India’s Defence Budget 2020-21

Deceptive figures, faulty analyses

Amjed Jaaved

For year 2020-21, India’s Modi-led BJP government has allocated Indian Rupees (INR) 3,23,053 crore (about $45.8 billion at current exchange rate) for ‘defence services’. This excludes pensions and running of the defence administration—the ministry and the departments so concerned. It is 9.37 percent higher than the budget estimates for 2019-20. For modernization and buying new weapon systems, defence forces have been allocated Rs1,107.34 billion (PKR2,393 billion) which is Rs 103.40 billion more than what was provided in last year’s budget. A lion’s share of the budget has been allocated to the Army, followed by the Navy and the Air Force.

 

India’s Union Budget for the financial year 2020-21, which was presented by the country’s Finance Minister Ms Nirmala Sitharaman on February 01, 2020, envisages a total outlay of Rs. 30,42,230 crore. Out of this, an amount of Rs 3,37,553 crore has been allocated for military (excluding military pension)—for military pensions, Rs. 1,33,825 crore have been provided in Budget Estimates 2020-21. Overall, there is an increase of Rs. 40,367.21 crore in the total military allocations (Rs. 4, 71,378 crore) including Defence Pension over the financial year 2019-20. Total defence budget accounts for 15.49 percent of the total central government expenditure for the year 2020-21.

The allocation of Rs. 4, 71,378 crore represents a growth of 9.37 percent over Budget Estimates Rs. 4, 31,010.79 crore for the previous financial year. Out of Rs. 3,37,553 crore allocated for the financial year 2020-21, Rs. 2,18,998 crore is for the Revenue (Net) expenditure and Rs. 1,18,555 crore is for capital expenditure for the Defence Services and the Organisations/Departments under Ministry of Defence. The amount of Rs. 1,18,555 crore allocated for capital expenditure includes modernisation related expenditure.

Deceptive figures

The ‘transparent’ military expenditures on websites show an increase of only 9.37 percent. But, if we add to it the concealed provisions, the increase would balloon manifolds.  The concealed provisions include quasi-defence allocations like border and strategic roads, nuclear/space research, paramilitary forces like Border Security Force, Central Reserve Police Force, and so on.  Besides, there are public-sector undertakings like dockyards, machine tool industries (Mishra Dhatu Nigham), and Bharat Heavy Electrical Limited.

Then, India unnoticeably increases its defence expenditure under Revised and Actual budget estimates. But the real expenditure in past years has been much greater than that exhibited on websites. In the past, India increased its military outlays in revised and then actual estimates.  Thus the actual military expenditure is much higher than the initial estimates, quoted in international media under a hypnotic spell.

Why India does so?

It does so to ‘lower’ its military budget as proportion of its gross national product (GNP). Through such ploys, India, as compared with its neighbours, gets a favourable image in The Military Balance, Jane’s Defense, and other international magazines.

Without a hard copy of Explanatory Memorandum to Demands for Grants, it is difficult to analyse the budget. The memorandum could throw light on India’s mega purchases. They include carbine rifles for army, Advanced Jet Trainers, Airborne Warning and Control system, additional Mi-17 Helicopters, MiG-29 upgrade, Low-Level Transportable Radar, Integrated Air Command and Control System and Surveillance Radar Element in respect for the air force. Weapon Locating Radar and T- 72 upgrade in respect of the Army, Rafaels, so on.

During his visit to India, president Trump of the United States It offered to sell India US$ 3 billion (per one unit) Terminal High Altitude Area Defense (THAAD) and Patriot Advanced Capability (PAC-3) missile defence systems as an alternative to the Russian S-400 system. India ditched Russia from whom it had decided to purchase five S-400s Russian S-400s air defence systems at cost of US$5.4 billion. With US tacit support, India is getting tougher with China. There was a 73-day standoff on the Doklam (Donglang in Chinese) plateau near the Nathula Pass on Sikkim border last year.

Pax Indica

At us prodding, India revised its maritime strategy in 2015 to “Ensuring Secure Seas”. The previous strategy was “Freedom to Use the Seas. To implement the new strategy, India built the Chabahar port. India took up the development of the Sittwe Port in Myanmar as part of the Kaladan multi-modal transit transport project for building a multi-modal sea, river and road transport corridor for shipment of cargo from the eastern ports of India to Myanmar through Sittwe. India upgraded its existing listening post in northern Madagascar.

India has obtained access to the US naval base in Diego Garcia, and to the French naval bases in Mayotte and Reunion islands, besides Australian naval base in Cocos (Keeling. Robert Kaplan, in his book, Monsoon: The Indian Ocean and Future of American Power, argues that the geopolitics of the twenty-first century will hinge on the Indian Ocean. Waters of the Indian Ocean reach 28 countries which together account for 35 per cent of the world’s population and 19 per cent of the world’s Gross Domestic Product. Sixty per cent of the world’s oil shipments from the Gulf countries to China, Japan and other Asian countries pass through these waters which host 23 of the world’s busiest ports.

