India will continue to confront formidable security challenges in the neighbourhood, but needs to exercise prudence in defence acquisition plans due to the economic slowdown, Prime Minister Manmohan Singh said Friday.
Addressing the combined commanders' conference here, the prime minister also said the country needs urgent and tangible progress in establishing right structures for higher defence management and appropriate civil-military balance in decision making.
He also highlighted the political leadership had highest faith in the military's institutional rectitude.
The prime minister said though the country needs to take into account the capabilities of its adversaries, the long-term acquisition had to be planned on the assumption of limited resource availability.
"We need to match our investment in military equipment and forces to our national resources. During most of the past decade, we have had the benefit of average annual growth rates of eight percent.
"But the past two years have seen slow growth, uncertain international economic climate marked by volatile exchange rate fluctuations and the possibility of fragmenting trade regimes," he said.
Manmohan Singh said he had no doubt the country would overcome current economic slowdown, but "we will have to exercise prudence in our defence acquisition plans and cut our coat according to our cloth".
The driving principle was to create a military that is driven by abiding interests, as opposed to the transient threats, he said.
Referring to the role of internet in the age of globalisation and worldwide surveillance done by the US, he said India needs to develop comprehensive national power, which he defined as the "amalgam of economic, technological and industrial prowess, buttressed by the appropriate military sinews".
The prime minister said India must take advantage of a favourable international environment to build a domestic defence industrial base.
"For too long, we have debated the merits of private versus public sector. It would be more useful to think in terms of aggregate national capacity," he said.
He said that just as economic pendulum is shifting inexorably from west to east, so is the strategic focus, "as exemplified by the increasing contestation in the seas to our east and the related 'pivot' or 'rebalancing' by the US in this area".
He however sounded a note of caution too.
"This, to my mind, is a development fraught with uncertainty. We don't yet know whether these economic and strategic transitions will be peaceful, but that is the challenge this audience must grapple with institutionally," he said.
Referring to "continuing turmoil in West Asia" and Asia Pacific region, he said the country's strategic horizons should also include the need to protect its global seaborne trade in goods, energy and minerals, the well-being of Indian expatriate communities worldwide and the growing global footprint of Indian capital.
Noting recent concerns raised about the nature of civil-military relations in the country, he said: "Let me assert, clearly and unequivocally, that the political leadership of India has the highest faith in its military and its institutional rectitude within the democratic framework."