Five – Year Budget Model For Defence Forces Modernisation
For current financial year 2019-20, finance ministry allocated Rs 3,18,931 crore for Defence, which will only take care of committed liabilities of the forces. The For current budget for defence is just 1.6 percent of the Gross Domestic Product (GDP) which is said to be the lowest in many decades.
Out of Rs 3,18,931 crore allocated, Rs 2,10,682.42 crore is for revenue (Net) expenditure and Rs 1.08,248 crore for capital expenditure for defence services and the organisations and departments under Ministry of Defence.
The amount of Rs 1,08,284 crore allocated for capital expenditure, includes modernisation related expenditure. The amount is basically for the committed liabilities made by the Ministry, which included procurement of Rafale fighter jets, artillery guns and other procurement deals signed earlier.
For Rashtriya Rifles, Rs 7,003.25 crore was allocated and for National Cadet Corps a total Rs 1,607.28 crore has been allocated. For establishment and expenditure of Indian Army Rs 1,41,501.19 crore was kept, for Indian Navy Rs 22,211.71 crore was allocated and for Indian Air Force Rs 29,601.69 crore was kept.
Also this year import of defence equipment’s not manufactured in India has been exempted from basic custom duty. This will have an impact of augmenting the defence budget by approximately Rs 25,000 crore in account of saving in expenditure on custom duty for next five years.
However to use funds more efficiently and effectively and enhance capital expenditure, the Defence Ministry has started working on a new budget model which is based on a five year overall plan for military procurement, sources in the ministry said on Thursday. The current budget for defence is Rs 3.18 lakh crore, which is, 1.6 percent of the Gross Domestic Product (GDP) which is said to be the lowest in many decades. According to experts, is lowest since the 1962 war.
Sources said that the budget is now being made looking into five year modernisation plan and it is very important for the defence forces.
It was Defence Minister Rajnath Singh who asked the forces to give a plan for their five year requirements so as to make changes in future budget allocation. This is being done for “better utilisation of funds” and also ensure that there is no “lapse of funds” at the year end. “It will also enhance the efficiency in procurement,” sources said.
Earlier, the budget of defence was made looking into GDP so the budget was totally dependent on fluctuations in GDP. But now it would be made looking into forces requirement.
In a separate development, the government has approved setting up of a defence cyber agency to control and coordinate joint cyber operations, Union minister Shripad Naik said on Wednesday.
In a written response to a question in Lok Sabha, Minister of State for Defence said to mitigate cyber threats, all the three services of the armed forces have established their respective Cyber Emergency Response Teams (CERT).
Adequate safeguards have been instituted in the form of cyber audits, physical checks and policy guidelines to ensure a robust cyber posture of armed forces. Sufficient budgetary allocation is being provided for cyber operations and capability development.
Responding to a question on whether India has developed deterrence capability against adversaries who may attack Indian satellites to cripple systems in times of war, Naik said, “The desired information is strategic/sensitive in nature and its disclosure is not in the interests of national security.”
Responding to another question on whether the government has established Defence Space Research Agency, Naik replied in negative.
