The defence scene and the budget: An appraisal

Source : The Indian Defence Review, 1995 by Lancer Publishers & Distributors.

Article Author : Lieutenant General J. F. R. Jacob, PVSM (Retd)

India today is faced with an extensive defence and security parameter, 14,103 kilometres of land borders, including 7,000 kilometres of border with countries with which major territorial disputes still persist (Pakistan and China), a coastline of 7,600 kilometres and 2.5 million square kilometres of Exclusive Economic Zone (EEZ) to protect. Besides this, there are over 500 islands plus offshore hydrocarbon installations. The land defence perimeter spans some of world's most difficult terrain, the Himalayas in the North, thick mountain jungles in the East and North-East and the Ran swamps of the West.

China continues to occupy 37,555 square kilometres of Indian territory and 5,180 square kilometres in Ladakh have illegally been transferred by Pakistan to China from Pakistani occupation of so-called Azad Kashmir which is some 78,000 square kilometres of territory. Pakistan's sponsorship of terrorism and insurgency in Kashmir and the North-East is of increasing concern.

China is a nuclear power. The Chinese armed forces, the world's third largest, are being continuously modernized. An expanding infrastructure in Tibet created over the years, sizeable ground and air forces together with a capability of rapid reinforcement enable China to be able to launch major offensive operations. Extension of rail, road and other infrastructural projects such as pipelines and air facilities are proceeding at a fast pace. The airfields in Tibet are being improved to take heavy military transport and civilian aircraft. The runway at Gongkor airport has been extended to 4,000 metres. China has held many exercises to reinforce her Army in Tibet. In March 1989, the 149 Airborne Division was moved from its base in Sichuan to Lhasa in 36 hours. There have been other such exercises at regular intervals. Significant too is the move of the control line military headquarters from South-West China in the Lhasa area. China is reported to have over 500 nuclear bombs/warheads. China is continuing with underground nuclear tests at Lop Nor. Out of the 500-plus nuclear devices that China has, about 200 are free-fall bombs capable of being dropped by a variety of Chinese aircraft. The bulk of the remainder are designed to be fitted into the large numbers of land-based missiles. China is also developing a range of missiles, for its surface naval vessels and its submarines as well as neutron bomb and laser weaponry.

Pakistan has waged three wars against India. Pakistan is currently sponsoring insurgency in Kashmir. It is fuelling terrorism and insurgency in the North-East. It is in the process of modernizing its armed forces. China is assisting it in building defence, industrial infrastructure, machinery and weapon technology. Chinese technicians are currently engaged in retrofitting and upgrading obsolescent aircraft and tanks.

Pakistan has the geo-military advantage of operating on interior lines. This gives it the capability of mounting a major offensive against India in a matter of days. It also gives her the capability of switching forces from one sector to another with great rapidity. India due to its geographical position and its exterior lines requires much more time to concentrate forces and to switch from sector to sector.

China has actively assisted Pakistan in developing nuclear weapons and missiles. It is reported to have made available underground testing facilities at Lop Nor. Pakistan is said to have produced some 15 nuclear warheads and has enough weapon-grade uraniumtofabricatebetweenlOand20morewarheads. Pakistan, with Chinese assistance, has developed the HATF 2 and 3 short-range ballistic missiles. China has supplied Pakistan with M-11 missiles capable of being fitted with nuclear warheads and is assisting Pakistan in such a technology. Pakistan has linked its nuclear programmes to its claims on Kashmir. Pakistan's nuclear and missile development programmes should be viewed in this context.

Pakistan has a disproportionately large navy considering her coastline of some 700 kilometres. It is developing the port of Gwadar near the Iranian border into a naval base with supporting airfield complexes - naval and air force approaches to the Gulf through the Straits of Hormuz through which a large proportion of our oil supplies pass. Pakistan is expanding her surface, underwater and air arms. Her recent order of four sophisticated French submarines is indicative of her designs in the event of hostilities to target our commercial shipping.

Recent threats by the Pakistani Prime Minister Ms Benazir Bhutto regarding going to war with India to liberate Kashmir should not be dismissed lightly. The balance of conventional forces is such that Pakistan does not have the capacity to win a conventional war. The possibility of Pakistan using nuclear weapons to achieve her declared aims cannot be ruled out. Pakistan, by issuing conflicting statements about its nuclear weapons, is creating a fog of nuclear deterrence. The otherfactor in this geo-military equation is China. It is difficult to anticipate or legislate for Chinese intentions and actions. China still holds the territory it has seized in Ladakh enlarging its claims from that it originally mooted in 1962 by expanding claim lines. It still maintains that its border in the North-East is as per the survey of India map of 191 7, i.e., the Inner Line in Arunachal Pradesh.

Indian defence planners, both civil and military envision that any future conflict with Pakistan will be of short duration. Due to the present balance of forces any future conflict may be of longer duration. The pattern of a future war will also be different as industrial and infrastructural complexes are likely to be targeted.

China, despite recent protestations of friendship, looks on India as a rival in its path of political, economic and military hegemony in Asia. India must have the wherewithal to defend its border including Bhutan where we have a commitment to defend.

In 1974 we exploded a nuclear device a Pokharan. The decision to carry out this test was pragmatic. Unfortunately the follow-up has been ambiguous. Had we gone in for a weaponization programme we would today have had the nuclear status of China, though in terms of nuclear arsenal a fraction of its capability.

