Last year, India decided on a massive 34% increase year-over-year in its defense spending. Here are some frequently asked questions and answers about this dramatic move that puts India among the world's biggest spenders on defense.
Q1: How much does India really spend on defense?
A1: On paper, India spends $30 billion, about 3% of its GDP on defense, after an increase of 34% for 2010.
In reality, India spends closer to 3.5% of its GDP on defense.
Here's what Col.(Retd) Pavan Nair of the Indian Army has to say about it in a recent guest post on Haq's Musings:
India's own specified limit of 3% has been observed only by excluding several items like the cost of the MoD and the expenditure on military pensions which by itself amounts to 15% of the total defense outlay. Several other items like the Jammu and Kashmir Light Infantry (JAKLI, a regular regiment of the army consisting of thirteen battalions) and the Coast Guard are also excluded. A substantial part of the cost of the nuclear arsenal and allied systems is excluded. All para-military forces including the ones directly involved in border management are excluded. The Parliamentary Committee on Defense spends most of its time on personnel matters and resolving issues of protocol between the service chiefs and the defense secretary. The Committee looks at DE but beyond stating that DE should be pegged at 3% of GDP, it has nothing substantial to contribute. Clearly, parliamentary oversight and control seems to be missing. For several years, DE in aggregate has crossed 3% of GDP.
Pakistan spends about $4.3 billion annually, less than 3% of its GDP, and there has been no real increase year-over-year in 2010. There was a 10.15 per cent nominal increase from Rs 311.303 billion revised defense budget for 2009-2010. In real terms, however, it represents a decrease because inflation in Pakistan exceeds nominal increase in defense. Pakistan’s defense allocation does not include foreign assistance, which is expected add about a billion dollars to defense spending for operations against Taliban insurgents. The aggregate $5.5 billion of military spending by Pakistan accounts for about 3% of its $ 175 billion GDP.
“The war on terror has already cost us over $35 billion since 2001-02. We now face the prospects of incurring huge expenditure on account of counter-insurgency,” according to Pakistan's deputy finance minister Hina Rabbani Khar.
Q2: Doesn't India need to spend more on defense to fight the terrorists in the region?
A2: Terrorism is just an excuse by Indian military to get large funds and buy expensive cold war era weapons which are useless against asymmetrical threat from the terrorists any way. It lines the pockets of the arms dealers (and a few corrupt generals and officials) without increasing India's security against potential terror attacks.
The 34% increase can not be explained by India military pay hikes alone, given India's huge shopping list and its status as one of the biggest importers of military hardware in the world. The real aim is to intimidate India's neighbors, and assert India's hegemony. But it won't work as long as India has serious challenges of poverty, illiteracy, hunger, social inequity and multiple insurgencies at home by its most impoverished citizens.
Q3: Won't India just grow out of poverty, hunger, illiteracy through rapid economic expansion of its economy?
A3: Over a decade of rapid economic growth in India has done little to help its poor, hungry and illiterate population.
India has miserably failed to use a period of high economic growth to lift tens of millions of people out of poverty, falling far short of China’s record in protecting its population from the ravages of chronic hunger, United Nations officials said recently. In 2008, British Development Minister Alexander contrasted the rapid growth in China with India's economic success - highlighting government figures that showed the number of poor people had dropped in the one-party communist state by 70% since 1990 but had risen in the world's biggest democracy by 5%.
In the context of unprecedented economic growth (9-10 percent annually) and lack of national food security, over 60 percent of Indian children are wasted, stunted, underweight or a combination of the above. As a result, India ranks number 62 along with Bangladesh at 67 in the PHI (Poverty Hunger Index)ranking out of a total of 81 countries. Both nations are included among the low performing countries in progress towards MDG1 (Millennium Development Goals) with countries such as Nepal (number 58), Ethiopia (number 60), or Zimbabwe (number 74).
