Originally Published 2015-09-11 10:17:35 Published on Sep 11, 2015
Recurring defence costs: Looking beyond the numbers 

"Many emotional arguments have been made about the implementation of the one-rank-one-pension scheme. The military veteran community has held a moral high ground and is not ready to compromise on its demand. The refusal by the ex-Servicemen to accept the OROP over the demand for 'pension equalisation' at least every two years and the Government's decision to take 2013 as the base year to calculate pensions, reflects a complete lack of appreciation to tackle the financial implications of the ex-Servicemen's demands.

The Government has passed the OROP only to fulfil their election promise and to avert further affecting civil-military relations. However, the financial implications of passing the OROP will not only affect the Government of the day, but also the future Governments as pension Bills keep ballooning. How can the Government curb the ballooning of its defence spending due to recurring manpower costs? Does the solution lie in reducing the size of the military?

The problem lies in our military thinking and the solution provided by our military leadership in meeting our defence goals. Whatever the threat perception, the solution has almost always been to increase manpower. After the 1999 Kargil conflict, a policy of cutting 50,000 troops to save on manpower costs was reversed.

The approval to create the Mountain Strike Corps with 90,274 soldiers, a few years ago, is another example of numeric solutions. Lack of infrastructure on the border with China which enables lateral or forward movement of the troops along the borders, means our forces need to be pre-positioned to meet any threat perception along the borders. This results in a manpower intensive effort which has debilitating cost implications on our defence Budget. Of the total increase of Rs17,727 crore in the defence Budget of 2015-2016, a sum of Rs8,855 crore (50 per cent) was allocated to cater the increase in pay and allowances of the three Armed services.

The Indian Air Force has a projected need of 45 fighter aircraft squadrons to be able to fight a two-front war. Threat perception of a two-front war stems from a directive from the Defence Minister. The question is: How will the acquisition of these 45 aircraft squadrons be affordable, given the paucity of funds? This was not taken into account when these plans were drawn.

The cancellation of the original tender for 126 Rafale aircraft from France is a recent example of the unaffordability of modern weapons platforms in the numbers the IAF envisages to acquire to meets the operational directive of a two-front war.

Defence modernisation remains stalled due to the lack of funds to make capital acquisition. Such is the state of affairs that deals worth two or three billion dollars cannot be inked as the Ministry of Defence cannot cough up 10 per cent to 20 per cent of the total value of the deals as signing amounts.

The Defence Acquisition Council clears deals worth thousands of crores without virtually signing any. The implementation of the OROP, according to the demand of the veteran community and the increase in the number of retired personnel in the coming years, will further eat into the limited capital Budget that the Government approves for the Armed Forces.

Defence pensions have risen from Rs50,000 crore in 2014-2015 to Rs54,500 crore in the 2015-2016 outlay. Even an addition of a conservative OROP implementation cost of Rs8,000 to Rs10,000 crore increases the Government's financial liability significantly annually.

The trend world-over is to reduce the size of standing Armies. The British offer an interesting model. They are in the process of reducing the size of their standing Army and increasing the size of their Army reserves to save on manpower costs, while maintaining access to a pool of trained manpower. By 2020, the ratio will be at 82,000 standing troops versus 30,000 reserves.

Similarly, the Royal Air Force and the Royal Navy have cut numbers in personnel and platforms in their quest for affordability. The US Army has, since 2012 cut 80,000 troops and is in the process of reducing by another 40,000 troops. Granted that the British or the US do not face any existential threat or have boundary disputes like India, but it's still an idea worth contemplating.

As far as India is concerned, does our military brass still envisage a full-fledged conventional military conflict with Pakistan or China, given the existence of the threat of nuclear weapons use? If not, then why do we need a standing Army of close to 1.2 million men or 45 squadrons for the Indian Air Force to face the challenges of a two-front war?

China too is progressively reducing the size of its People's Liberation Army since the 1990s. Currently, the PLA stands at 2.3 million men and women under arms — down from more than three million. A recent announcement will see the number reduced by another 3,00,000 personnel.

Instead, the focus has shifted to mechanisation and informationalisation of forces as well the recruitment of more qualified personnel capable of operating technology-intensive equipment.

The Indian military on the other hand has so far shown little sign of shifting from number-based calculations to effect-based warfare dependent on technology.

It is time for the military to start deliberating over how to develop and maintain a spectrum of capabilities in accordance with realistic threat perceptions. India's military brass must take cognisance of the Government's financial constraints. A reduction in the size of the Armed Forces to curtail debilitating manpower costs is a first step in freeing money for capital acquisitions and modernisation.

Courtesy: The Pioneer"

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Pushan Das

Pushan Das

Pushan was Head of Forums at ORF. He was also the coordinator of Raisina Dialogue. His research interests are Indian foreign and security policies.

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