The budget is unlikely to give more money for equipment, but the Armed Forces still want expensive imports over domestic products

• It is unlikely that the budget allocation to the Armed Forces will increase dramatically this year, according to Sameer Patil, an expert in international security.
• The lion's share of the budget will go towards the Army, leaving the Navy and the Air Force strapped for cash.
• Patil told Business Insider that the Navy and the Air Force are forced to rely on imports since domestic products are usually inferior in quality or do not meet their requirements even though they don't have enough resources to pay for projects that are already underway.

Budget allocation for India's Armed Forces always falls short of requirements. Even though the budget increases every year, most of it goes toward revenue expenditure to pay salaries and pensions.

Even within the entire allocation, the lion's share goes towards the Army rather than the Navy or the Air Force, which are more technology-intensive.

"The government will try and maintain the incremental growth which they do every year but it will not be sufficient to meet the requirements of the armed forces — particularly for the Navy and the Airforce, where they're finding it difficult as it is even to make payments for the equipment that they have already started purchasing," said Sameer Patil, a fellow in international security studies at Gateway House — a think-tank based in Mumbai told Business Insider.


The shrinking allocation of resources means that a lot of the proposals that have already been cleared by the defence acquisition council are now being strapped. For instance, the Indian Navy was supposed to get four landing platform dock-type ship built in India. So far, it only has one -- the INS Jalashva, which it bought from the US.

At the end of the day, they are left with no option but to import weapons and equipment. The domestic defence industry is either still developing products which are already available off-the-shelf abroad or producing products of inferior quality.

The question of research and development
It's not that domestic firms don't wish to invest in research and development (R&D) but they lack incentives. Last year, the government allocated some funds to the Technology Development Fund. However, the money is insufficient to cover even a single project, according to Patil.

In addition to scarce resources, the Defence Research and Development Organisation (DRDO) discourages private participation. "If the DRDO finds out that the private sector is engaging in any R&D work, they will come and say that we will do the R&D — because we have the experience and the necessary facilities, and we'll give you the final product," explained Patil.

The government can't say no
Once the DRDO steps in, the government isn't in a position to say no. For example, the Naval Light Combat Aircraft developed by the DRDO and Hindustan Aeronautics Limited (HAL) were rejected by the Navy four years ago.

The Navy explained that they did not need the new choppers because they had already purchased Apache and Chinook from the US. Nonetheless, HAL is still pursuing the project.


"Which is why the armed forces are saying that they would prefer imports rather than rely on the DRDO. Because sometimes it's of inferior quality and sometimes it doesn't meet the requirements of the armed forces," said Patil.

He feels that the private sector is more efficient and currently in the process of absorbing the requisite skills through joint ventures with American aerospace companies — like the Tatas with Lockheed Martin. However, they are not immediately expected to do so.

Although defence indigenisation holds a lot of potential, it will take at least a decade or two to show results.


See also:
Here's how the budget allocation for Armed Forces in India stacks up on the global scale

Budget 2020: Five charts that explain what you can expect from India's defence expenditure this year

India's ready to spend on defence — just not on modernisation