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March 17, 2012

Budget 2012: Military plays catch-up but China a long march ahead

Modernization of the over 13-lakh strong armed forces will continue in a steady albeit sluggish manner, with the defence outlay being hiked to Rs 1,93,408 crore (around $39 billion) to cater for some major fighter, aircraft, helicopter and howitzer deals to be inked in the coming fiscal.

But two major worries remain. One, India's budgeted defence expenditure still remains just 1.9% of the projected GDP for 2012-13, much less than the 3% being demanded by the armed forces and strategic experts for several years to effectively deter both China and Pakistan. An assertive China, for instance, recently hiked its official defence budget to over $100 billion.

Two, the revenue expenditure (day-to-day costs and salaries) pegged at Rs 1,13,829 crore for the coming fiscal continues to far outstrip the capital one for new weapons, sensors and platforms at Rs 79,579 crore. There is simply no indication the much-touted aim to "transform'' the military into a lean, mean fighting machine is anywhere on the horizon. 

 Moreover, the defence ministry has been forced to return Rs 3,055 crore of unspent capital funds. Defence minister A K Antony admitted he had expected more for his ministry this time but he took solace at the FM declaring that additional money would be provided if needed.

For the record, the 2012-2013 defence outlay represents a 17.63% hike over last year's budgetary allocation of Rs 1,64,415 crore. But if revised estimates of 2011-2012 are taken, it becomes a mere 13.14% jump.

Capital expenditure, in turn, has registered a more robust 20.3% hike from last year's revised estimate of Rs 66,144 crore. This will, however, be just enough to keep the modernization on track, without any surges, since a major chunk of it will also go for already contracted weapon systems.

Army, in particular, is grappling with "operational gaps'' in artillery guns, air defence weapons, night-vision capabilities and aviation. IAF and Navy, too, are making do with inadequate aircraft, helicopters, submarines and trainers.

A mega project on the anvil is the almost $20 billion MMRCA (medium multi-role combat aircraft) programme to acquire 126 fighters for IAF, with the final commercial negotiations for the French Rafale jet now in progress.

Even as IAF also waits for the over Rs 3,000 crore deal for 75 Swiss Pilatus PC-7 turbo-prop aircraft to train its rookie pilots, Army is desperate to acquire 145 M-777 ultra-light howitzers from the US for $647 million, its first-ever acquisition of 155mm guns since the infamous scandal in the mid-1980s completely derailed its artillery modernization plans.



Times of India

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