It has been reported that with Europe facing a debt crisis, Italy's government looks set to slash 10 percent off its defense budget.

The prescribed cut is due to hit the Defense Ministry in 2011 and could imperil the top-up funds Italy's armed forces receive from the Industry Ministry and other sources.

It was also reported that the measures come as NATO Secretary-General Anders Fogh Rasmussen has warned against drastic defense cuts, saying they could threaten international stability and limit growth prospects.

Rasmussen told The Times of London, "All governments should be aware of the long-term impact of too deep cuts in defense budgets because we know from experience that economic growth is very much dependent on a secure international environment. We know that instability and insecurity hamper economic growth. So if we make too deep cuts in defense budgets it might have a long-term negative impact on economic growth."

Italy isn't the only nation member drawing battle plans to attack its defense budget. Greece and Portugal, the weakest financial links in the single European currency, have announced draconian cuts.

The media reports further noted that those measures precipitated Britain, France, Denmark and Italy to consider similar action in a bid to curb public spending.

The austerity measures in Italy, intended to save $29.4 billion, are expected to have a sweeping impact on the salaries of defense officials. (With Inputs from Agencies)