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Defence budget may touch Rs. 2 lakh crore

NEW DELHI: The coffers of the Ministry of Defence are likely to swell considerably in the upcoming budget. When Finance Minister Pranab Mukherjee presents the Union Budget for 2012-13 in March

Published: 19th February 2012 02:06 AM  |   Last Updated: 16th May 2012 05:58 PM   |  A+A-

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NEW DELHI: The coffers of the Ministry of Defence are likely to swell considerably in the upcoming budget. When Finance Minister Pranab Mukherjee presents the Union Budget for 2012-13 in March, the annual defence budget is likely to touch `2 lakh crore to keep the Armed Forces’ modernisation drive going full throttle.

For 2011-12, the defence budget had seen a hike of 11.6 per cent and if the trends and the need of the Armed Forces, which are modernising for a two-pronged defence of the country against rising China’s aggression in the East and growing instability in Pakistan on the West, are anything to go by, even 8 per cent hike will take the budget closer to `2 lakh crore.

“Our defence budgets have seen an increase equivalent to 5-8 per cent. Increasing it by 8 per cent will roughly take it to the figure of `2 lakh crore. Also, the increase has to be done keeping in mind the value of Rupee in the international market,” former chairperson of the National Maritime Foundation (NMF) Commodore (Retd) Uday Bhaskar told Express.

In 2011-12, the total budget allocated was `1,64, 415 crore, which comes out to be 2.5 per cent of the GDP. Out of this `95, 216 crore was revenue expenditure and `69,199 crore for modernisation of the Armed Forces.

There has always been a clamour from the think tanks to hike the country’s defence budget to at least 3 per cent of the country’s GDP in the wake of the huge defence spending by China and Pakistan. But the piling amount of unspent modernisation budget has been the main impediment in the way of this hike. As the Defence Ministry has succeeded in spending its complete budget for the second consecutive year in 2011-12, the demand will find more takers.

Presently, all the three Armed Forces, Army, Navy and Air Force, are on the cusp of transformation and huge deals for platforms and weapons with the cutting edge technology are expected to be finalised in the 2012-13.

Among the deals in the final stages include 126 fighter jets for $20 billion, six mid-air refuelling aircraft for $2 billion, 75 trainer aircraft for $ 1 billion, 197 utility helicopters for $750 million, 22 attack choppers valued at $600 million and GE F414-INS6 engines for indigenous Light Combat Aircraft (LCA) Tejas and Harpoon anti-ship missiles estimated at $ 170 million. Besides, about 40 warships of the Navy, including refurbishment of an aircraft carrier and nuclear-powered submarine, are under construction at home and abroad. In view of this, defence experts seek a reversal in the ratio of capital.



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