Shrinking hemlines

The Indian Army is calling it blue murder. Why? Due to lack of sufficient government initiative, their most important weapons systems are fast depleting. Operational capabilities are being hit. The military top brass says the time for lip service to defence preparedness is over; the need is to take the arms modernisation programme to another level. The question is, will it happen?  

Insiders say the basic military hardware required for any warfare - artillery guns, air defence guns and missiles, light helicopters, night fighting capabilities and strike capability in high altitude – are fast running out, if they are not already gone. Among a plethora of other reasons, this slack defence preparedness is due to faulty defence budgetary allocation. Although the finance minister hiked the defence budget by 5.3 percent to Rs 2,03,672.1 crore (US$ 37.4 billion), there are wheels within wheels. The 2013-14 defence budget is pegged at Rs 1,93,407.29 crore but faces the twin threats of high inflation and an adverse rupee-dollar exchange rate. Military insiders say it will make even the current level of preparedness difficult to maintain.

Modernisation is a continuous process; no military in the world can boast a permanent state-of-the-art weapons system, From time to time, given the high level of Research and Design (R&D), arms are bound to become obsolete. It calls for a cautiously drawn mixture of state-of-the-art, obsolescence and obsolete weapons and systems.

What is the composition? Explains an Indian Army officer dealing with planning and modernisation issues, "Around 15 to 20 percent is state-of-the-art, about 60 percent falls in the obsolescence list, still in use and not yet obsolete, and around 15 to 20 percent comes under the obsolete category.” But alarm bells are ringing as most of the arms and equipment are approaching their limits. The only thing that can help is money or indigenisation, both of which are not evident anywhere on the horizon.

As early as May 2012, the Ministry of Finance mandated a 10 percent cut in all non-plan expenditure excluding subsidies, interest payments, salaries, etc. It is important to remember that all defence expenditure comes under non-Plan expenditure. This has resulted in a nominal reduction in defence revenue expenditure but the reduction in defence capital expenditure has been substantial, amounting to Rs 10,000 crore which caters for modernisation and procurement.

It appears as if austerity is meant primarily for the Ministry of Defence (MoD). Of particular concern to the army is the further decline of the share of the defence budget in GDP, which is now the lowest since the past five decades since 1961-62, a throw back to the Indo-China border conflict, when it was only 1.66 percent. It is 1.79 percent of the current GDP which was 1.90 in 2012-13. Naturally, the army will have to take the burden of this reduction.

The army with an approximate budget of Rs 99,707.8 crore,  accounts for 49 percent of the defence budget followed by the Indian Air Force (Rs 57,502.9 crore) and Indian Navy (Rs 36,343.5 crore). Although, the navy’s share has decreased the most by 1.4 percentage points, the army’s share has declined by 1.3 percent.

Last year, the army with an approximate budget of Rs 97,302.54 crore accounted for 50 percent of the defence budget which was down by one percent; out of this the modernisation budget of the military had declined by three percent to Rs 13,804.02 crore.

This year, in 2013-14, the air force is the only service which has increased its share in the total defence allocation from 24.9 percent to 28.2 percent. According to MoD officials, the reduction in defence capital expenditure was arbitrarily taken by the Ministry of Finance.

But the problem is not confined only to allocation of funds. Laxman Kumar Behera, Research Fellow at Institute for Defence Studies and Analyses (IDSA), says that in the past few years, the MoD has not been able to utilise a large sum of money, particularly in the capital acquisition segment of the budget which is also the main source of the modernization plans. Between 2002-03 and 2011-12, the underutilised money touched a staggering Rs 35,500 crore mark.

There are still no accurate estimates of how these reductions and under utilisation in defence expenditure will finally impact the defence acquisition and modernisation programme. The reality on indigenous defence production does not make for pretty reading. Ordinance factories are taking years to assimilate even those expensive technologies which India is buying from other countries under various transfer of technology agreements. As far as the budget allocated for R&D is concerned, the less said the better – at the moment it remains pure lip service.

Says Behera, an expert on defence budgeting, "The focus on indigenisation has become a lip service as the budget shows. This is evident from the utilisation and allocation of resources for the ‘Make’ projects under which domestic industry, particularly private sector, is required to design and produce advanced platforms for the armed forces. Of the total allocation of Rs 89.2 crore made in 2012-13, not a single rupee was utilised. Now, the allocation has been slashed to a mere Rs 10 crore in the new budget.”

India's position becomes particularly precarious when contrasted with the defence modernisation programmes of its powerful neighbour. China, the world's largest growing economic and military power, has been modernising at a rapid pace for over a decade, backed by a double-digit annual hike in its defence budget. At $ 115.70 billion, China’s official defence budget for 2013-14 is 10.7 percent more than the previous year and it is over three times India’s planned defence expenditure.

Under the shadow of a declining budgetary allocation, the army has a difficult road ahead. Within the army, the Artillery Corps is the most overlooked, despite the recent acquisition from the US of 145 pieces of Ultra Light Howitzer M 777. Army sources told TSI that the ‘Letter of Acceptance’ is to come by the end of this month, and within a year the equipment will start arriving. The Artillery is also trying to indigenously produce 155 mm 45 calibre guns. Ordinance factories have produced two prototypes and field trials were completed in February at Pokharan. This gun will have a range of 38 km compared to the Bofors howitzer, which has a range of 30 km. Its validation firing is scheduled to be held by March-end. In addition, upgradation of the 130 mm self-propelled gun is in the works – it will be fitted with the chasis of Arjun Mark II by the Defence Research and Development Organisation (DRDO).

According to military officials, the Armoured Corps is working hard to meet critical requirements like night-blindness of the tank regiments and equipping them with modern fire and control systems. Sources say that 784 T-90 Tanks are being modernised and orders for 236 more upgraded T-90s have been placed with the Heavy Vehicle Factory Avadi, Chennai.

Mechanised Infantry too has cause for concern. Says an army source, "The BMP fleet modernisation programme is in progress to improve offensive capabilities. Efforts are on to equip them with twin missile launchers, modern fire and control systems and other offensive systems.'' Army sources say that steps to make the Engineering Corps capable enough to operate in a nuclear, biological and chemical environment are underway. Meanwhile, the Army Air Defence is struggling to find solutions to its own problems of obsolescence.

In the current scenario though, it appears that a lack of sync between the military and largely civilian MoD is hampering the army's modernisation programme. A decreased budget has hardly helped matters.

mayank.singh@thesundayindian.com