Security challenges require more funds

THE funds allotted for defence expenditure by Finance Minister P. Chidambaram for the financial year 2013-14 are inadequate to meet the growing threats and challenges facing the country, for modernisation of the armed forces and India’s increasing responsibilities as a regional power. The defence budget is also inadequate to expeditiously make up the “critical hollowness” in defence preparedness pointed out by General V K Singh, the Army Chief. 
The increase of 5.3 per cent in the budget estimates from Rs 1,93,007 crore in 2012-13 to Rs 2,03,672.10 crore ($ 37.46 billion) for 2013-14 is too small to allow for inflation, which is ruling at about 7.5 per cent annually. Also, the rupee’s recent slide against the dollar to almost Rs 55 to a dollar has further eroded its purchasing power. Hence, in real terms the defence budget has actually declined by about 1.3 per cent. 
China’s People’s Liberation Army (PLA) has been modernising at a rapid pace for over a decade, backed by a double-digit annual hike in the defence budget. At $ 115.70 billion, China’s official defence budget for the current year is 10.7 per cent more than the previous year and it is over three times India’s planned defence expenditure. As China invariably conceals many items of expenditure on national security, its actual expenditure is likely to be well over $ 150 billion. 
China is investing heavily in modernising its surface-to-surface missile firepower, fighter aircraft and air-to-ground strike capability. It is acquiring strategic airlift capability, modern aircraft carriers, new submarines, improving command and control and surveillance systems and is enhancing its capacity to launch amphibious operations. It is also upgrading the military infrastructure in Tibet to sustain larger deployments over longer durations. 
Despite the long list of obsolescent weapons and equipment in service with the Indian armed forces, the present military gap with China is quantitative rather than qualitative. However, as India’s military modernisation has been stagnating for several years, this gap is likely to soon become a qualitative one as well. By about 2020-25, China will complete its military modernisation and will then be in a position to dictate terms on the resolution of the territorial dispute if India continues to neglect defence preparedness. 
Of the total allocation for defence, the Army will get Rs 99,707.8 crore (49 per cent), the Navy Rs 36,343.5 crore (18 per cent), the Air Force Rs 57,502.9 crore (28 per cent) and the Defence Research and Development Organisation (DRDO) Rs 10,610.2 crore (5 per cent). The total revenue expenditure planned for the year is Rs 1,16,931.41 crore (2.73 per cent increase, 57.41 per cent of the budget). 
The remaining amount of Rs 86,740.71 crore (9 per cent increase, 42.59 per cent of the budget) has been allotted on the capital account for the acquisition of modern weapon systems. Major purchases this year are likely to include initial payments for 126 multi-mission, medium-range Rafale combat aircraft, 197 light helicopters, 145 Ultra-light Howitzers and C-17 heavy-lift aircraft, among others. India is expected to spend approximately $ 100 billion over the 12th (2012-17) and 13th (2017-22) five-year defence plans for military modernisation. 
The government has earmarked Rs 52,264 crore for the Central Armed Police Forces (CAPF) in the annual budget of the Ministry of Home Affairs (MHA) for homeland or internal security. A portion of these funds will be utilised for setting up a National Intelligence Grid and the National Counter-Terrorism Centre — measures which are considered essential to streamline counter-terrorism efforts consequent to the Mumbai terror strikes in November 2008. Also, the state governments will be given Rs 1,847 crore for the modernisation of their police forces. 
This year’s defence budget has been pegged at 1.79 per cent of the projected GDP, which is the lowest since 1961-62 when it was 1.66 per cent. The 13th Finance Commission had recommended that the nation’s defence expenditure should progressively come down to 1.76 per cent of the GDP by 2014-15 and perhaps the Finance Minister has decided to go by that recommendation. China and Pakistan spend between 3 and 4 per cent of their GDP on defence. India’s per capita expenditure on defence is less than $ 10, while the average expenditure of the top 10 spenders in Asia is $ 800 approximately. India’s soldiers-to-citizens ratio, at 1.22 per 1,000 citizens is among the lowest in Asia. The average of the top 10 Asian nations is about 20 soldiers per 1,000 citizens. 
The reasons for India’s lackadaisical approach to military modernisation include the shortage of funds on the capital account for major defence acquisitions, the inability to spend even the allotted funds due to bureaucratic red tape in decision making and the lack of a robust indigenous defence industry because of excessive reliance on uncompetitive ordnance factories and defence PSUs. 
The lack of progress in the replacement of the Army’s obsolescent weapons and equipment and its qualitative modernisation to meet future threats and challenges is particularly worrisome as the Army continues to maintain large-scale deployments on border management and internal security duties. It needs to upgrade its rudimentary C4I2SR system and graduate quickly to network centricity to optimise the use of its combat potential. While the mechanised forces in the plains are still partly night blind, the capability to launch offensive operations in the mountains continues to remain inadequate to deter conflict. All of this will need massive budgetary support, which can be provided only if the defence budget goes up to 2.5 to 3 per cent of the GDP. 
While some tightening of the belt is understandable when the economy has taken a downturn, India’s expenditure on national security is clearly inadequate to squarely face the emerging threats and challenges. The government must insulate planning for national security from the vagaries of fluctuating economic fortunes by backing five-year defence plans with firm budgetary commitments. 
The writer is a Delhi-based strategic analyst.