Is it enough???? Especially with the kind of projects cleared by GoI
That's the question, with the list of projects that were not fixed last year, I have some doubts but that's depends on how much of that is actually for procurements.
If we assume 40% of that goes to Capex (although the MoD has stated they would like to get the capex:opex budget ratio around 50:50 if not 60:40 in the capex's favour in the long run but I don't expect much has changed for this year so let's assume 40% of the budget for capex)
So that is $16 BN (40% of around $40 billion), now let's look at the deals to be signed this finical year:
(rounded to the nearest billion)
AH-64E ($1 billion )
CH-47F ($1 billion)
S-70B ($1 billion)
A330 MRTT ($1 billion)
P-8I follow-on, possibly to be signed this year but no rush ($1 billion)
Rafale ($15-16 billion)
A grand total of $20-21 billion in deals waiting to be signed this year (please tell me if there are some I have left out). Considering that for most, if not all, of these deals the MoD will only be paying 10-20% of the total costs up front I would say there was adequate funds in this defence budget to get all these species of kit, what is lacking and has always been lacking is the rapid processing of deals that lead to early signings. The fact is pretty much all of these deals have dragged on 1-2 (if not more) years longer than they needed to. IF the MoD can get a more efficient procurement system in place then such backlogs won't occur and year on year India can be purchasing a hell of a lot more equipment.
people in india dying of hunger or being killed by dogs or idiotic parents or by the exalted tag of "india - suicide capital of the world"... but by all means buy more weaponary.
Hey genius, this is around 1.7% of GDP, show me how many other (major) countries spend such a low proportion of their GDP on defence. The amount India is spending on education, infrastructure, healthcare and poverty alleviation is FAR more.
This is bloody criminal and this is what I mean by the funds are there but it is the mismanagement of the budget and procurements that is the issue. If the MoD/DM succeed in improving the efficiency of tender to signing then the situation will improve many fold.
India needs a 60 billion dollar defence budget and that is a minimum. India spends 2 percent of GDP on defense when the number should be at least 3.5%.
The Chinese have a 100+ billion budget. They have bases all along the Indian ocean, their infrastructure in Tibet outclasses India by a generation. Not a single 155mm artillery gun has been purchased since 1980s. Infantry lacks standard armor vest and NVG, infantry needs modern rifles to replace the junk called INSAS. Tanks and other equipment need upgrades, Radars need upgrades. Army needs to replace its entire air defense units. The needs of Indian armed forces are immense.
If budget constraints restrict spending to 2 percent then India should cut down its million strong army. Better to have 500,000 strong army trained and equipped to NATO standard instead of having 1.2 million army trained just better than pakistanis.
In the current stage of India's growth it is very good that the GoI is keeping defence spending as a proportion of GDP low. Simply put there are better things to spend the money on- the economy, infrastructure, healthcare, education etc which in the long run will all improve India and contribute positively to India's GDP growth which in turn will see the defence budget grow as a byproduct.
As I have been saying, it is clearly not a lack of funding that is crippling the Indian military and capping procurements BUT blatant mismanagement. Even with a $60 billion defence budget the way things stand today many billions of that would be returned to the Fin Min as unspent. The MoD needs to reform the entire procurement process and make the best use of every last ruppee/cent of the defence budget.
Not sure how correct that is.
Signing the agreement doesn't mean immediate allocation of funding IN THIS FY.
Small tranche of money 600-700 million USD (that might be paid upright to Dassault) could be adjusted in this budget itself or as a special provision to be allotted later. There is no point in allotting budget unless a final decision is made (the reports that suggest PMO will take final call).[/QUOTE]
Afaik 15% is the usual immediate payment...
MMRCA $15 to 20 billion = $2.2 to 3 billion
AFAIK it is 10%, this is what NDTV quoted last year when Arun Jaitley was briefed on the Rafale deal so for $15-20 billion $1.5-2 billion and at this rate the funds are there for the Rafale this year, just got to get the deal signed!
But you shouldn't worry about India and its defence budget. You should worry about the Muslims of the world and ensure that they have enough bullets to fire from AK47
