When the Parliamentary Standing Committee on Defence meets this week to discuss the Budget allocations made by Finance Minister Nirmala Sitharaman, we hope to get some clarity on the provisions made towards India’s national security. That’s because on defence, the Union Budget for FY2021-22 hides more than it reveals. Not only was ‘defence’ conspicuous by its absence in the finance minister’s Budget speech for the second consecutive year, the component-wise budgetary allocation also raises more questions than answers.

As the Committee examines the Demand for Grants of the defence ministry, we believe there are at least four important questions that the panel should ask.

Also read: Economic ideology is the new binary in Indian politics as Modi swerves Right & Rahul Left

Rising threat, declining expenditure 

What explains the reduction in total defence expenditure even though the threat posed by China hasn’t gone away?

Despite the rhetoric, defence expenditure for FY2021-22 is estimated to be 1.35 per cent lower than the Revised Estimates for FY2020-21 in absolute terms. The Revised Estimates themselves increased by a marginal 2.3 per cent (~Rs 13,000 crore) over what was proposed in the last Budget. Total Ministry of Defence (MoD) expenditure as a proportion of GDP continues to languish at the 2.15 per cent mark. In a year that saw the economy contracting because of the pandemic and China adopting a confrontational posture on India’s borders, these numbers do not inspire much confidence. The Committee must ask the defence ministry if the Union executive is exploring all possible options to prioritise defence financing.

Also read: How China is fast catching up with the West in the race for air-to-air missile superiority

Money to modernise 

Does the government have the financial headroom for modernisation of defence going ahead?

The Committee in 2019 had observed that the Budget allocation for modernisation, covering both committed liabilities and new schemes, did not meet even the committed liabilities. This has been the case since 2016-17, forcing the Committee to observe that inadequate allocation for committed liabilities could lead to India defaulting on contractual obligations. Long before the pandemic, even the financing of existing schemes was not guaranteed, leave alone new schemes for modernising the armed forces.

The government did course correct last year by increasing the capital outlay on defence (of which modernisation is also a part) by nearly Rs 20,000 crore during the pandemic, the Budget document revealed. Many post-Budget news reports subsequently claimed that this increase reflected emergency purchases of precision-guided munitions and drones to counter China. However, an increase of Rs 20,000 crore cannot be explained by these purchases alone. Major defence equipment isn’t available off the shelf and their payments are made over many years. So, where did the money go?

It’s more likely that the higher capital outlay was on account of payments for equipment purchased in the past. The budgetary allocations attest this claim to some extent. Of the Rs 20,000 crore increase, the Navy under the line items ‘naval fleet’ and ‘aircraft and aero engines’ accounts for nearly Rs 9,000 crore and the Air Force under ‘other equipment-air force’ accounts for another Rs 10,000 crore. Since the Budget documents don’t make any distinction between new schemes and committed liabilities, the Committee must ask the MoD to come clean on the modernisation plan.

Also read: Why Modi govt’s defence budget isn’t rising & the gap between realities, expectations

Drop in defence pension expenditure 

What explains the sudden drop in defence pension expenditure by nearly 13 per cent?

The Revised Estimates for FY2020-21 are lower than the Budget Estimates for the same year by nearly Rs 18,000 crore. This is surprising for two reasons. One, personnel expenses such as pensions are quite predictable. Two, after the introduction of One Rank One Pension, or OROP, pension outgo has been rising with a cumulative annual growth rate of over 17 per cent.

In such a situation, an absolute decline in pension expenditure is not possible without a sudden decrease in the number of retirees or a reduction in each retiree’s pension.

This sudden decline in pension outgo has sparked wild speculations. Some reports claim this reduction is due to a government proposal to increase the retirement age of officers, thereby decreasing the number of retirees. However, this move alone would still not explain a fall of nearly 13 per cent because the bulk of the pension expenditure is for personnel below officer ranks (PBORs). Moreover, this explanation still doesn’t account for a reduction in pension expenditure in the Revised Estimates of FY 2020-21.

Another claim being made is that a freeze in dearness allowance, in force since the pandemic, has caused a reduction in the pension outgo per personnel. This explanation is unsatisfactory because a decrease would have affected pay but not the pension amounts already fixed for the last year.

A third speculation is that previous years’ payments included arrears that have been compensated for already and hence the reduction in pension outgo. If that were the case, why did the Budget Estimates for FY 2020-21 include these arrears? This information is quite predictable and would have been available even before the FY 2020-21 Budget was made.

A final explanation for lower pension outgo is that the government is trying to book pension commitments over multiple years in light of the fiscal situation.

With speculations flying around, it is now up to the Committee to get the MoD to set the record straight on pensions. While reducing pension expenditure over the long term must remain an important goal, going back on existing statutory pension commitments would be counterproductive.

Also read: Nirmala Sitharaman has done her job. Now, all eyes are on RBI Governor Shaktikanta Das

Revenue concerns

What are the MoD’s plans to raise revenues on its own?

