India won't cut military spending, cites growing terror threats

14 Nov, 2006

India, the largest arms purchaser among emerging nations, said Monday it will not prune its military spending, because of the growing threat from terrorism and regional tensions.
India annually spends 14 billion dollars, or 2.34 percent of its Gross Domestic Product (GDP), on its military. Since 2004 it has either spent or committed billions of dollars in modernisation projects planned until 2010.
"It is a harsh reality that defence expenditure involves huge outlays on acquisitions," Foreign Ministry Pranab Mukherjee told visiting defence officials from 40 countries including Britain, China, Germany and the US.
"There is no denying the fact that the challenge of modern warfare with the likely nuclear, biological and chemical dimensions cannot be met with outdated technologies," he said.
"These assume greater significance because of unfathomable dangers arising from proliferation of nuclear technologies over the years and the capability acquired by international terrorist organisations." "And therefore there is no escape from modernisation of the defence forces," said Mukherjee, who until last month held the defence portfolio.
India has in the past two years spent 7.0 billion dollars on acquisitions including 1.43 billion dollars on 26 British trainer jets, 1.2 billion dollars on six French submarines and 1.5 dollars on a Russian aircraft carrier.
Its immediate shopping list includes 126 fighter jets worth 6.5 billion dollars, artillery for 1.5 billion dollars as well as plans to construct an air defence ship worth 2.2 billion dollars, according to available estimates.
India accuses Pakistan of not only being a nuclear proliferator but also of backing Islamic guerrillas fighting Indian rule in Kashmir which has claimed 44,000 lives since 1989. India will also hold talks with Chinese President Hu Jintao who arrives November 20. Finance Minister Palaniappan Chidambaram warned the Indian military that it must generate revenue to help India retain its eight percent economic growth.
"We now have to take hard decisions to restructure certain expenditures and we have to maximise available public resources by enlisting private resources wherever feasible," Chidambaram told the conference.
"Soft options for reducing expenditures or increasing revenues are getting exhausted," he said. "Also, the argument that the government must support loss-making or inefficient state undertakings because of their strategic importance is difficult to sustain in an increasingly globalised world with many more efficient alternatives," Chidambaram said. Most Indian military development projects have been delayed by eight to 10 years due to lack of expertise or resources.
However, junior defence minister Pallam Raju, who also attended the three-day conference, backed Mukherjee by saying India could not afford to lower its guard.
"India has been a big spender in this part of the globe in 2004 and 2005 and it is unlikely the scale of expenditure will see any abatement in the forseeable future given the unfolding security scenario and the related threat perception including terrorism in many forms and shapes," Raju said.

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