Defence unimpressed by 10% hike

Tags: News

The defence budget accounts for nearly 17.2 per cent of the total central government expenditure for the year 2016-17

Despite finding no mention in finance minister Arun Jaitley’s Monday speech, the defence budget was increased by 9.76 per cent to Rs 2.58 lakh crore for the next fiscal.

This comes against a revised estimate of Rs 2.33 lakh crore for 2015-16 even as military pension zoomed to Rs 82,000 crore, essentially on account of the one-rank-one-pension scheme.

The defence budget accounts for nearly 17.2 per cent of the total central government expenditure for the year 2016-17, which sta­nds at Rs 19.78 lakh crore.

Experts, however, were not too impressed. Well-known strategic expert and director Society for Public Studies, U Uday Bhaskar, said that while on the face of it the numbers looked good, “The biggest cut or drop is in the capital component of the defence expenditure, which has shrunk from Rs 98,000 crore, the budgeted estimate in FY 2015-16 while the revised estimate was roughly Rs 85,000 crore,” he said.

Amber Dubey, partner and head of aerospace and defence at global consultancy KPMG, expressed concern at the fall in capital allocation. “One had hoped for a far higher allocation given the growing threat perception and the need for rapid modernisation of the armed forces. The pace of defence procurement has to be shortened drastically to three years or less to ensure latest technology,” he pointed out.

ranjitbhushan@mydigitalfc.com

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