Defence Budget 2018-19

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chaitanya
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Re: Defence Budget 2018-19

Postby chaitanya » 01 Feb 2018 20:39

I think the anemic growth in capital outlay for defence is this government's way to push MII. Just look at the dramatic increase in the R&D (which I am guessing is DRDO) outlay over the past three years (in crores):

2016-2017: 6771.50
2017-2018: 7552.32
2018-2019: 9734.45

That's almost a 29% increase over last year and a 44% increase in 2 years... Maybe they want the forces to only buy Indian once funding increases. Thanks for posting this!

srin
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Re: Defence Budget 2018-19

Postby srin » 01 Feb 2018 20:47

From FM's mouth ...
https://economictimes.indiatimes.com/markets/expert-view/we-will-take-call-on-continuing-with-stt-depending-on-collections-arun-jaitley/articleshow/62742279.cms
Given the geopolitics and the Indian subcontinent conditions, would you say that the expenditure rise on defence could have been little more? It is only 6%.
I have had that responsibility on two occasions and I know it for certain that the defence needs more money but then we are in a catch 22 situation where how much revenue you get and how much tax you are able to realise have to be balanced. I am quite sure the surprise package for the coming year is going to be the GST. Just as income tax last year has saved us out of the situation, I expect GST to save us now because from today onwards, the anti-evasion measures are being put in place and once that happens, GST collection get bumped up.

Not really an answer, but the thinking of the Govt seems to be: we don't have enough money. I'm quite disappointed that Govt doesn't seem fit to have a multi-year capital expenditure budget for defence, despite knowing the need.

Prasad
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Re: Defence Budget 2018-19

Postby Prasad » 01 Feb 2018 21:08

A comprehensive revamp of program management is the need of the hour for MoD. Funding obviously is a major segment. We need to rework how our programs function and how they can be funded. Not the piecemeal drip feeding we have now.
Marginal % increase was always on the cards given electionsare coming up.

Vips
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Re: Defence Budget 2018-19

Postby Vips » 01 Feb 2018 21:56

Even if products are developed indigenously, if the same lackadaisical attitude continues (of citing fiscal difficulties) on trying to fill the crucial gaps in our Defence preparedness, we are doomed.

I had high hopes from the 56 inch chested politician and his nationalistic party but i guess it is just not in our DNA to be future ready and wait to be administered jhapads ( a la Kargil) to have some common sense and do the needul.

Philip
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Re: Defence Budget 2018-19

Postby Philip » 01 Feb 2018 22:05

Factor in inflation and increased expenditure on salaries, etc. for babudom which always looks after its interests first and what is left? The MOD must be cut to size along with the GOI bureauracracy in general.Reducing procedure by 50% of approvals reqd. plus the number of babus for the same will save us billions!

Buying more desi milware too won't save much moolah as many "desi" systems have large firang content and OEM built items often are cheaper than desi built ones.A constant 3% of the GDP must exist barring emergencies, which will increase the amt. of eqpt. bought locally and some of the lower tech items reserved only for local OEMs.

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Re: Defence Budget 2018-19

Postby Vips » 01 Feb 2018 22:15

Simply scary state of affairs.

At Rs 2.95 lakh crore, India's defence budget will be 1.58% of the projected GDP for 2018-19, it is the lowest such figure since the 1962 war with China.

Defence outlay has seen a consistent slip under the current government since its first budget presented for the 2014-15 fiscal.

Over three years to 2017-18, there was a 9% decline in budget allocation for capital investments against requirements. This could delay procurement and modernisation of the armed forces, says the committee report.


Philip
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Re: Defence Budget 2018-19

Postby Philip » 01 Feb 2018 22:27

Amazing! That too during the tenure of the BJP/ NDA.

ShauryaT
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Re: Defence Budget 2018-19

Postby ShauryaT » 01 Feb 2018 22:43

An inadvertently wise defence budget! - Bharat Karnad

India’s defence allocations in the 2018-2019 budget of Rs 2,95,511 crore, saw a meagre increase from Rs 2,74,114 crore last year, with Rs 99,563.86 crore set aside for the capital stream, 80% of which sum will be consumed by “committed liabilities”, meaning to service the procurement contracts already signed for, and Rs 1,95,947.55 crore for revenue expenditure (day-to-day running and payroll costs). (The rocketing pension allocations have a separate budgetary dispensation.) It will have the armed services twirling their collective mustachios in anger. The armed forces had hoped for a bloc commitment of Rs 26.84 lakh crore (in excess of $400 billion) for the next five years to ensure their modernization plans proceeded smoothly rather than fitfully as they are fated to do now.

The 13th Defence Plan had projected, Rs 12,88,654 crore as the capital outlay, and Rs 13,95,271 crore as the revenue spend. Both the defence five-year plans and the 15-year long-term integrated perspective plan are formulated to conform to the defmin’s “operational directives” but, as newspaper reports have noted, like the 10th (2002-07), 11th (2007-12) and 12th (2012-17) Plans, it too is unlikely to be approved by Finance Ministry.

