Budget shortfall worries Defence Services

Why is it in news?
  • The shortfall in Defence allocation in the interim Budget 2019-20, especially in its capital allocation, has left the Services worried as it threatens to derail the capability enhancement and modernisation underway.
  • This comes at a time of fast-paced developments in the region, and China’s rapid advancements will only leave India further behind in terms of military capabilities.
More in news
  • Significant shortfall:
    (1) A look at the numbers reveals the shortfall is so significant that, for the Navy and Air Force, the capital allocation does even meet the committed liabilities, that is, payments for deals already contracted.
    (2)The Army, meanwhile, is looking at a shortfall in its non-salary revenue expenditure.
    (3) The Defence allocation in the interim budget was Rs. 3.18 lakh crore, and Defence pensions stood at 1.12 lakh crore.
    (4) Of this, allocation for revenue expenditure (net) is Rs. 2.01 lakh crore and capital expenditure (net) is Rs. 1.08 lakh crore.
    (5) The share of the three Services in the overall defence budget stands as follows: Army–54%, Navy–14% and Air Force–22%.
    (6) The Army, with its large size, has a huge revenue burden compared to the other two Services, and a significant part of it goes for salaries.
    (7) The Army has also embarked on its biggest reorganisation drive since independence and that would also entail some financial requirement.
    (8) The three Services are pushing through several procurements on a priority basis, many of which were to reach a decisive phase in the coming year, but there are no funds left for their conclusion.
Source
The Hindu




Posted by Jawwad Kazi on 11th Feb 2019
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