Why Does India Spend So Much on the Military?
BY ARADHANA ABRAHAM / 20 NOVEMBER, 2021
Pinpointing the symptoms behind India’s military expenditure while trying to understand if it can be justified
he father of modern economics, Adam Smith, stated the significance of the government in its role of defending the nation from invasion. While considering defence management, he observed that changes in technology would increase the cost of warfare. This increasing cost has been seen over the years with countries around the world spending colossal amounts of money on their militaries due to perceived threats. What this cost looks like differs from county to country based on their needs. Navigating these costs is a complex but necessary task to better how best to meet the varied needs of the nation.
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India was the third-largest military spender in the world with 72.9 billion USD in the year 2020-21
According to the Stockholm International Peace Research Institute, an independent research body, India was the third-largest military spender in the world with 72.9 billion USD in the year 2020-21. This was 2.1% higher than 2019 and accounted for 3.7% of the global spending on defence. The year the pandemic struck the world, 2020, saw a drop in the global GDP by 4.4% but an increase in military expenditure by 2.6%. Military spending accounted for 2.9% of India’s GDP. Not just India, but all of Asia and Oceania have seen a general upward trend in military expenditure since 1989.
While the Army eats up a large chunk of resources made available, of the total, Capital Expenditure accounts for only 18% of the funds
Pictured: unknown via The Business Standard
The government apportioned 15.5%, which is approximately INR 4,71,378 crore, of the total budget to the Ministry of Defence. The Indian Armed Forces include three main services, the Army, the Air Force and the Navy. In terms of resources, each service was allocated 56%, 23% and 15% respectively. While the Army eats up a large chunk of resources made available, of the total, Capital Expenditure accounts for only 18% of the funds and 82% is spent on Revenue Expenditure. Capital expenditure is meant to cover the cost required for upgradation of weapons systems and modernisation of defence. Revenue expenditure is what is used for running costs such as payment of salaries and pensions. With the Indian Army’s ground forces having a strength of almost 1.5 million, the second largest in the world, are such numbers a surprise? In addition, India is also the world’s second-largest importer of arms and ammunitions accounting for 9.5% of global imports but still falls short of required weaponry in all three armed services.
Most developing and underdeveloped countries tend to spend more on manpower than on defence procurement, as the logistics of building and maintaining a technologically advanced defence system can be quite an expensive proposition for such countries. Thus, while many are of the belief that India should focus more on the indigenisation of weapons production, the reality of our situation is that we lack the funds to do so. This skewed spending has severely hampered the modernisation of the Armed Forces as a whole and has consistently fallen short of providing for the necessary funds required to make improvements.
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Pictured: 'Made in Indian Armed Forces' unknown via The Economic Times
While evaluating this expenditure the general trend has been to make comparisons with China, as it is deemed a powerful and often threatening presence in our corner of the world, but the stark differences in the aspirations of our countries are worth considering. China has been trying to compete on a global level to reach a super-powered status like the US. This means that a lot of their expenditure is directed towards meeting that objective. They managed to cut their ground forces by 50% by January of 2019 while having consistently improved on the abilities of their naval and air forces. India on the other hand, is a growing country whose main aim with defence is to protect the country from neighbouring threats. The strength and experience of the armed forces in different terrains, weather conditions and varying tactics have helped counter attacks from both Pakistan and China in the past. While they have served us well, they might prove to be insufficient in the future.
Within this context, the aspect of modernisation comes into play because, unlike China, India’s Air Force and Navy miss the mark. Having stayed stuck in the strategies and styles of the past, the massive ground forces of the Army serve as a major burden. The country has failed to recognise the direction that warfare in the world around is headed towards and has stayed complacent. The recent clashes between India and China in Ladakh and drone warfare with Pakistan have opened up the eyes of the government towards the weaknesses in our defence systems. Improvement efforts have been made in the recent past and as part of the 2021-22 Budget, INR 1,35,060 crore i.e. approximately 28% of the military's allocated budget has been set aside for Capital Expenditure.
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Pictured: unknown via Pinterest
The country has failed to recognise the direction that warfare in the world around is headed towards and has stayed complacent.
Pictured: 'Lost Finances' unknown via Macrovector
The government has a multitude of obligations to fulfil. Spending on military resources means spending that much less on other public services such as healthcare, education and infrastructure. Last year, the government expenditure in two of these sectors fell short of the global averages and the pandemic made this clearer than ever. With the complete collapse of the health sector during the second wave of the pandemic and the lack of schooling options for students who rely on the public education system over the past two years, this deficiency cannot be ignored. The country would be served greatly by improving the allocation of funds in these fundamental areas. However, any changes made must remain conscious of India’s specific circumstances. The need is to optimally use resources that have already been allocated as opposed to increased funding. More funds with no readjustment would only exacerbate the shortfalls. Thus, it is high time that the government took heed of the immense responsibility that rests on its shoulders, not only of ensuring that the country is prepared to defend itself, but also of safeguarding the welfare of its citizens.
Keywords
Defence, Indian Armed Forces, Government Expenditure
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References
Bhatnagar, A. (2021, January 30). India's Defence Spending In 7 CHARTS. The Times of India. https://timesofindia.indiatimes.com/india/indias-defence-spending-in-7-charts/articleshow/80600625.cms.
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Cowshish, A. (2021, January 9). India's 2021-22 Defence Budget Needs Honest Financial Reckoning, Not Empty Rhetoric. The Wire. https://thewire.in/security/india-defence-budget-military-spending-honest-recokoning.
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Ireland, S. (2021, June 12). These Are The World's Biggest Importers of Major Arms. CEOWORLD magazine. https://ceoworld.biz/2021/06/12/these-are-the-worlds-biggest-importers-of-major-arms/.
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Kaushik, K. (2021, April 27). India Third Highest Military Spender In 2020, States Data Published By Stockholm International Peace Research Institute. The Indian Express. https://indianexpress.com/article/india/india-third-highest-military-spender-in-2020-7290118/.
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PTI, (2019, January 22). China Reduces Army By Half; Increases Size Of Navy, Air Force In Big Way. The Economic Times. https://economictimes.indiatimes.com/news/defence/china-cuts-down-troops-in-army-by-more-than-50/articleshow/67640085.cms?from=mdr.
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Shankar, L. G. P. R. (2021, March 16). Indian And CHINESE Defence Budgets – Comparative Hype and Reality. PGurus. https://www.pgurus.com/indian-and-chinese-defence-budgets-comparative-hype-and-reality/.
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