Budget 2021: Defence preparedness gets highest allocation in 15 years

With no imminent signs of military disengagement on Ladakh border with China, the Union government has hiked modernisation budget by close to 19 per cent, which will essentially be spent for country's defence preparedness.

Capital outlay has increased to Rs 1,35,061 crore from Rs 1,13,734 crore, which is over 18.50 per cent to previous budget. It means armed forces will get Rs 21,326 crore more than last year to purchase several critical equipment, including armoured vehicles, assault rifles and missiles to counter Chinese aggression.

The highest ever jump in capital outlay of defence in last 15 years comes at a time when over 50,000 troops of Indian military is engaged in a 10-month-long faceoff on the icy heights of Ladakh.

Praising the hike in modernisation budget, former Army chief General Ved Malik said, "Nearly 20 per cent increase in capital defence budget is positive. Hope we will not see an overspend on the revenue and pensions."

A closer look at the earlier Union budgets shows that the armed forces got an additional allocation of Rs 20,776 crore under capital expenditure last year for emergency procurements in the face of large-scale deployment along the Line of Actual Control (LAC). Even the Army had recieved an additional amount of Rs 8,500 crore, in the backdrop. Additional allocation of budget came in the revised estimate (RE Budget) category. While Rs 6,000 crore was given under the revenue allocation to meet the day-to-day needs of deployed troops on the border, Rs 2,500 crore was for modernisation under the capital allocation category. It is notable that last year, 38 deals were made through ‘emergency and fast track’ route worth about Rs 5,000 crore and in addition, capital procurements worth Rs 13,000 crore were also done including combat vehicles, light machine guns, light special vehicles and protective gear for infantry soldiers.

The total outlay of Rs 4.78 lakh crore included an allocation of Rs 1.15 lakh crore for payment of pensions. Significantly, the allocation for payment of pension has come down as it was Rs 1.33 lakh crore in the previous budget. Experts said the drop in the allocation could be an indication of the government's plan to cut expenditure on payment of pension by increasing the retirement age of military officers. Excluding the pension outgo, the total revenue expenditure, which includes expenses on payment of salaries and maintenance of establishments, has been pegged at Rs 2.12 lakh crore.

Clarifying on the decrease in defence pension budget, a MoD official said that last year, it was more because approximately Rs 18.000 crore was to be paid on account of pension arrears. Salary and pensions are based on actuals, the official said.

Defence budget, which is over 13 per cent of the total budget, is also 2.15 per cent of the country's GDP.

Moreover, in order to boost the research and development and to attain self-reliance, the capital allocation for DRDO has been increased to Rs 11,375.5 crore—an increase of 8 per cent over 2020-21 and 8.5 per cent over 2019-20. To reduce India's dependence on arms imports, various measures were announced last year, including 101 items that were embargoed to be imported.

Similarly, focusing on border infrastructure, especially on the border with China, allocation for Border Roads Organisation (BRO) has been increased to Rs 6004.08 crore which is a 7.48 per cent increase over FY 2021-22 and 14.49 per cent over FY 2019-20. Huge money has been pumped into BRO to complete the pending border roads and other infrastructure projects and it has irked China, according to defence experts.

Indian Navy has got the maximum hike among the three services. Navy's share is Rs 33,253.55 crore, while the IAF is getting Rs 53,214.77 crore and Army is Rs 36,481.9 crore.