While the government has increased the defence budget for fiscal 2018-19 by 5.91 per cent to Rs 2,95,511.41 crore, the allocation is estimated at around 1.58 per cent of the GDP ~ the lowest since 1962. This has once again dashed hopes for any major jump in military modernisation despite heightened tensions confronting Pakistan and China along the unsettled borders.

An additional amount of Rs 1,08,853.30 crore has been provided for defence pensions. The defence budget, which will account for 12.10 per cent of the total government expenditure, is 7.81 per cent more than the Rs 2,74,114.12 crore announced in the last budget for 2017-18 ~ the figure was later revised to Rs 2,79,003.85 crore.

Moreover, the defence budget includes a capital outlay of just Rs 99,563.86 crore for new weapon systems and modernisation, which is dwarfed by the revenue expenditure (day-to-day running costs, salaries etc.) of Rs 1,95,947.55 crore and expenditure on pensions.

The annual defence budgets have shown a discernible trend of declining modernisation outlays for new projects, with almost 80 per cent of the outlays earmarked for “committed liabilities” (installments for arms deals inked in earlier years) and skewed revenue to capital expenditure ratio. This has meant that the Army, Navy and Air Force continue to grapple with critical operational gaps on several fronts ranging from small arms, guns, howitzers, fighters, and submarines to helicopters and also other defence equipment.

On his part, finance minister Arun Jaitley declared that the government was focusing on developing connectivity infrastructure in border areas to secure the country’s defences. “Rohtang tunnel has been completed to provide all -eather connectivity to the Ladakh region. Contract for construction of Zozila Pass tunnel of more than 14 kilometers is progressing well. I now propose to take up construction of the tunnel under Sela Pass (in Arunachal Pradesh),” he said.

“Our armed forces have played a stellar role in meeting the challenges we have been facing on our borders as well as in managing the internal security environment both in Jammu and Kashmir and the North-East. I would like to place on record our appreciation for the efforts and the sacrifices made by the three services in defending the interests of the nation,” he added. The armed forces, incidentally, had sought an allocation of Rs 26.84 lakh crore+ ($416 billion) over the next five years to ensure requisite military modernisation and maintenance.

As per the 13th Defence Plan, Rs 12,88,654 crore has been projected for capital outlay, while Rs 13,95,271 crore for revenue expenditure. With an eye firmly on China, there is also a separate section in the plan on the “capability development” of the strategically-located tri-Service Andaman and Nicobar Command, which was set up in October 2001 but has suffered from relative neglect, lack of infrastructure and turf wars due to shortage of funds.

The defence five-year plans are formulated in consonance with existing threat perceptions, the “Raksha Mantri’s operational directives” and the 15-year long-term integrated perspective plan (LTIPP). But they have not received much attention from successive governments, with the 10th (2002-07), 11th (2007-12) and 12th (2012-17) Plans failing to get approval from the finance ministry.

The Government will develop two defence industrial production corridors and bring out an industry-friendly military production policy to promote defence manufacturing in India. Mr Jaitley said the government would also bring out an industry-friendly “defence production policy 2018” to promote domestic production by the public sector, private sector and MSMEs. He said a number of initiatives had been taken to develop and nurture India’s intrinsic defence production capability to make the nation self-reliant on its defence needs. The minister said private investment in defence production had been opened up, including liberalising foreign direct investment.

The Defence budget is utilised to meet revenue and capital expenditure. India is a growing superpower, and is surrounded by arch rivals ~ Pakistan in the west and China in the north. Besides, India has to fight terrorism and insurgency in Jammu & Kashmir and North-east. The budget, therefore, must fulfill all the needs of our defence forces.

“The allocation is not at all adequate for modernisation of our armed forces. The expectation was much more,” said Dr. Laxman Behera, research fellow at the Institute of Defence Studies and Analysis (IDSA). The defence outlay is not based on the threat perception from a twin-pronged offensive from China and Pakistan for which the country has to be prepared.

The report by the Comptroller and Auditor-General (CAG), which states that there is a serious shortage of ammunition in the Indian Army, has caused deep concerns and raised questions about the preparedness of the armed forces to fight a war. An earlier CAG report had mentioned the poor state of ammunition management in the army for the period 2008-13. The latest report is a follow-up audit and it has not found any significant improvement in the availability and quality of ammunition supplied by the Ordnance Factory Board (OFB) to the forces.

The Infantry, which is the ‘queen of battle’, faces an acute shortage of small arms like assault rifles, sniper rifles, sten guns, light machine guns and anti-tank guided missiles. The Indian Small Arms System Rifles (INSAS) need to be replaced with modern assault rifles. Currently, the army is using AK-47’s and INSAS. The personal kit of an Indian soldier, which includes bulletproof jackets, helmets and shoes, needs to be replaced with lighter kit. The Army has once again sounded the alarm bell about its critical operational deficiency in the field of anti-tank guided missiles (ATGMs), asking the government for the emergency induction of at least some of these “tank killers” till the indigenous man-portable systems, being developed by the Defence Research and Development Organisation (DRDO), become a reality.

The Army, after all, has an alarming shortage of around 68,000 ATGMs and 850 launchers of different types, which are crucial for the infantry to halt the advancing enemy tanks in the plains as well as guard the “active” line of control with Pakistan.

The writer is a retired Professor of International Trade. He can be reached at [email protected]