A close look at the Indian government’s defense budget and related reports on military matters shows that while external security preparedness has slipped over the years, the Indian army has become one of the busiest peace time forces fighting its own people. This also impacts on the morale of the armed forces and creates opportunity for the emergence of particularist biases and prejudices within the forces. The changing geopolitical context of India’s neighbourhood determines security perceptions and is a factor in deciding defense spending.