If the armed services have a reason to feel neglected, consider what would happen if their expenditure plans are fully funded. The country will be stuck with a World War 2 vintage order-of-battle — the same old hardware — more tanks, APCs, artillery, air defence guns, tracked guns, etc. , which remains determinedly uncued to changes in the cyber regime, and in the evolution of small lethal drones that can be maneuvered in swarm to take out individual tanks — large unmissable targets, and defeat vast tank armies with equal ease, small, guided, submersible drones to sink warships, and hard-flying drone-projectiles to destroy by collision, combat aircraft. The Indian military seems completely innocent of these technology trends, and the Indian government without, apparently, a smidgeon of technology trend-spotting expertise, merrily funds or doesn’t whatever the armed services put before it.

So, the taxpayer has to ask himself: Is less harm done, less monies wasted. by not having a large defence budget than giving into “nationalistic” impulses and seeing the scarce national financial resources being grossly misused, as always, on propping up useless, dated genus of hardware?

In a sense, the Modi government has to be commended for holding its nerve and not trying to win cheap applause with increased defence spend — because surely there will now be uninformed calls from the opposition ranks led by the Congress party for surge funding of unnecessary goods the military would love to buy.

Resources are not the problem, what is is the Indian military’s mindless prioritizing of usually shortlegged weapons platforms and the like, and generally its spendthrift ways. And short of a single, integrated, command structure there will be no structural mechanism for inter se prioritization of the three Services’ demands and requirements, and the country will always be shortchanged in terms of not getting the security it pays for.

So, yes, Finmin Jaitley tripped in doing the right thing without quite knowing why! But good that comes from even inadvertent developments is no bad thing.
This is a backhanded compliment.

ramana
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Re: Defence Budget 2018-19

Postby ramana » 02 Feb 2018 01:03

First Defence Corridor in TN

https://twitter.com/DefenceMinIndia/sta ... 0910018561

And yet RW whine and cry that NaMo ignores TN! 8)

ShauryaT
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Re: Defence Budget 2018-19

Postby ShauryaT » 02 Feb 2018 02:07

ramana wrote:First Defence Corridor in TN

https://twitter.com/DefenceMinIndia/sta ... 0910018561

And yet RW whine and cry that NaMo ignores TN! 8)
RW's are still waiting for the implementation of the great Delhi-Mumbai industrial corridor and CDS!! Announcement have their worth in gold when followed through. I will stop the whine at 2 points :)

nam
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Re: Defence Budget 2018-19

Postby nam » 02 Feb 2018 03:31

The defence budget is as it says a "budget". It is "planned expense" for fiscal year. Along with it, additional amount for down payment for "potential new contract" which MoD think might happen in the fiscal year. GoI is paying for last year's contract which MoD managed to sign.

There is no point massively increasing defence budget, because MoD will not know what to spend it on! No contract is evaluated and signed within a year, for which you would suddenly need money. Having a bigger budget will not make MoD sign more contracts. it is the other way around!

Post Uri, GoI ordered 3 billion dollar of emergency purchases. Has anyone remembered to add this to the defense budget of 2016-17? If capital allocation for 16-17 was 5-6 billion, there was a increment of 60% without anyone noticing it!

This is the key. GoI able to fund purchase, when MoD decides on a contract. More than headline grabbing 50% increase in the budget, MoD need be streamlined to make it sign contracts on time.

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Re: Defence Budget 2018-19

Postby Vipul » 02 Feb 2018 03:51

Government is taking over under the enemy property act assets worth 100,000 Crore rupees. This windfall gain by the government should be only and (most aptly) be used on Capital expenditure for acquisition of force multipliers. It should not be used under any circumstances for populist measures or on Grandiose schemes.

ShauryaT
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Re: Defence Budget 2018-19

Postby ShauryaT » 02 Feb 2018 04:13

Nam: Do you think the budget is only some wily-nily planning thingie only? There is no magical additional $3 billion "spent" on account of defense for last year. Do not go by DDM reports alone. If anything, experience shows the capital budget is underspent year after year and monies from defense budget returned to fund government overspending usually on subsidies or underperformance in revenue. The real decision maker for defense is the FM, especially with the FM's two stints as interim RM.

@vipul: This budget is already targeted almost exclusively on populist measures, like rural health and MSP. This government's priority is clear. No major upheavals or shakeups and continue to spend on issues aligned with their political goals. Not a critique, I have been told that is how India works and should work!!! I am still grappling with those ideas.

ramana
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Re: Defence Budget 2018-19

Postby ramana » 02 Feb 2018 05:13

Ok. Looks like nothing more to say.

Will lock up the thread.

sankum, Thanks for opening this thread but its not needed for forum members don't see the value.


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