The first of the two defence industrial production corridors, as announced in the Union Budget, will link Chennai and Bengaluru, Defence minister Nirmala Sitharaman said on Thursday. In his budget address, Finance Minister Arun Jaitley said the government will develop two defence industrial production corridors .

Sitharaman said that the first corridor will link Chennai and Bengaluru and will pass through Coimbatore and several other industrial clusters. “Announcement for the second corridor will be made soon,” she said. “The announcement by Jaitley has paved the way for setting up the first defence production corridor in Tamil Nadu. This shall provide impetus to the defence production industry in the country and in the region, in particular,” Sitharaman said.

Asked about the 7.81 per cent hike in the defence budget against the expectations of a higher increase, the defence minister said all the requests of the defence ministry were heeded by the finance minister, adding he had to take care of other priorities as well. It was a “reasoned out” defence budget, she said.

The defence budget was increased by 7.81 per cent to Rs 2.95 lakh crore against last year’s Rs 2.74 lakh crore, belying expectations of a significant hike when the armed forces are facing growing challenges on the borders with Pakistan and China.

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Sitharaman also welcomed announcements by Jaitley to bringing out a new defence production policy. The defence minister thanked Prime Minister Narendra Modi and Jaitley, saying various requests of her ministry were taken care of in the defence budget.