Former Army chief V P Malik told PTI that while neighbours like China and Pakistan are getting a military budget of more than three% of the GDP, India is still lagging behind the two% mark.
"China has more than 3%, it has about 3.5%. Pakistan has 4.5%. We also have been demanding that it should be 3% but it is in fact going down," he said.
The Defence Ministry was allocated Rs 2,03 lakh crore for 2013-14 which is barely Rs 25,169 crore more from last year's revised estimate of Rs 1.79 lakh crore.
In terms of GDP, this year's Budget allocation for defence is down from last year's 1.90% to 1.79%.
Factors like delay in procurement and inflation are not being taken into account while allocating funds for defence forces, Malik said.
"Inflation too has not been accounted for and nobody takes care of the deficiencies which have come into the forces over the years. So if you look at it, the Budget today has no meaning at all," he said.
Asked whether it will impact the preparedness of the defence forces, Malik said, "Of course it will impact our operational preparedness. It may not have its impact immediately but it will surely have mid and long-term impact."
Retired Lt Gen R K Sawhney termed the allocation "grossly inadequate" and underlined the need for being militarily prepared.
"It is going to impact. It is grossly inadequate. All the factors such as delays in procurement and less finance will of course impact our operational factor. It will have its adverse impact for a long time to come," Sawhney said.
Keeping in mind the current environment India cannot afford not to be militarily prepared, he added.
Similarly, Delhi-based defence analyst and CEO of Indicia Research and Advisory Deba R Mohanty said the trend of defence allocation in India has been disappointing.
"When there is a demand for increasing share of defence budget in relation to national GDP, the trend is actually showing otherwise. As far as India is concerned this is disappointing," he said.