Ranked at 45 on PHI index, Pakistan is well ahead of India at number 62, and it is included in the medium performing countries. PHI is a new composite indicator – the Poverty and Hunger Index (PHI) – developed to measure countries’ performance towards achieving MDG1 on halving poverty and hunger by 2015. The PHI combines all five official MDG1 indicators, including a) the proportion of population living on less than US$ 1/day, b) poverty gap ratio, c) share of the poorest quintile in national income or consumption, d) prevalence of underweight in children under five years of age, and d) the proportion of population undernourished.
Q4: Why can't India do both: Increase defense spending and reduce poverty, illiteracy, hunger and disease?
A4: Defense spending should not be a sacred cow. Huge increases shouldn't get approved with little or no debate, and there should be much greater oversight of how it's spent.
It needs to be discussed and debated rationally in the parliament and the media.
What I find is that there is more debate and discussion in Pakistan on defense spending than there is in India, in spite of the fact Pakistan is fighting a war against determined insurgents in the North West.
In spite of its many other urgent issues like access to food, education and health care, it's a shame that a huge 34% boost in defense budget got approved in India without much serious discussion. A similar dramatic increase in Pakistan would have elicited howls of protest and loud demands to curtail it.
Q5: Why should there be any discussion or debate in India on defense budgets when there is consensus among all political parties that military spending should increase?
A5: That may be a good explanation of lack of debate, but the size of the increase at 34% year over year should be too big to slide through parliament without much scrutiny. And it's strange that there is no such consensus on similar spending increases on food, health care, education and poverty alleviation where India lags behind many of its neighbors.
In 2008, Indian Planning Commission member Syeda Hameed acknowledged that India is worse than Bangladesh and Pakistan when it comes to nourishment and is showing little improvement.
Speaking at a conference on "Malnutrition an emergency: what it costs the nation", she said even Prime Minister Manmohan Singh during interactions with the Planning Commission has described malnourishment as the "blackest mark".
"I should not compare. But countries like Bangladesh, Pakistan and Sri Lanka are better," she said. The conference was organized last year by the Confederation of Indian Industry and the Ministry of Development of Northeastern Region.
According to India's Family Health Survey, almost 46 percent of children under the age of three are undernourished - an improvement of just one percent in the last seven years. This is only a shade better than Sub-Saharan Africa where about 35 percent of children are malnourished.
Unlike Indian military which got 34% increase this year, there is no one talking about a similar spending increase for human development in a nation that is slipping to lower ranks in human development. In fact, the latest Human Development Report for 2009 shows that all major South Asian nations have slipped further down relative to other regions of the world. Pakistan's HDI ranking dropped 3 places from 138 last year to 141 this year, and India slipped six places from 128 in 2008 to 134 this year.
The total per-capita expenditure on health (central as well as state expenditure) is about a third of the per-capita expenditure on defense in India. This low level of funding is the prime reason for poor health parameters which in turn keeps a large proportion of the population in perpetual debt and poverty. The UN millennium development goals pertaining to mortality rates and poverty are not likely to be achieved mainly on account of poor spending and delivery in the health sector. The allocation for federal spending on health in the current year is Rs 22,641 crores or merely 0.4% of GDP.
Q6: Why Is the Indian defense spending any of this blogger's business?
A6: India's military spending directly affects the entire south Asian region. It increases the threat perception in the neighborhood, particularly when the Indian military brass engages in threatening rhetoric in the midst of its huge arms buildup. It distorts the spending priorities of Pakistan, a smaller neighbor which was invaded and divided by India in 1971.
Recently, Lt-General A S Lamba of Indian Army has been quoted by the India media as boating about a "massive thrust into Rawalpindi to quiet Pakistanis within 48 hours of the start of assault." Indian Army chief General Deepak Kapoor has said India is ready for a “the successful firming-up of the cold start strategy (to be able to go to war promptly) in the multiple fronts against multiple different militias at the same time.” General Kapoor has talked about taking on China and Pakistan at the same time.
Haq's Musings: FAQs on India's Massive 34% Defense Budget Hike
Haq's Musings: India's Arms Buildup: Guns Versus Bread
