04 March 2015
Arun Jaitley has given step-motherly treatment to defence. Security of the motherland and defence readiness are commitments he had made. Also, the NSA has said that India must be prepared for a two-front war
The statement, “Defence of every inch of our motherland comes before everything else”, sounds hollow, given the step-motherly treatment given to defence allocation in the current Budget, especially after Union Minister for Finance Arun Jaitley had till recently, doubled as Defence Minister. Item 86 of his speech was taken up by the well-meaning but directionless ‘Make in India’ thrust and the claim of being “both transparent and quick in making defence equipment-related purchase decisions, thus keeping our defence forces ready for any eventuality”.
He left out the customary praise of jawans and the promise to provide more money when needed, which traditionally led to thumping of desks. Prime Minister Narendra Modi had made the pitch for ‘Make in India’ at the air show in Bangalore where both the bags and badges given to the media were made in China. Mr Modi decried the fact that India was the largest importer of arms, and said that by 2020, it would be 70 per cent self-reliant.
The Defence Acquisition Council has apparently cleared buy, make and buy and make projects worth two lakh crore rupees, which certainly is quick decision-making. What will be lacking is implementation compounded by complex procedures. At the air show, Mr Modi said: “We are reforming our defence procurement and procedures with clear preference for equipment manufactured in India.” This would be the nth attempt at revising acquisition procedures; this time, including the roadmap for Make in India. Not a single rupee or dollar has been invested in the flagship project since it was launched nine months ago.
Rather, most of the ‘buy and make’ projects are being converted into ‘make’, which is bound to lead to still more cost and time overruns. A proper understanding and clarity of the fundamental difficulties of the Make in India takeoff is missing. Many long-delayed projects like the artillery gun and helicopters are straddling ‘make and buy’. Our ‘make’ record is dismal and distressing. A project to acquire 197 light helicopters from abroad has been scrapped thrice in the last decade. Hindustan Aeronautics Limited is nowhere near the delivery of 187 helicopters it was to make within 60 months from February 2009.
Meanwhile, since 2011, India has lost 28 aircraft, including 14 from the ageing Cheetah and Chetak fleets, leading service officers’ wives to form an organisation to protest the unsafe military equipment and also to file public interest litigations in the court. A battle royal was waging between Indian Air Force in its demand for purchasing more Pilatus trainer aircraft, with HAL insisting that it will provide the under-development HTT40. The compromise: Purchase of 38 Pilatus and the remainder 68 aircraft being made by HAL making a hotch-potch of basic training of pilots.
Security of the motherland and defence readiness of the Armed Forces are commitments made by Mr Jaitley at a time when National Security Advisor Ajit Doval told a Hindustan Times summit recently that India has to be prepared for a two-front war. Parliament’s Standing Committee on Defence lambasted the Government for not providing the Army the funds it sought to keep its fighting spirit high and ready to move in any eventuality. Noting the continued shortfall of bullet-proof jackets sanctioned in 2009, it criticised the Ministry of Defence for providing neither funds nor equipment for the mountain strike corps. The committee was told by the Vice Chief of Army Staff, Lieutenant General Philip Campose, that “we have dipped into our War Wastage Reserve”, which is actually equipment in reserve for war-time for initial raisings. As no additional funds have been provided, funds have had to be diverted. So much for operational preparedness for any eventuality, leave alone a two-front war.
What was not stated by Mr Jaitley was the fact that Rs12,623 crore from the capital account meant for critical modernisation of the Armed Forces, remained unutilised last fiscal. Of this amount, Rs6,000 crore was transferred to the revenue account and the balance lapsed. The failure of the ministry to spend its capital budget has been debated for years. Listless Defence Minister AK Antony’s only legacy was his claim of utilising in full, the capital account. Innovative practices of the past, like parking unused funds with Defence Public Sector Undertakings, are no longer available.
Simply recalling a thousand crores from the capital account to balance the fiscal deficit is also a regular feature. Messrs Manohar Parrikar and Jaitley must ensure that modernisation of the services is not interrupted by incapacity to utilise funds and it is apace with developing eventualities. Defence Minister Manohar Parrikar has twice told the media that his speciality is sticking to procurement targets. He should now walk the talk.
This year’s capital allocation is precisely the same amount as last year: Rs94,588 crore. Much of this money will be consumed by committed liabilities, inflation and the falling value of the rupee. The IAF, which has the largest share of capital, has not been given additional funds for the long-delayed 126 Medium Multi-Role Combat Aircraft, Rafale, which is stuck over price and Dassault’s refusal to underwrite HAL’s ‘Make in India’ of 108 Rafale. The IAF has discounted rumours of the project being scrapped or of a Plan B.
Air Chief Marshal Arup Raha has said that the Sukhoi MKI is no substitute for the Rafale, as the two aircraft are not comparable. The Standing Committee on Defence has pulled up the MoD for a “lackadaisical and callous approach towards upgradation of Air Force squadrons” which have shrunk to 25 squadrons against sanctioned strength of 42. The IAF had recently said it had 32 squadrons.
The reasons attributed for the decline are chronic delay in operationalising the light combat aircraft and the avoidable delay in the induction of Rafale. It noted that by 2024, the squadron strength could fall to just 11 squadrons making meeting the two-front scenario an exceptional challenge. The Army and Navy have bigger holes to plug.
This year’s Defence budget is one of the lowest increases and also low as a percentage of gross domestic product (1.75 per cent). The stasis in modernisation account is striking. Good intentions and tidy slogans cannot make up for an untidy defence planning and procurement system which is due to leaving defence reform begun by the previous NDA Government half done. As long as the Defence Secretary and not the Defence Minister is responsible for the defence of India and Service Headquarters remain attached office of MoD, the third largest Armed Forces of the world will stagnate. For the defence of motherland, big bang reforms are required.
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