Even though the capital outlay on this year’s defence budget shows an increase of about 11.5 per cent from last year, what is actually available for acquisition of military hardware is simply not adequate for timely modernisation of India’s armed forces

Finance Minister Pranab Mukerjee’s budget has won many accolades like it is a politically correct budget, everybody’s budget, an eye on the elections budget, etc. On the defence expenditure front, however, hopes of a departure from the mundane and staid announcements of the previous years have proved to be thoroughly misplaced. Twoliner pronouncements were a jaded repeat of the previous years—the customary 10 per cent hike (primarily to counter domestic and international inflation) and a vague assurance, that if required, more funds would be provided to meet defence needs. The fact is India’s defence budget has yet again followed the recent ominous trend of straying to less than two per cent of the GDP. A similar dip was seen in the early 1960s, which resulted in India suffering an ignominious and shameful defeat at the hands of the Chinese. That was also the time when India’s political leadership had refused to address the country’s military vulnerabilities. India lost to the Chinese not because the Indian armed forces failed to measure up to the adversary, but owing to the refusal of the ruling establishment to acknowledge ground realities. Notwithstanding the political rhetoric, in reality, the UPA Government yet again failed to realise the ever-increasing security threats and challenges. While the old adversarial threats due to unresolved borders remain, new threats and challenges have also added to the old inventory of security woes. Terrorism in all its manifestations is a palpable threat and India also faces insurgencies generated both externally and internally. Likewise, proxy war in Jammu and Kashmir, fostered and supported in all respects by Pakistan, continues unabated.

It is a well-known fact that building military capability is a long-term exercise and therefore, defence expenditure should be linked to a long-term holistic plan, taking into account existing and emerging challenges and threats and based on trends in warfare, induction of new technologies and new methods of warfighting. When computed as a percentage of GDP, defence expenditure provides a clear indication of the investment a country is willing to make to meet its security concerns. This is a clear yardstick and a universally accepted norm. It is in this context and evaluating the threats and challenges India is likely to face, that major defence/security think tanks and analysts have recommended a hike in the defence budgets linking them to three per cent of the GDP till the necessary military capabilities are built up. Even Prime Minister Manmohan Singh had in the not too distant past issued a categorical assurance that if the economic growth were to reach eight per cent, defence allocations would be increased to three per cent of the GDP. This was also echoed by his Defence Minister A.K. Antony who saw no reason as to why the defence budget couldn’t be increased to three per cent of the GDP if India continues to maintain a high economic growth rate. However, even after achieving the desired growth rate year after year, the ministerial promises remain firmly in the realm of mere rhetoric.

Right after the announcement of India’s defence budget, China unveiled a stunning 12.7 per cent hike in its declared defence budget to $91.5 billion. While announcing the defence budget Li Zhaoxing, spokesman of the Chinese Parliament justified the increase by pointing to the levels of military spending by the US as also India. “Defence expenditure is 1.4 per cent of GDP in China,” added Li, while “that ratio in India is much higher than two per cent in India.” He is obviously wrong on both counts as not only India’s defence budget this year works out to be a paltry 1.83 per cent of the GDP, it also a known fact that the Chinese actual figures are two to four times higher than their officially declared figures. For example, last year, the Chinese had officially released a figure of 532.115 yuan ($78 billion approximately) for defence expenditure but the actual figures are estimated to have crossed the $200 billion mark. Similarly, this year’s defence budget may eventually cross the $250-300 billion mark. Then there is Pakistan, which is known to devote abnormally large percentage of its GDP on military spending. With this in view, it comes as a surprise to India’s security community when both the Defence Minister and his deputy show their satisfaction with this year’s allocations.