Defence Sector Reforms Are Essential to Realize India’s Superpower Aspirations

India’s defence sector got 5.94 trillion rupees ($72.6 billion) for 2023-24, in the recently presented Union Budget. Out of the total defence budget of Rs 5.94 trillion, only Rs 1.62 trillion (27% of total defence budget) has been set aside for capital expenditure that includes purchasing of new weapon systems, aircraft, warships and other military hardware, stated the Union Budget report.

According to the 2023-24 union budget documents, an allocation of Rs 2.70 trillion has been made for defence revenue expenditure that includes expenses on payment of salaries to military personnel and the maintenance of defence establishments. A separate amount of Rs 1.38 trillion has been allocated for defence pensions. The total revenue expenditure including the pension outlay has been estimated at about Rs 4.22 trillion.

The allocation for defence personnel pensions are almost equal to the defence capital expenditure. After a populist and expensive tinkering with the pension scheme early in its tenure, the Government of India has found that it spends most of its defence budget on personnel costs, leaving very little for capital expenditure or for hardware. Almost two-thirds of 2023-24 defence budget has gone towards the salaries and pensions of military personnel.

In order to reign-in the defence personnel costs, the Government of India has announced that it was shifting to a new tour-of-duty type recruitment system in which new recruits will be taken on for a four years contract and then discharged with a bonus of Rs 10.04 lakh (along with accrued interest), while being paid a salary of Rs 30,000/- per month with a fixed yearly increment.

India’s military, particularly its army, is manpower-heavy and not so young in age. The average age of an Indian soldier is about 32 or 33 years, making the country’s army one of the oldest in the world. Military strategists have been calling for a leaner and younger army. The tour-of-duty recruitment scheme is intended for reducing the the military spends on salaries as much as for creating an army that is younger and more agile technologically.

“Agnipath Scheme” is a tour of duty style recruitment scheme introduced by the Government of India on June 14, 2022 (and implemented in September 2022), for recruitment of soldiers below the rank of commissioned officers into the three services of the armed forces. All recruits will be hired only for a four year period. Personnel recruited under this system are to be called Agniveers. The earlier typical annual enlistment of 60,000 young men was for a 20-year military service. The new scheme has set off a firestorm of protests in many parts of the country. For many young men in the most economically disadvantaged parts of India, the army recruitment is their only hope of a career.

As an aspiring superpower, the Indian military should be an organization possessing new generation hardware — designed to project power, ensure domestic security and technologically savvy to respond to emerging external threats.

Higher capital expenditure allocation to the defence sector is crucial for India’s aim to become self-reliant in defence manufacturing, for state-of-the-art acquisitions, for creating infrastructure and for adopting to modern technology.

About 90% of the Indian Army’s equipment comes from Russia. Moscow has created a trust-based relation with India in the military domain. Russia has been more open than the West to the transfer of technologies in the framework of joint ventures. However, some Western military equipment has also often been acquired to account for capability gaps. Of late, India is also getting closer to the Western countries in the framework of the Indo-Pacific and Quad.

Indian Army’s chief General Manoj Pande has recently said: “In any force at any point of time, you will have ‘vintage’ equipment, another set will be ‘current’ and the third will be ‘state-of-art.’ In our current profile, as it stands today, I would say it is about 45 per cent ‘vintage’, 41 per cent ‘current’ and 12-15 per cent ‘state-of-the-art’.”

The army chief added “But by 2030, because of the modernization plan, we will reach a figure of close to 35 per cent ‘current’ and 44 per cent ‘state-of-the-art.’ That is what introduction of technology including the introduction of niche technology will achieve.”

India needs to step-up its ‘state-of-the-art’ equipment to about 50%  as soon as possible, create a leaner and younger force, and increase capital expenditure allocation to 50% of its defence budget, in order to project a military might communserate to its superpower aspirations.

[Photo by Defence Research and Development Organisation, via Wikimedia Commons]

The views and opinions expressed in this article are those of the author.

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