FIVE BIG CHALLENGES
THINGS TO DO TO MAKE INDIA’S MILITARY 21ST CENTURY-READY
1 INCREASE DEFENCE BUDGETS
The armed forces are caught in a pincer of rising costs and stagnant budgets. Manpower costs surged from 44% in 2011 to 56% in 2019, while capital procurement—money spent on buying equipment—dipped from 26% to 18%. Budgets have maxed out, and the government is unlikely to spend any more than the current 18% spend. But in pre-budget presentations before the finance ministry, the armed forces projected a requirement for an additional Rs 1.5 lakh crore.
Stagnant defence budgets could be an ideal opportunity to push reform, prioritise jointmanship, merge commands and trim expenditure. Several reform committees have recommended drastic steps. The last, the Lt Gen. Shekatkar committee, suggested savings of up to Rs 25,000 crore over five years.
3 MAKE IN INDIA
This flagship scheme suffered for a lack of orders, and because the majority of the defence deals were not placed with indigenous private sector firms. The MoD needs to promote product-based development and fund Indian Designed Developed and Manufactured products. Rather than enhance capacity, it needs to utilise existing production lines through Government Owned, Corporate Operated models.
4 JOINT PRODUCTION
Defence offsets, which mandate foreign equipment sellers to reinvest 30-50% of a defence deal by sourcing equipment and services within India, have failed. In the AgustaWestland VVIP helicopter deal, they were a means of rerouting bribes into India. The MoD needs to find a way in which defence vendors collaborate with Indian firms to set up manufacturing bases within India.
5 STRATEGIC PARTNERSHIPS
The MoD’s 2017 Strategic Partnerships (SP) model envisoned India’s private sector teaming up with global equipment manufacturers to produce fighter aircraft, submarines, helicopters and battle tanks. The programme is two years behind schedule; of the four planned SPs, only two—production of 111 Naval Utility helicopters and six Project 75I advanced conventional submarines—have cleared the first stage.