces.
Functions
About Defence Finance
The financial architecture of India's defence establishment — from Parliament's budget allocation down to the field formation.
- ₹7.85L Cr
- Defence Budget 2026-27
- 311+
- Offices processing payments
- 14L+
- Personnel paid monthly
- 31L+
- Pensioners served
Structure
Defence Finance Hierarchy
The defence finance structure ensures accountability at every level, from Parliament's budget allocation down to unit-level expenditure.
Parliament — Defence Budget Allocation
Ministry of Defence — Secretary (Defence Finance) / FA(DS)
CGDA — Controller General of Defence Accounts
CDA / PCDA Offices — with IFAs at Commands & Formations
Overview
Role of Finance in Defence
Finance in defence ensures that public funds allocated to the armed forces are spent lawfully, efficiently, and with full accountability to Parliament. The Secretary (Defence Finance), also designated as Financial Adviser (Defence Services) or FA(DS), and the CGDA together constitute the defence finance structure.
The defence budget — among the largest allocations in the Union Budget — is subject to the same constitutional provisions and financial discipline as other government expenditure. Every rupee spent on defence must be accounted for, audited, and reported to Parliament through the Appropriation Accounts.
Financial advice
The IFA System
Integrated Financial Advisers are posted with Commands, Corps, and formations to provide real-time financial advice. The IFA examines procurement proposals, advises on financial propriety, and concurs on expenditure proposals up to delegated limits.
Proposal by unit
IFA examination
Concurrence / Observation
CFA decision
Expenditure
Audit
Delegation
Financial Powers at a Glance
Financial powers in defence are governed by the Defence Procurement Manual and the Schedule of Financial Powers (DFPDS). Powers are delegated in tiers — each tier has a Competent Financial Authority and a corresponding IFA.
| CFA Level | Authority | IFA Level | Governed By |
|---|---|---|---|
| Vice Chiefs / PSOs | Service HQ | Addl. CGDA / Pr. IFA | DPM / DFPDS |
| GOC-in-C / FOC-in-C | Command HQ | Jt. CGDA / Jt. IFA | DPM / DFPDS |
| GOC / Air Officer | Corps / Area | Dy. IFA / Sr. Dy. IFA | DFPDS |
| Brigadier / equivalent | Formation | ACDA / IFA | DFPDS |
| Commanding Officer | Unit | Through PAO | Unit Standing Orders |
Allocation
Defence Budget
The Union Budget allocates funds to the Ministry of Defence under Demand for Grants. The allocation flows through a defined chain — from MoD to Service HQ to Commands to units. The DAD tracks every transaction from allocation to expenditure to audit.
Capital Budget
Procurement of weapons, aircraft, ships, and major equipment. Land and construction.
Pension Budget
Pension for over 31 lakh defence pensioners. Administered through SPARSH by PCDA (Pensions).