Defence allocation sees moderate rise, IAF gets largest capital boost

Notwithstanding a still sluggish economy, and sustained military pressure on the Army from multiple intrusions by Chinese troops on the border in Ladakh, the government has raised defence allocations for financial year 2022-23 (FY23) by less than 5 per cent, compared to the Revised Estimates for FY22 and by almost 10 per cent over BE 2021-22.

The government had allocated Rs 4.78 trillion for BE 2021-22. In the Revised Estimates for 2021-22, that was raised to Rs 5.02 trillion. In the Budget FY23, the government has allocated Rs 5.25 trillion.

While the 1.3-million-strong Army has been given the bulk of the revenue and pension budgets, the Indian Air Force (IAF) has been allocated the biggest share of the capital allocation: Rs 55,587 crore, or about 10 per cent more than what the IAF got last year.

The IAF faces a continuing burden of payments for 36 Rafale fighters it bought in 2016, modernisation of the Mirage 2000 and Jaguar fighter fleets, and the manufacture of Sukhoi-30MKIs and Tejas fighters by Hindustan Aeronautics Ltd (HAL). There is also a large expenditure looming on a tender for 114 multi-role fighters, for which the IAF has initiated a global procurement.

To the Army’s credit, it has deployed a large number of troops and equipment to the Ladakh frontier without seriously overshooting its revenue budget, from which payments for such a deployment is made.

Meanwhile, the Navy has been given a capital budget of Rs 47,591 crore, about the same as the preceding year’s allocation. The Army has once again been allocated the smallest share: Rs 32,015 crore.

Indicating the intent to keep money flowing to indigenous research & development (R&D) projects, the Defence Research & Development Organisation (DRDO) was allocated a healthy capital budget of Rs 11,982 crore.

After years of lip service to funding prototype development under the Technology Development programme, the government this year allocated a relatively healthy Rs 1,365 crore for prototype development under the “Make” category of acquisitions.

In what would have come as a relief, the Ministry of Defence (MoD) has managed to stabilise pensions. The pension allocations were kept at Rs 1.19 trillion, up by Rs 2,818 crore.

With an emphasis on infrastructure building by the military, the capital segment of the MoD (Civil) budget, which caters to organisations such as the Indian Coast Guard, Border Roads Organisation (BRO) and Directorate General Defence Estates, has seen a notable jump of 55.6 per cent. In absolute terms, the capital allocations under these heads is Rs 8,050 crore in FY23 — up more than 50 per cent against the allocations of Rs 5,173 crore in FY22.

With the aim of strengthening border infrastructure, the BRO’s capital budget has been increased by 40 per cent, from Rs 2,500 crore in the current year to Rs 3,500 crore.

“This will expedite the progress of creation of border infrastructure including important tunnels (Sela and Naechiphu tunnel) and bridges on major river gaps,” stated the MoD in a statement on Tuesday.