First Budget of Modi 2.0 - defence ignored

July 6, 2019 By Lt. General P.C. Katoch (Retd) Photo(s): By PIB
The Author is Former Director General of Information Systems and A Special Forces Veteran, Indian Army

 

Union Minister for Finance and Corporate Affairs Nirmala Sitharaman along with the Minister of State for Finance and Corporate Affairs Anurag Singh Thakur arrives at Parliament House to present the Union Budget 2019-20, in New Delhi on July 5, 2019.

Finance Minister Nirmala Sitharaman presented Budget 2019 of the new NDA government lead by Narendra Modiin parliament on June 5, 2019, with what she described as a 10-year vision. The focus of her speech was centred mainly on economy, rural and urban level schemes including ease of living, youth, women, soft power, banking and financial sector, taxation, investment, electric vehicles, start-ups, housing, non-banking financial companies, international financing, ease of living, IT returns, digital payments and revenue mobilisation. FM said that we are reaching a $3 trillion economy this year and aspire to reach a $5 trillion economy. However, despite unemployment of India being at 45-year high, which will shoot up with galloping population, the only mention was to provide skills training to about 10 million youth over 10 years. There was no mention of any measures for population control, like disincentives for having more than two children. A special mention was also warranted with respect to health and malnutrition of children, in which India's record remains pathetic even below some African nations. But this too was missing.

Ironically, Sitharaman in her almost 11,000-worded budget speech made an oblique reference to defence under 'Indirect Taxes' in precisely 36 words saying, "Defence has an immediate requirement of modernisation and upgradation. This is a national priority. For this purpose, import of defence equipment that are not being manufactured in India are being exempted from the basic customs duty". The paradox is that Sitharaman was the Defence Minister till only a few weeks back. Even the 10-year vision makes no mention of making India a militarily strong nation.

There is much talk about soft power, but why do our policy makers fail to acknowledge that soft power is of little value unless backed by hard power, without hard power we remain at disadvantage on the bargaining table, and rhetoric is no substitute to hard power.

In the budget by Finance Minister Arun Jaitley on February 01, 2019 (under the previous NDA government) allocation for defence for FY 2019-2020 was 3,18,931.22 crore (excluding pensions). This was below 1.50% of projected GDP for the year lowest since 1962. Though Jaitley portrayed an increase of 7.93 per cent over Budget Estimates (2,95,511.41 crore) and of 6.87 per cent over the Revised Estimates (2,98,418.72 crore) for FY 2018-19, the increase was inadequate to allow for the prevailing rate of inflation, proposed hike in pay and allowances, decline of rupee vis--vis US dollar impacting import of weapons and equipment that are imported, which comprise about 70 per cent of total defence procurement. It has been mentioned in these columns that annual defence allocations over last five years have been negative in actual terms. The pathetic state of India's military modernisation was presented to the Parliament by the Standing Committee on Defence headed by Major General B.C. Khanduri. But government chose to pull wool over eyes of the public with Sitharaman publicly condemning the report, which led to the sacking of General Khanduri. Significantly, the Army had to even shut down multiple ongoing programmes, forget modernisation. India's ratio of defence expenditure vis--vis overall government expenditure is lowest in the world (15.48 per cent for FY 2019-2020, even below Pakistan. The fact remains that critical voids persist in our Armed Forces. Poor defence allocations have forced Armed Forces to continue using obsolete/vintage weapons resulting in degraded combat capacity. The ground situation is little different from the Kargil Conflict when then Army Chief, General V.P. Malik was forced to say, "We will fight with what we have". India remains the second highest arms importer in the world. Sitharaman announced exemption of basic custom duty for defence imports, but what about defence-industrial complex products being sold to Armed Forces on twice-thrice the price of what is available commercially-off-the-shelf (COTS), and on top of that imposing GST on them (28 per cent); stabbing the military both ways? What about the miniscule FDI in defence over last five years? Sitharaman talked of connectivity and Pradhan Mantri Gram Sudhar Yojna (PMGSY) but why is she forgetting border villages of northeast which are vital for security. China's intrusion in Tuting area in December 2016 was a jeepable road 1.5 km our side of the LAC in three feet of snow (discovered by a hunter) while our closest village 'Bishing' did not have a motorable road because PMGSY does not cover villages with less that 100 population. Our soldiers had to walk 19 hours to reach the intrusion. Can India afford such serious security voids? Reciting an Urdu couplet and quoting Chanakya, Sitharaman also said, "Our objective was, and continues to be , Mazboot Desh Ke Liye Mazboot Nagrik (Strong Citizens for Strong Nation). But are military soldiers considered citizens or are they non-entities? If that is not the case, why are they being treated like trash by the politico-bureaucratic nexus aided by a pliable military hierarchy, multiple instances of which are already in public domain hitting at the very prestige and psyche of soldiers? When a chief publicly states he is not the chief of veterans then why should his recommendations for disability pension of veterans count, especially when he has failed to stop malpractice? And, why is Sitharaman taking cover behind such recommendations, especially when civilians even with below 20 per cent disability are exempted from IT?

The bureaucracy is going hyper to undermine the military. K Srinidhi, under secretary, MoD, has issued a directive that re-appropriation of government buildings for 'non-bonafide' purposes like educational institutions by AWES cannot be accepted. The obvious intention is to make them shut shop. Same would go for think tanks like CENJOWS, CLAWS, CAPS, NMF etc? Why not simply state once for all that 'Sab Ka Saath, Sab Ka Vikas, Sab Ka Vishwas' is not applicable to military soldiers and that they are just a necessary evil? What a shame that a nation reaching a $3 trillion economy remains unfocussed to evolve a strong military, respect its soldiers and give them their dues.