India’s Defence Budgeting 

Syllabus :GS 3/Defense/Economy

In News 

• The parliamentary standing committee on defence recommended a benchmark percentage of GDP for defence allocation.

Status of Defense Budget 

• The Union Budget for Financial Year 2023-24 envisages a total outlay of Rs 45,03,097 crore.
  • Of this, the Ministry of Defence has been allocated a total Budget of Rs 5,93,537.64 crore, which is 13.18 % of the total budget.
    • This includes an amount of Rs 1,38,205 crore for Defence Pensions. 
  • The total Defence Budget represents an enhancement of Rs 68,371.49 crore (13%) over the Budget of 2022-23.

Need for Defense Budget 

• The planning and budgeting in the Indian military before the Russia-Ukraine war was for a short sharp conflict.
  • The logistics design was to stock up on 10i (10 days intense) war, and build up to a 40i scenario. 
  • The refrain has changed, with the leadership of the armed forces now visualising an extended war scenario, as seen in Ukraine. 
• Amid ongoing tensions and border disputes with China and Pakistan that occasionally spill over into armed clashes, There is a need to  prioritise the modernisation of armed forces and self-reliance in arms production.
  • India needs to be prepared to deter China in the environs of the Malacca Strait and further east, as also in the Indian Ocean.
•  The Army needs to modernise too and, considering its size, the Budget requirement would be considerable. 

Concerns 

• India’s defence budget in the last few years hovered around 1.8 to 1.97 per cent of the GDP (Gross Domestic Product).
• Defence expenditure (revenue and capital), as a percentage of central government expenditure, has been declining — from around 16.4% in 2012-13 to 13.3% in 2022-23.
  • The Ministry of Defence had asked for ₹1,76,346 crore in 2023–24 for capital acquisitions but only ₹1,62,600 crore was allotted, creating a deficit of ₹13,746 crore.
• The allocation for defence in Budget 2024-25, which starts getting planned now, could take a hit due to  elections
  • This could impact India’s deterrence posture, which defence preparedness is all about.

Parliamentary panel recent recommendations 

• The government should fix a “definite benchmark” percentage of the GDP for defence budget as military expenditure by neighbouring countries and the evolving global security scenario warrant such an outlay for the country to prepare for dealing with future security challenges.
• It specifically recommended putting adequate focus on developing futuristic drones and electronic warfare systems to confront future challenges.
• The global “ideal” estimate for defence expenditure as a percentage of GDP is three percent.
  • It recommended in unequivocal terms that if not the global parameter of 3 per cent, feasibility may be explored to fix a benchmark as the country’s GDP that will help in forming a right trajectory for the defence expenditure for the country.

Conclusion and Way Forward 

• There are many sectors like health, education, infrastructure, etc. competing for resource allocation from the Union Government.
  • All sectors are important in some or the other way since they fulfil India’s national aspirations of comprehensive national security with equal emphasis on human security issues. 
• The recent wars in the international arena should act as a grim reminder that the nomenclature of war has really changed and defence preparedness in terms of an electronic warfare has become an imperative need for our nation,
  • The armed forces should be technologically modern at any given time. However, developing a local defence industry takes decades, necessitating a smart balance to be maintained between imports and indigenous accretions to ensure the required potency.
• It said for ensuring such preparedness in view of the prevailing security scenario in the world today, there is a need for constant requirement of funds at regular intervals.
• The momentum should be sustained with a continuum in policy making and adequate defence budgeting by making them election-proof.

Source:TH