The government has given an in-principle nod to the 15th Finance Commission’s recommendation for creating a non-lapsable defence fund to finance modernisation. Three of the four sources for populating this corpus are under the domain of the MoD — disinvestment of Defence Public Sector Enterprises (DPSEs), monetisation of defence land, and transfer of defence land to state governments and public projects. The Committee must drive urgency in the MoD for raising revenues through these routes. It should ask the MoD to immediately identify DPSEs that need to be disinvested.

The Parliamentary Standing Committee on Defence can bring some much needed clarity to critical issues concerning India’s national security. What the Committee does will indicate whether legislative oversight over a powerful executive can work in the Indian setup.

Lt Gen (Dr) Prakash Menon is Director, Strategic Studies Programme, Takshashila Institution, Bangalore. Pranay Kotasthane is Research Fellow at the Takshashila Institution. Views are personal.

Ajay Banerjee
Tribune News Service
New Delhi, February 16

India and China have started the process to physically verify each other’s military positions on the Pangong Tso banks following the disengagement process that started on February 10 along the Line of Actual Control (LAC) in eastern Ladakh.

• Also read: LAC withdrawal plan gives China the edge

“The first phase of disengagement will be a two-week process and is expected to be over between February 22 and 24,” said sources, hinting that commanders of both sides could meet any time after February 24.

The verification process is being done using permissible means like physical visits as well as drones and cameras, sources said, adding that the de-induction of troops, tanks, artillery guns, etc, was going as per schedule. The teams for verification on either side are submitting detailed reports to their respective commands.

Dismantling bunkers, helipads part of Disengagement

• Pullback verification teams submitting reports to their respective commanders
• De-induction of troops, tanks, artillery guns is going as per schedule, sources say
• Pullback includes dismantling all infra like bunkers, helipads created after April last year

They will report back once the tanks, troops, guns and all vehicles are back at their home bases. The pullback includes dismantling of all infrastructure, including bunkers, helipads, housing units and tents, created after April last year. “The land has to be brought back to the April 2020 status,” officials said.

Once the process is done, commanders of the rank of Lt General are slated to meet within 48 hours and chalk out the next phases.

The first phase of the disengagement for both sides entails withdrawing from positions on the north and south bank of the Pangong Tso, a 135-km glacial lake. The next phases will see talks for similar pullback at Depsang, Gogra and Hot Springs, all located along the 823-km LAC in eastern Ladakh. Since April 2020, there has been a massive build-up on both sides.

Defence Minister Rajnath Singh told the Rajya Sabha on February 11 about the future course on the pullback. “There are still some outstanding issues with regard to deployment and patrolling at some other points along the LAC in eastern Ladakh. These will be the focus of further discussions with the Chinese side,” he said.

Along the LAC in eastern Ladakh, there are locations where troops of both sides are eyeball to eyeball.

Besides the Pangong Tso, the next phases will cover resumption of patrolling limits in areas along the LAC which are claimed by both sides. The 900-sqkm Depsang plains located north of the Shyok river will also be taken up. Located at an altitude of 16,000 feet, the Indian Army holds a large portion of the Depsang plains, while the People’s Liberation Army (PLA) of China holds the eastern edge of the plains.

ribune News Service

Amritsar, February 16

The Pakistan government has allowed 505 pilgrims, visiting Nankana Sahib to commemorate the massacre centenary, to visit other prominent Sikh shrines in the country too.

The schedule

Feb 18 Janam Asthan, Nankana Sahib

Feb 19 Gurdwara Sacha Sauda, Farooqabad

Feb 21 Main event at Nankana Sahib

Feb 22 Gurdwara Panja Sahib, Hasan Abdal

Feb 23 Gurdwara Dera Sahib, Lahore

Feb 24 Kartarpur Sahib & Rori Sahib, Gujranwala

Feb 25 Back through Attari-Wagah border

Sponsored by the SGPC, the jatha, led by Akal Takht officiating Jathedar Giani Harpreet Singh, will cross the Attari-Wagah border on February 18 and head to Janam Asthan, Nankana Sahib.

Earlier, the jatha was allowed to celebrate the 551st birth anniversary of Guru Nanak Dev, but their movement was restricted to Sri Nankana Sahib only in the wake of Covid threat.

The Covid screening report has been made mandatory. The SGPC had conducted a two-day special Covid testing camp that concluded on its premises here today. Various “gurmat” programmes have been scheduled in Pakistan.

As per the eight-day programme, the jatha will visit Gurdwara Sacha Sauda, Farooqabad, on February 19. The main event will be held at Nankana Sahib on February 21. The following day, they will visit Gurdwara Sri Panja Sahib in Hasan Abdal; Gurdwara Dera Sahib, Lahore, on February 23, where dinner will be hosted at the Governor’s House. On February 24, they will visit Gurdwara Sri Kartarpur Sahib and Rori Sahib, Gujranwala, and come back to Lahore. On February 25, the jatha will return through Attari-Wagah JCP.

The Shiromani Gurdwara Parbandhak Committee (SGPC), too, will commemorate the occasion under the leadership of its president Bibi Jagir Kaur. The event will be held at Godharpur village in Gurdaspur district, which is associated with the kin of Shaheed Bhai Lachhman Singh Dharowali, martyr of Nankana Sahib a century ago.