The only surprise in the defence budget was no surprise: static, in real terms, a negative budget for modernization- the litmus test of capability enhancement for maintaining deterrence in order to meet the two-and-a-half threat challenge plus government articulated missions of retaking PoK and Aksai Chin. Much of the capital is consumed by committed liabilities – payment for equipment already ordered and in the pipeline. Overconfidence in a strong government and leader, the chimera of G20 grandeur, and ‘it is not an era of war’ but ‘Amrit Kaal has ruled out conflict with China and Pakistan. Northern Army Commander, Lt Gen Dwivedi earlier and former Army Chief, Gen Naravane, only last month, revived illusions of ‘we are in a position of strength’ in Ladakh. In the last nine years, the ruling government has invested more in lip servicing and symbolism than in closing the capability gap with China as defence budgets have hovered between 1.5 and 1.6 percent of GDP. Former Defence Minister Arun Jaitley would admit: “we have no money, we can’t put cess on defence”. So the government has renamed anonymous islands after PVC winners, built giant statues, installed tall flags, and embellished Jai Jawan Jai Kisan Jai Vigyan with Jai Anusandhan.
In the current fiscal defence has dropped to 1.4 percent of GDP and for the first time in decades, dipped below 2 percent of GDP if the pension bill is included. The capital acquisition increased from Rs 12,000 crore to Rs 1.6 lakh crore just an 8 percent increase well below inflation and the falling rupee. As there is no National Defence Strategy and a Policy, Plans, and Budgeting System to evaluate inter se capabilities, allocation is erratic and prioritized by CDS. IAF chief Air Chief Marshal VR Chaudhuri has thrice publicly mentioned the dangers of combat squadron strength dwindling to 28/30 squadrons against the authorized 45 squadrons. PM Modi acquired 38 Rafales against 126 MRCA urgently sought by IAF. Its requirement of 114 MRCA has been languishing for years: Acceptance of Necessity (AoN) is still not fructified i.e. forget it.
Similarly, the Navy, whose missions have multiplied – from the Gulf of Aden to the Indo-Pacific – is woefully deficient in submarines, and the indigenous aircraft carrier Vikrant is minus aircraft and other subsystems. At this pace of modernization, the third aircraft carrier is a mirage. Manpower-intensive Army needs a new tank, a light tank, and a new gun. The increased capital segment of the revenue budget is to make up for deficiencies in ammunition and equipment to fight a 30-day war not 10 days of intense conflict. Neither the hand-picked service chiefs bar Chaudhuri, nor the deeply-selected CDS Gen Anil Chouhan, has pointed to shortfalls in the modernization budget. They are unlikely to do so in the prevailing environment when discretion has become a better part of valour. Young officers have proven the backbone as an ADC of President Murmu gently ticked off Modi when he tried to step ahead of her during the Republic Day parade.
Two instances need recall. Former Army Chief, Gen Shankar Roy Choudhury warned the government that Army will not be responsible for any operational mishap due to inadequate funding and former CNS Adm Vijay Shekhawat declared at a press briefing that naval shipyards not receiving ship orders will have a negative effect on naval capabilities. The next day Defence Minister Mulayam Singh Yadav invited Shekhawat to breakfast. It is inconceivable that the highly nationalistic government that has excelled in capex – infrastructure hikes and doubled railway budget – has kept the sword arm insufficiently sharpened.
The government took huge operational risks by keeping the Army alone deficient of 300,000 soldiers: no recruitment was done for the last three years due to Covid. While the annual demobilization of 65,000 soldiers continued, no salaries had to be paid for the void in recruitment. Only now will 46,000 Agniveers be recruited on a low salary and no pension. It’s OROP whose cost equaled modernization allocation but has reduced to Rs 1.3 lakh crore that is hurting. OROP arrears worth Rs 23000 crores are due by 31 March. Modi must rue his 2014 BJP election manifesto in signing up for OROP. This is indeed an era of war. As Russia’s invasion of Ukraine enters its second year, India has to review its relations with Russia which has China, a no-limit strategic partnership. India is still dependent on Russian military hardware, technology, and spares. Serge Chemezov, CEO of Russia military industrial Rostek was in India last month for payment of dues on account of Russian oil and S400 AD systems. The Americans are making determined efforts including the use of sanctions and diplomatic pressure to wean India away from Russian equipment. All European countries are increasing defence budgets to meet twin Russia-China challenges. The UK, France, and even Germany have reached 2 percent of GDP spending levels. Japan has erased the one percent GDP embargo and will spend USD332bn over the next five years. In Asia Pacific, South Korea, and the Philippines are increasing defence capabilities by 8 and 5 percent respectively. Despite active LAC and LoC and a sensitive internal environment, the Modi-Shah government is happy to let China march ahead with a defence budget thrice India’s size. There is an urgent need for recapitalization of defence to deter China.