NEW DELHI: Indian Defence Minister AK Antony told Rajya Sabha he would seek a hike in the Rs 1,93,408 crore (around $39 billion) defence outlay in the 2012-13 budget due to "new ground realities and the changing security scenario", Indian media quoted.

"The growing proximity of China and Pakistan is a cause of worry...I know the gravity of the situation. We have to take a second look at the defence budget in light of the changing threat perceptions,'' he said.

The armed forces had sought a defence outlay of Rs 2,39,123 crore this fiscal that would have amounted to 2.35% of the projected GDP for 2012-13, but ultimately got only Rs 1,93,408 crore to notch up 1.9%.

Now, after Gen VK Singh's warning about "critical hollowness" in the Army's operational capabilities to deal with two "inimical neighbours", the government is doing a serious rethink. "The defence budget has to be enhanced to deal with the new challenges," said Antony.

This came after opposition leader Arun Jaitley stressed the importance of shaping India's strategic policy and defence preparedness as per "changing geo-strategic realities". Though he was "almost sure" there would be no conflict, Jaitley said India had to be prepared for a "90-day full spectrum war". "How do we defeat Pakistan and how do we hold China? All this has to be factored in," he said.

Antony acknowledged there was need to "speed up" several plans already underway to boost operational military capabilities as well as border infrastructure through strategic road and rail links. "If China can increase its military strength in Tibet, India can do the same in Arunachal, Sikkim and other areas," he said.