Pune, May 30 (IANS): All three units of the armed forces were prepared to face any challenged, army chief Gen V.K. Singh said Wednesday, a day before he retires from office.

Addressing reporters at his last major function as army chief, V.K. Singh said modernisation would help the forces further build their capacity.

He was replying to questions at a press conference after the National Defence Academy (NDA) passing out parade at Khadakvasla near Pune.

"All three units of the armed forces, in whichever condition they are, are fully prepared to face any challenge," V.K. Singh said.

"As they modernise, they will add to their capacity," he said.

The army chief was at the centre of a controversy when a letter, written by him to Prime Minister Manmohan Singh pointing out lack of ammunition with the army, was leaked to the media.

Earlier, addressing the cadets, the army chief stressed on upholding moral and ethical values.

"You should lead by the respect of the people you command. A correct mix of moral and ethical values is needed. Never let personal gains override your professional duty and responsibility. It's the harder right than the easier wrong that you have to pursue. Today, when India is surging high, there are exciting times ahead. You will lead the future," he said.