Increase capital expenditure, if the armed forces are to be truly modernised
At the recently concluded Defexpo 2014, the Defence Minister A.K. Antony conceded that the government was left with no alternative but to divert nearly ` 7,900 crore from the capital expenditure to revenue expenditure to meet the inevitable requirements of salaries and maintenance costs and that this had added to the delay in acquisitions of defence equipment. Antony also had thrown the ball in the court of the armed forces stating that they needed to prioritise on acquisitions. Similar exhortation had come earlier from the Prime Minister Dr Manmohan Singh.
The Finance Minister P. Chidambaram in the interim budget announced a meagre hike of 3.2 per cent in the capital outlay, from ` 86,740 crore to ` 89,587 crore, and this, experts believe, will not be of much help in speeding up the pace of modernisation of the armed forces. There is a backlog of orders, including the mother of all deals – the medium multi-role combat aircraft (MMRCA), which need to be fulfilled. And if the government is keen on pushing through some of the key defence acquisition programmes, whether it is from domestic or overseas sales, it has to make enough financial provisions and it cannot be on an ad hoc basis.
This point was loud and clear at Defexpo 2014 where not just Indian manufacturers, but also overseas, were keen that the government facilitated partnerships, collaborations etc as to help India achieve its goals of modernisation of the armed forces and indigenisation of defence equipment, which presently relies heavily on imports (over 70 per cent). Interestingly, there were more number of foreign exhibitors at Defexpo this year which is indicative of their keen participation not just as ‘sellers’ but also as ‘partners’ and all of them profess that they are here for the long haul.
It was indeed heart-warming to notice the dominating presence of Indian companies at the show. For instance, the Tata Group was omnipresent, while other major players such as L&T, Mahindras, Kalyani Group, BEL, DRDO, HAL, the various public sector shipyards and many others were in full strength. With the opening up of the defence industrial base to private sector, there is frenetic activity. However, the government has to provide the necessary policy push and we see that happening in spurts. It is understandable, considering that we are gradually coming out of a closed regime in defence production/acquisition.
In his fortnightly viewpoint, Lt General (Retd) P.C. Katoch has opined that no country can be militarily strong when 77 per cent of defence requirements are met through imports. The way forward is collaborations, partnerships, joint ventures, etc.
We at SP Guide Publications are on a similar course. We have been partnering with various industry bodies such as the Federation of Indian Chambers of Commerce and Industry; the Confederation of Indian Industry and others to help promote business opportunities in defence and aviation. As we celebrate our Golden Jubilee and pay tribute to our founder late Shri Sukhdeo Prasad Baranwal, we assure our esteemed readers that we will continually improve and expand our reach.
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