Are our politicians losing interest in India’s defence?
Given India’s increasing vulnerabilities and international demands to act as a net provider of security as a rising regional power, the defence allocation and expenditure needs to be supplemented to create the capabilities which the armed forces will need
The Parliamentary Standing Committee on Defence, headed by Bharatiya Janata Party (BJP) Member of Parliament Major General B.C. Khanduri (Retd), has recently conveyed to the Parliament that the “growth in the budgetary allocation for defence is not sufficient and woefully inadequate for modernisation.” This assessment cannot be a surprise to anyone, except those who have stopped taking interest in India’s defence requirements.
After Kargil war, during which I made that famous statement: “We shall fight with whatever we have”, India’s defence budget was raised to 2.41 per cent of its GDP. Since then, there has been a steady downslide, to 1.47 per cent this year, not counting the thousands of crores surrendered by the Ministry of Defence (MoD) near annually.
So the Defence Secretary G. Mohan Kumar was absolutely right when he admitted before the parliamentary panel that India’s military spending for financial year 2016-17 is not as per the requirements of the services.
A question linked to the above-mentioned observation would be, “Are the government and political parties losing interest in India’s defence?”
I believe so: not only the National Democratic Alliance (NDA) regime but all political parties seem to be losing interest in India’s defence matters when one notices that only 10 out of 24 political parties had given their views in this report of the Parliamentary Standing Committee on Defence.
As an armed forces veteran, I noticed two firsts in the annual budget presented to the Parliament this year.
First, the Finance Minister Arun Jaitley never mentioned the word ‘defence’ in his speech. I cannot recall that happening in the last five decades or more. In the budget 2014-15, there was a cryptic reference to the ‘Make in India’ programme in defence selfreliance. This year, there was not even that. To many people, this lack of mention would have conveyed the impression that India’s security and ` 3,40,000 crore of India’s defence budget (total defence outlay plus the pensions bill) is of little importance.
Second, for the first time, the Finance Minister included ‘defence pensions’ as part of Defence Ministry Allocation (Item No. 21 in the Summary of Demands for Grant). Till now, military pensions were never a part of defence budget. It was a sepa- rate allocation. The Finance Minister included this expenditure as part of the defence budget probably for two reasons: to convey that this particular item has impacted the rest of defence allocation (military pensions are likely to increase from ` 60,238 crore in financial year 2015-16 to ` 82,332 crore in financial year 2016-17), and to convey that total defence outlay has been increased substantially. What is the actual defence allocation for this year? What are its implications for the armed forces? Let me analyse and state my views.
The defence allocation sought in the budget estimate (BE) for the financial year 2016-17 is: Revenue — ` 1,48,498.85 crore, Capital — ` 78,586.68 crore, Pensions — ` 82,332.66 crore, Miscellaneous (other than armed forces) — ` 68,537.63 crore. On the basis of BE of last year, there is an increase of mere 1.16 per cent. This allocation does not even cover India’s inflation rate and will be insufficient to fulfil military’s basic needs, let alone its modernisation.
In the financial year 2015-16, MoD was unable to spend ` 18,295 crore out of its allocated budget. This included ` 11,595 crore from the Capital expenditure, or 13.4 per cent of the funds earmarked to purchase new military equipment. The rest unspent amount was from Revenue expenditure, mostly maintenance requirements of the military.
For the unspent money, which leads to reduction in the revised estimates (RE) year after year, we can blame the MoD for its cumbersome procedures, and also its Finance Adviser who takes his cues on curtailing defence expenditure from the Ministry of Finance. Usually, he is seen to be more loyal to his parent ministry than the one in which he is located.
For the financial year 2016-17, the capital expenditure outlay for the armed forces is ` 78,586.68 crore. Last year, at the BE stage, it was ` 85,894.44 crore. This clearly implies lesser money for modernisation this year. Of the allocated amount, more than 80 per cent funds are expected to be paid for deals which have already been signed.
Lack of funds will force the MoD to cancel several projects, and even withdraw some already floated tenders. The delays in the replacement of the army’s obsolescent weapons and equipment, making up of deficiencies in fighter squadron strength of the air force and the submarine fleet of the navy