The budget allocation for the military saw a marginal hike of 7.81% from Rs.2,74,114 crore last year to Rs.2,95,511 crore this time, thus failing to generate much hope for several big-ticket modernisation plans in the pipeline under the ‘Make in India’ programme in defence.
The pension fund of the defence forces at Rs.1,08,853 crore allocated separately in the Budget is more than the funds allocated for buying new weapon systems under the capital acquisition fund, which is pegged at Rs. 99,563.86 crore.
The defence budget is 1.58 per cent of the projected GDP for 2018-19 and is the lowest since the war with China in 1962. Military experts have been demanding a hike in budget for tackling a two-front war scenario and want it to be around 2.5 per cent.
For day-today functioning of defence forces, including salaries and works, the ministry has been allocated Rs.1,95,947.55 crore.
“We were expecting a bigger hike for the forces in view of ongoing issues on the borders. But what matters more is how well the allocated funds are utilised for modernisation and if there are any shortfalls, the government is there to help,” said former Army deputy chief Lt Gen Narendra Singh.
There are several projects under the ‘Make in India’ project, including construction of six conventional and six nuclear submarines, along with local manufacturing of several types of transport planes and helicopters.
In his Budget speech, Union finance minister Arun Jaitley appreciated the role played by the armed forces in meeting challenges on the country’s borders as well as in managing the internal security environment, both in Jammu and Kashmir and the Northeast. He said the government will develop two defence industrial production corridors.
The first such defence industrial corridor will come up in Tamil Nadu after the recent success of the defence conclave held by the Union defence ministry there.
Welcoming the budget, Union defence minister Nirmala Sitharaman said, “These are the first ever defence production corridors being formed in the country. These defence industry corridors will give a big boost to defence production in the country.”