Security experts have viewed as marginal the 34 per cent hike in the defence allocation in the interim budget for 2009-10 presented in the Lok Sabha on Monday, pointing to the armed forces returning Rs 7,000 crore from what had been earmarked for arms purchases during the fiscal ending March 31.
"On the face of it they are talking about an increase of 25 per cent (in real terms) but much of it is going to be used to pay arrears to the armed forces personnel after the (hikes recommended by the) Sixth Pay Commission," defence analyst Commodore (retd) C Uday Bhaskar told IANS.
Maintaining that a "threshold has been crossed" with the Mumbai terror attacks, the Indian government hiked the allocation to Rs 141,703 crore (Rs 1.417 trillion) in the interim budget for 2009-10 that External Affairs Minister Pranab Mukherjee presented.
In real terms, however, the budgetary hike works out to only 23.6 per cent as the revised expenditure for 2008-09 has been placed at Rs 114,600 crore against the allocation of Rs 105,600 crore. Taken together, the three services will see Rs 43,811 crore or nearly 54 per cent of their budgetary allocation going towards pay and allowances.
This apart, the armed forces have surrendered Rs 7,000 crore (Rs 70 billion) out of the Rs 48,000 crore allocated for 2008-09 - at a time when they have been crying hoarse about serious operational shortfalls of tanks, artillery, aircraft, ships and other military hardware.
"We have an anomalous situation here as the armed forces are returning money meant for capital expenditure. This means that the increase of holistic capability of the armed forces has not been adequate. I am afraid that the trend of money being unspent shows that the modernization process of the armed forces has not been carried out," Bhaskar maintained.
"It (the money being unspent) is a crying shame that when obsolescence is staring you in your face. It is a systemic failure when the finance minister allocates money but the defence minister is unable to spent it. The suggestion that Mumbai can be averted by mere increase in defence budget is a red herring," Bhaskar added.
Former Indian Air Force chief Air Chief Marshal S Krishnaswamy said, "I do not believe that Mumbai terror attack has made in difference in terms of plan and expenditure. I don't think the armed forces need anything more than their plan of procurement unlike police and the Coast Guard.
As in the past, the 1.1 million strong Indian Army has received the lion's share of 41 percent or Rs 58,648 crore, with the Indian Navy being allocated Rs 8,322 crore and the Indian Air Force Rs 14,318 crore.
Interestingly, the army's allocation is even greater that the Rs 54,824 crore set aside for capital expenditure for all three services.