Context
The defence budget, 2017-18, raises serious concerns
Issue: Inadequate defence budget outlay
Stats
Total outlay to defence = Rs 274114 crore, excluding the outlay of Rs 85,740 crore for defence pensions
What, defence analysts and standing committee on defence, want the defence outlay to be?
Defence outlay of 3% of GDP is being asked for
Few concerns
- Underutilization of existing meagre outlay: As has been noted in yesterday’s brief, the ministry of defence returned more than Rs13000 crore from the capital head in 2015-16, and another Rs7000 crore in 2016-17, which was unspent. This repeated underutilization of the capital budget weakens the case for higher allocations for new acquisitions
- Inadequate allocation for maintenance of equipment currently in use: Author states that there is an immediate requirement for funds for this purpose
- Inadequate allocation for war wastage reserves: Indian army needs adequate allocation on this front also
War wastage reserve (WWR):War wastage reserves (WWR) are collections of military material held in reserve in case of war. This includes bullets and other form of ammunition, as well as equipment, weapons and fuel
- No contract signed under Make in India: Author states that under ‘Make in India’ programme, no development contract has been signed so far and with a meagre allocation of Rs 44.63 crore for assistance to prototype development, it seems the MoD isn’t expecting many projects
- Lack of future vision: Author mentions that while budget speech contained references to schemes like the Centralised Defence Travel System and the interactive Pension Disbursement System, there was no mention of important policy issues like the strategic partnership scheme and defence technology fund. It indicates that government is not thinking long term or is not serious enough
Way forward
What is needed is an outcome-oriented monitoring of utilisation of outlays, as recommended by the standing committee last year. This is the only way to ensure that the focus shifts from ensuring full utilisation of funds to spending these wisely on the desired outcomes — there is no indication that this is going to happen in the coming year
Read more: Defence Technology Fund, Why is Indian military running out of ammunition?
