it’s not the defence budget that matters, rather how much more can be procured with what ever budget is available. This issue is being addressed thru make in India, so far so good.
As for your point on maintaining troops both on LAC & LOC at the same time, its not a matter of choice, since they have been imposed on us by our adversaries. Given that there not much choice Instead of viewing it as a disadvantage , might as well view it as an opportunity to buy more from domestic companies and build the private domestic MIC. The procurement and advancement that can done using Pakistan as an excuse has almost reached it’s limit, might as well use PLA as a excuse to modernise the forces even more.
spending money on military modernisation and forward deployment also helps the GDP numbers and distribution of monies among the suppliers.