Jun 19, 2016
A combination of factors such as robust economic growth of over 6 percent for the past five years and in general during the decade, aspirations of the country to play a larger geo-political and security role manifesting in participation in the UN Peace Keeping, traditional insecurities in relation to the larger neighbour India and Myanmar, increase necessity for security of resources particularly in the EEZ, geo-political push by external players as China and marketing by global defence majors and rising trend of violent extremism are some of the factors that is leading Bangladesh to increase investment in defence and security. This was evident with a 20.3 percent increase in the defence allocations for 2016-17 and over two and a half times more increase at 55 percent in the allotments to Ministry of Home.
The Finance Minister of Bangladesh Abul Maal Abdul Muhith thus proposed an allocation of Tk 221.15 billion (US $ 2.81 Billion) for the Ministry of Defence in a total national budget of Tk 3.14 trillion for the 2016-17 fiscal in Parliament on 2 June. The enhancement is of Tk 37.47 billion over the allocations to the Ministry of Defence in 2015-16 fiscal (July to June) and Tk 14.36 billion more than revised allocations. In the 2015-16 fiscal, the defence ministry was given Tk 183.83 billion (US $ 2.34 Billion) which was later revised to Tk 206.94 billion (US $ 2.63 Billion). “Our efforts to improve the capacity and efficiency of army, navy, air force and border guards as well as to modernise them will continue,” Muhith said in his budget speech.
However there was a surprise in store as Muhith enhanced allocations to the Ministry of Home Affairs by 55 percent. Thus from a budgeted allocation in 2015-16 of Taka 12403 Crore (US $ 1.57 Billion) and a Revised allotment of Taka 15980 Crore (US $ 2.03 Billion) the Ministry of Home Affairs has received Taka 19298 Crore (US $ 2.45 Billion) for 2016-17. This is possibly the largest single year rise in the budget for internal security which has now touched almost at par with the Ministry of Defence short only by US $ 360 million. The total increase year on year in the defence and security budget is thus over 75 percent. The increase in allocations for internal security possibly reflects the priority given to counter terrorism in the light of recent challenges with rise in extremist violence in the country targeting minorities, liberals and foreigners. The government is taking this threat seriously after the international community called for more stringent security measures.
The overall trend in the defence budget in Bangladesh is in conformity with the norms since 2008 wherein there has been a uniform annual increase by approximately 20 percent. What is however surprising is that despite the ambitious plan of long term modernisation of the Armed Forces - Forces Goal 2030, the main accretion is in revenue expenditure that is pay and allowances which have seen an increase across the board of 40-45 percent. The revenue to capital ratio of the armed forces is low at 65:35 and but for the Bangladesh Navy the plan for acquisition of assets seems to be sputtering. In line with this trend there is substantial increase in the capital acquisitions for forces coming under the Ministry of Home Affairs year on year of 105 percent. Recognising the need to assuage the minorities allocations have also been made for upkeep and maintenance of minority institutions.
When compared to defence budget of neighbours as India, the Bangladesh Defence Budget may seem very limited being about one twentieth the size of the Indian budget. The budget is however comparable to that of Myanmar which has spend approximately US $ 2.37 billon on the military in 2014 as per SIPRI though the data has been classified as uncertain. The challenges faced by India and Myanmar are varied from that of Bangladesh which has a generally benign external environment thus there would be questions raised on the necessity for a developing country to spend such large quantum of monies particularly on defence and with an ambitious plan such as the Forces Goal 2030. Are there any real time threats to the sovereignty of Bangladesh? Yet nations prepare their armed forces not on possible intents for intentions can change overnight but on the baseline of capacities required in case such a change manifests. An underlying aspiration to play a larger role is also evident in the investments.
Evidently the defence and security budget of Bangladesh for 2016-17 is designed to create capacities in the armed forces as well as the police and paramilitaries including the Coast Guard. How the allocated resources are utilised will determine security and stability at a time when there is a clear threat of rising extremism and terrorism looming large on the horizon while building capacity for traditional challenges which manifest in the long term remains to be seen?.
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