Budget likely to raise military spending slightly, delaying modernisation

The army, a large part of which is deployed on the border with traditional foe Pakistan, has been seeking everything from assault rifles to surveillance drones and body armour.

The government is likely to stick to a modest rise in defence spending in the 2019/2020 budget due on Friday because of government finances, officials said, further delaying a long-planned military modernisation programme.

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India's air force desperately needs hundreds of combat planes and helicopters to replace its Soviet-era aircraft while the navy has long planned for a dozen submarines to counter the expanding presence of the Chinese navy in the Indian Ocean.

The army, a large part of which is deployed on the border with traditional foe Pakistan, has been seeking everything from assault rifles to surveillance drones and body armour.

But these plans have been on hold for years because governments have not been able to set aside large sums and most of the defence expenditure goes on salaries and pensions for a 1.4 million standing military, the world's second largest after China.

In an interim budget announced in February before national elections, the government allocated Rs 4.31 trillion ($62.27 billion) for defence, a 6.6 per cent rise over the previous year, raising concern at the time it wouldn't be enough for modernisation.

But a finance ministry official told Reuters there was unlikely to be any change to that allocation when Finance Minister Nirmala Sitharaman presents the federal budget in parliament.

"Defence is our major spending and we give it as much as the budget allows. But this year, a significant rise to what has already been allotted looks difficult," the official involved in the budget preparations said.

China, by contrast, in March announced defence spending of around $180 billion, a 7.5 per cent increase over 2018 and faster than the economic growth target. While China doesn't give much break-up, it is largely assumed that a substantial portion of it goes towards modernisation, helped also by a cutback in maintenance costs.

Since Chinese President Xi Jinping took office in late 2012, he has made strengthening and modernising the military a very key part of his policy platform. Part of that has been reduction in troops by about 300,000 and the money saved in this is invested in much more advanced equipment and research and development.

Business Standard