Nuclear/Chemical capability

It  is pertinent to mention that Robert S. McNamara, in his address to the World Bank Annual Conference on Development Economics at Washington, DC, as far back as on April 25, 1991 inter alia classified India among the’ Countries reported by the Western governments as seeking a CW capability or suspected to be possessing chemical weapons’. The explanatory footnote to the Table 111-2: Distribution of Chemical Weapons, 1990, states that the classified countries denied possession of chemical weapons, or intentions to acquire such weapons (Source: The Post-Cold War World and its Implications for Military Expenditures in the. Developing Countries, by Robert McNamara).

Methyl isocyanates were being produced at the Union Carbide India when it exploded killing thousands of people. There were 27 factories producing products including Carbaryl through cyanates supplied by UCIL. Vizag Gasl Leak also has military potential. Where does provision for CBW research appears in India’s military budgets.

The Washington Post reported in 2013 that the police in occupied Kashmir published a notice in the Greater Kashmir (now under black out), advising people about nuclear-war survival tips. The tips included constructing well-stocked bunkers in basements or front yards, and having a stock of food and batteries or candles to last at least two weeks.

Colossal expenditure on conventional weapons by a nuclear power is not understood. Nuclear deterrence does not mean matching bomb for bomb. Nuclear victorywould at best be pyrrhic.

A US proxy

India is emerging as the US proxy against rising China, which is determined to surpass the USA in GDP by 2027. India is opposed to China’s Belt and Road Initiative. Besides, it uses its aid, trade and border contiguity to obstruct Chinese influence in Bhutan, Nepal, and Bangladesh.

At India’s bidding, those countries toe the Indian line in SAARC and other international forums like G-20. In 2005, Washington expressed its intention to help India become a major world power in the 21st century (according to K. Alan Kronsstadt, Congressional Research Service Report for Congress, 13 February 2007). It was later re-affirmed by Ambassador David Mulford in a US Embassy press in 2005.

Henry Kissinger views Indian ambitions in the following words: ‘Just as the early American leaders developed in the Monroe Doctrine concept for America’s special role in the Western Hemisphere, so India has established in practice a special positioning the Indian Ocean region between East Indies and the horn of Africa. Like Britain with respect to Europe in the eighteenth and nineteenth centuries, India strives to prevent the emergence of a dominant power in this vast portion of the globe. Just as early American leaders did not seek approval of the countries of the Western Hemisphere with respect to the Monroe Doctrine, so Indian in the region of its special strategic interests conducts its policy on the basis of its own definition of a South Asian order’ (World Order, New York, Penguin Press, 2014).

Zbigniew Brzeszinsky takes note of India’s ambition to rival China thus: ‘Indian strategies speak openly of greater India exercising a dominant position in an area ranging from Iran to Thailand. India is also position itself to control the Indian Ocean militarily, its naval and air power programs point clearly in that direction as do politically guided efforts to establish for Indi strong positions, with geostrategic implications in adjoining Bangladesh and Burma (Strategic Vision: America and the Crisis of Global Power).

To woo India firmly into its fold, the USA offered to sell India Terminal High Altitude Area Defense (THAAD, for $3 billion per unit) and Patriot Advance Capability (PAC-3) missile defence systems as an alternative to the Russian S-400 air defence system. India ditched Russia from whom it had earlier decided to purchase five S-400s at a cost of $5.4 billion.

Inferences

Any analysis of India’s military budget should be based on actual Demands for Grants coupled with Explanatory memoranda. The allocations concealed under civil ministries outlays should be ferreted out and added to military allocations. The successive increases n revised and then actual budget estimates should be taken into account. As a result of India’s rising military expenditures, Pakistan also increases her defence expenditure.

India’s Defence Budget for FY2020-21

Strategic Implications for Pakistan

India’s burgeoning defence pension costs provide adequate time and space for Pakistan to develop indigenous solutions as well as encourage transfer of technologies from friendly countries, particularly China and certain European countries. Pakistan has so far made up for its lack of conventional firepower superiority by improving the potency and accuracy of its strategic arsenal. This pragmatic course of action has, however, not reduced the international political and diplomatic pressure to rein in what many proclaim is a ‘growing’ and ‘unjustified’ nuclear stockpile.

The new defence budget can impact the Indian Army’s offensive combat capabilities and the Indian Navy’s strategic ambition to attain dominance of the high seas in pursuit of the Washington-led ‘Indo-Pacific’ strategy. Therefore, although Indian Armed Forces’ modernisation remains a distant dream, the lack of hardware can be compensated through diversion of funds to build-up integrated tri-services capabilities in the Cyber, Outer Space and Special Operations domains.

From Pakistan’s perspective, India’s defence budget for FY2020-21 rationalises the BJP’s continued preference for Special Forces to make-up for conventional force limitations; these although tactical in nature, these so-called ‘surgical strikes’ incur strategic ramifications for all stakeholders. Moreover, diminishing funds for operational costs helps the union government justify testing of strategic missiles including ICBMs.

Even if the Indian Finance Commission approves a separate funds-generation mechanism for defence acquisitions (as proposed by the Ministry of Defence), it will take a considerable time to materialise in view of India’s lethargic bureaucratic structure. For Pakistan, therefore, the current strategic threat spectrum from India remains unchanged.

In the aforementioned context, the federal government would be wise to prioritise force modernisation of Pakistan Navy in the next budget.