Bud­get short­fall wor­ries De­fence Ser­vices

May de­rail ca­pac­ity en­hance­ment, mod­erni­sa­tion and main­te­nance un­der way; ma­jor deals com­ing up

The Hindu - - NEWS - Di­nakar Peri

The short­fall in de­fence al­lo­ca­tion in the in­terim Bud­get 2019-20, es­pe­cially in its cap­i­tal al­lo­ca­tion, has left the Ser­vices wor­ried as it threat­ens to de­rail the ca­pa­bil­ity en­hance­ment and mod­erni­sa­tion un­der way. This comes at a time of fast-paced de­vel­op­ments in the re­gion, and China’s rapid ad­vance­ments will only leave In­dia fur­ther be­hind in terms of mil­i­tary ca­pa­bil­i­ties.

Sig­nif­i­cant short­fall

A look at the num­bers re­veals the short­fall is so sig­nif­i­cant that, for the Navy and the Air Force, the cap­i­tal al­lo­ca­tion does even meet the com­mit­ted li­a­bil­i­ties, that is, pay­ments for deals al­ready con­tracted. The Army, mean­while, is look­ing at a short­fall in its non-salary rev­enue ex­pen­di­ture.

“The Ser­vices have con­veyed their con­cerns to the De­fence Min­istry. De­fence Min­is­ter Nir­mala Sithara­man is tak­ing up the mat­ter with the Fi­nance Min­istry to ad­dress it,” a De­fence of­fi­cial said.

For in­stance, the Air Force, which has signed ma­jor deals in the past two years, in­clud­ing for the 36 Rafale jets and S-400 air de­fence sys­tems, and is be­gin­ning to in­duct plat­forms like CH-47F Chi­nook heavy lift he­li­copters and AH-64 Apache at­tack he­li­copters, has com­mit­ted li­a­bil­i­ties of ₹47,413 crore. In con­trast, the en­tire cap­i­tal al­lo­ca­tion is ₹39,347 crore and the pro­jected cap­i­tal re­quire­ment is ₹74,895 crore. Sim­i­larly, for the Navy, the com­mit­ted li­a­bil­i­ties for the com­ing year stand at ₹25,461 crore, while the to­tal cap­i­tal al­lo­ca­tion is ₹22,227 crore.

The de­fence al­lo­ca­tion in the in­terim Bud­get was ₹3.18 lakh crore, and De­fence pen­sions stood at ₹1.12 lakh crore. Of this, al­lo­ca­tion for rev­enue ex­pen­di­ture (net) is ₹2.01 lakh crore and cap­i­tal ex­pen­di­ture (net) is ₹1.08 lakh crore. The share of the three Ser­vices in the over­all de­fence bud­get stands as fol­lows: Army–54%, Navy–14% and Air Force–22%.

How­ever, the Army, with its large size, has a huge rev­enue bur­den com­pared to the other two Ser­vices, and a sig­nif­i­cant part of it goes for salaries. For the com­ing year, the Army has a to­tal short­fall of ₹12,000 crore, of which ₹6,300 crore is un­der the cap­i­tal head and around ₹5,500 crore is non-salary ex­pen­di­ture.

The Army has also em­barked on its big­gest re­or­gan­i­sa­tion drive since In­de­pen­dence and that would also en­tail some fi­nan­cial re­quire­ment.

Re­cently, to shorten pro­cure­ment cy­cles, the Vice Chiefs of the three Ser­vices and Army Com­man­ders were given greater fi­nan­cial pow­ers for emer­gency pro­cure­ment of spares and es­sen­tial items, but the money for them goes from the rev­enue stream.

Scarce rev­enue

Sim­i­larly, no sep­a­rate al­lo­ca­tion has been made for the project to strengthen perime­ter se­cu­rity of mil­i­tary in­stal­la­tions. These eat into the al­ready scarce rev­enue com­po­nent af­fect­ing train­ing and rou­tine main­te­nance ac­tiv­i­ties. An­other con­cern is the large pro­por­tion of vin­tage equip­ment in the Army and even the IAF, which is in ur­gent need of re­place­ment. For in­stance, last year, the Army had stated that 68% of its equip­ment is vin­tage.

The three Ser­vices are push­ing through sev­eral pro­cure­ments on a pri­or­ity ba­sis, many of which were to reach a de­ci­sive phase in the com­ing year, but there are no funds left for their con­clu­sion.

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