Defence Budget

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  • Need for a Resource Generation and Management Cell in Defence

    The orientation of the existing administrative set up in Service Headquarters and in departments under the Ministry of Defence is to plan for the utilization of defence budget allocation. They are not in a position to pay attention to the aspect of defence receipts.

    November 05, 2009

    Defence Budgeting: Trends and Issues

    The defence budget for the financial year 2009-2010, even though in terms of percentage increase appears large, yet it is not actually so. There has generally been a mismatch between the funds asked by the MOD and those allotted by the MOF. The absence of indication of likely availability of funds impacts adversely the defence planning process. Of late, there has been improvement in the ratio of revenue to capital expenditure, but for a healthy ratio there is a need to increase the defence budget as a percentage of the GDP.

    October 2009

    Economic Downturn: Options for MoD

    The present global economic crisis has slowed down the growth of the Indian economy, affecting among others, the fiscal situation and the revenue mobilisation potential of the central government. Defence being one of the largest recipients of central government expenditure, the present crisis casts a doubt on the adequacy of future resources. This commentary discusses some major options that India’s Ministry of Defence needs to consider in order to withstand the likely resource constraints in the coming years.

    May 26, 2009

    Rationale for Performance Oriented Defence Budgeting

    Fellows' Seminar
    March 20, 2009
    1030 to 1300 hrs

    India’s Defence Budget 2009-10: An Assessment

    In its interim budget for 2009-10 the Union Government has allocated Rs. 1,41,703 crores for the country’ Defence Services that include three Armed Forces (i.e., the Army, the Navy and the Air Force), and other Departments, primarily Defence Research and Development Organisation (DRDO) and Defence Ordnance Factories. This is apart from Rs. 24,960 crores which have been earmarked to defray civil expenditures of Ministry of Defence (MoD) and its affiliated organisations, including, the Coast Guard, and for defence pension (Rs. 21,790 crores).

    February 18, 2009

    Budget Utilisation and Accountability

    Every year as India approaches the Budget session of Parliament, there are debates in various forums about the adequacy of Budget allocation to meet the modernization plan of the Services considering the threat perceptions/scenario. Due to the economic slowdown world-wide which is likely to affect the revenue collection of the national exchequer this year, the Government may face difficulty in meeting the increased demand from the Defence Forces. Further, we should not forget that electoral compulsions are also likely to play an important role in the coming budget.

    January 21, 2009

    Budgeting for Desired Defence Capability

    The Defence procurement policy and procedure as brought out in DPP- 2006 (Defence Procurement Policy, 2006) indicated that for policy decisions relating to acquiring of weapons and systems, we are basing them on capability planning in the context of operational requirements. It talked in terms of existing 'capability gaps', and examination of alternative means of overcoming them, while processing a case for policy decision.

    Winter 2008

    Defence Budget as a Strategic Tool of National Security

    The practice of converting defence plans into publicly known defence budget is essentially a practice of democratic governments. One reason for public disclosure of defence spending could be that tax payers expect to know directly or through their representative how much is being spent on national defence and on other sectors of economy which affects their security and welfare. Disclosing the defence budget even to the domestic audience was rarely done in the past. In fact, even today, some major powers do not disclose their defence spending to the world.

    May 30, 2008

    India’s Defence Budget 2008-09

    Union Budget 2008-09 has allocated Rs. 105,600 crores for India’s Defence. Crossing the one lakh barrier for the first time, and accounting for nearly 14.1 per cent of total central government expenditure, the Defence Budget looks quite impressive (see Box). But when seen in the context of India’s expanding interests, this allocation remains as moderate as ever. Moreover, an in-depth analysis reveals problems in defence and budgetary management, none of which show signs of abating.

    March 19, 2008