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New Delhi: Defence Minister Rajnath Singh emphasized on Friday that despite the ongoing tensions with China in Eastern Ladakh and the situation along the Line of Control (LoC), the government is committed to ensuring that the operational capability of the armed forces remains unaffected. He also highlighted the need for effective management and utilization of available resources, given the financial constraints faced by the military.
The minister's statement came at a time when defence forces are feeling the pressure of a constrained budget, which has led to delays in several key modernization projects.
Speaking at an event organized by the Defence Research and Development Organization (DRDO), Singh stressed the importance of conducting a realistic assessment of the challenges at hand. He said, "A practical and grounded evaluation of our challenges is essential, as only then can we identify the necessary actions to address them."
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Regarding the national security situation, Singh acknowledged the growing tensions along both the western border with Pakistan and the northern border with China, noting that these situations have placed significant demands on India’s defence resources.
"In the face of these challenges, I assure you, on behalf of the government, that resource limitations will not hinder our success in securing our borders. This commitment has been reinforced by the Prime Minister, and I confidently affirm this," Singh stated.
However, the minister also acknowledged the economic repercussions of the COVID-19 pandemic, which have affected the country’s finances. "We must be mindful of the economic downturn brought about by the pandemic. The key, therefore, is to make the most efficient use of the available defense budget. This is something we must focus on, and I trust our scientists understand how to maximize resources," he added.
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Sources within the defence sector pointed out that the defence budget shortage is a significant concern, with several modernization efforts delayed or reduced due to financial limitations. The ongoing standoff with China, which has lasted for eight months, has also strained the Army's budget, with nearly 50,000 troops and equipment deployed along the border.
To address the financial strain, the Modi government has lifted certain expenditure restrictions in the third quarter of the fiscal year, allowing defence procurement to proceed without prior approval from the finance ministry.
"While there are several factors contributing to delays in some projects, the root cause remains the budget," said a source familiar with the situation.
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Existing Budget Challenges
Despite a slight increase of 1.82% in India’s defence budget for this fiscal year, raising it to Rs 3.37 lakh crore (excluding pension expenditure), the funds remain insufficient to meet the growing demands of the military. The limited budget has forced the armed forces to scale back procurement and modernization plans.
The Navy, in particular, has had to reassess its strategies due to the insufficient budget, which has been repeatedly cited as inadequate for future acquisitions and liabilities.
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Several major defence projects, including the purchase of new fighter aircraft, a Tejas Mk 1A, nuclear and conventional submarines for the Navy, and additional helicopters and tanks for the Army, have been delayed for years, even before the pandemic disrupted schedules.
Earlier this month, Navy Chief Admiral Karambir Singh revealed that the Navy had approached the finance ministry with alternative funding models, including a proposal similar to the Indian Railway Finance Corporation (IRFC) model, to secure necessary funds for shipbuilding and other critical projects.