Nuclear deterrence had kept the peace in Europe during the Cold War. The capacity to deter depends not only on the warhead but also on the delivery means. India should embark on a programme of fabrication of nuclear bombs/warheads. This should not present any great problem as we have sizeable stocks of weapon-grade uranium and the engineering ability to manufacture these.

To create a credible deterrent India requires to give priority to its missile development programme. It should aim to create both a first- and second strike capability. The Prithvi now being deployed can be fitted with a nuclear warhead. However, its short range of 150 to 250 kilometres gives it a limited coverage of targets in Pakistan.

China has the ability to strike Indian targets from the Tibetan plateau. The Agni with its planned range of 2,500 kilometres is not capable of reaching the Chinese heartland. In order to create a credible deterrence against China it is imperative that work to increase the range of the Agni to 5,000 kilometres is undertaken at priority. The development of solid-state fuel missiles for use with our submarines and surface ships should be undertaken.

Threat scenarios

Indian force levels must be adequate to meet the following contingencies.

The Indian strategy should aim at force levels to counter these threats. The most likely threat scenario in the short term can be stated thus: Pakistan with subsidiary threat from China. In the long term the main threat is from China.

The major combat components of the armed forces of India and Pakistan are given in Table 1. In the case of China, Chinese capabilities of waging an offensive from the Tibetan plateau are relevant.

Though Chinese armed forces total more than 3 million China's capability to deploy troops on the' Tibetan Plateau is restricted by terrain infrastructural problems and logistics. An assessment of capabilities is as follows:

Ladakh 1 army plus 3-4 divisions
Sikkim 1 army plus 3-4 divisions
Arunachal Pradesh 3 armies 9 divisions
(A Chinese Army consists of a basic 3 divisions)

The total assessed capability is that of 17 Infantry Divisions. China's Navy has a blue-water capability. Presently her ability of operating in the Indian Ocean and Bay of Bengal is restricted to her submarine arm which has more than 100 submarines, a proportion of them having nuclear propulsion. She has got Burma to agree to a railway connection to an Indian Ocean base for the Chinese Navy. Such a base will have a decided effect on the potential naval threat in the Bay of Bengal.


Armoury divisions 3 2
Infantry divisions 22 19
Independent armoured brigades 5 9
Corps independent artillery brigades 3 9
Mountain divisions



Independent infantry brigades



Army aviation squadrons



Air defence brigades/groups



Para brigades



Principle surface combat vessels

(including 2 Indian Aircraft Carriers)






Patrol and coastal






Combat aircraft

    conisisting of :



Fighter ground attack squadrons



Fighter air defence



Recconenance squadrons



Naval air combat aircraft



Helicopter (armed)



Defence expenditure

India's defence expenditure has been sinking in real terms. Inflation, currently around 11 per cent, is expected to rise. India's defence expenditure as a proportion of GDP declined from 4.04 per cent in 1986-87 to 2.53 per cent as against Pakistan's 6.88 per cent and China's official figure of 6 per cent (actual reported to be significantly higher).

As a proportion of total government expenditure, Pakistan spends 26.52 per cent, China 23.8 percent and India14.94 percent. India's defence expenditure share of governmental expenditure has come down from 17.27 per cent in 1987-88 to 14.94 per cent in 1993-94 and 13 per cent in 1994-95.

Defence allocations in 1994-95 were Rs 230 billion. This has been increased to Rs 250 billion in 1995-96.

The breakdown percentage in 1995-96 was :

Army 53.96%, Navy 13.29%, Air Force 25.69%, Defence production 1.76%, R&D 5.28%

Lack of funds has resulted in mothballing tanks, ships and aircraft. This reduces immediate combat readiness. Pensions for defence personnel have been taken out of the defence budget and are met, from the consolidated fund of India.

Defence production

There are 39 ordnance factories. These meet the armed forces' requirements and to some extent the paramilitary forces'. The production by the eight public sector undertakings particularly Bharat Earth Movers and Bharat Electronics has gone up.

Indian ordnance factories are producing a vast range of products, battletanks, infantry combat vehicles, self-propelled guns, field guns, anti-aircraft guns, mortars, small arms and ammunition, rockets and projectiles, bombs, grenades, mines, depth charges and other items. They also supply the railways, coal industry, paramilitary and police. Production of the 5.56 rifle has begun. India also exports various defence items.

In 1987, procurements from ordnance factories wore shifted from the defence production head to defence allocation. This has had the impact of reducing the Army's allocations correspondingly.

Though R&D funding registered a growth in the last ten years from 2.05 per cent to 4.39 per cent in the last budget, the money allotted is inadequate. In 1987, the transferring of R&D to defence as a consequence had an effect on the total defence allocations. Funding for R&D despite the increase of 105.13 crore in 1995-96 is far less than what is required. Since R&D for defence also has a bearing on other allied research agencies it would be preferable that R&D is funded under a separate head and its funding suitably enhanced to meet defence research needs. The priorities are for the :

AIR FORCE - LCA, helicopter (ALH) and Agni

ARMY - main battle tank, missiles, radar and artillery

NAVY - weapons systems, missiles and sonar equipment

Not only has Pakistan's defence expenditure increased significantly, the Pakistani Military Capital Stocks have also increased, both qualitatively and quantitatively. During the last few years Pakistan has fabricated nuclear warheads (estimated at 15), and built up fissile stocks to fabricate a similar number. Pakistan has added to her arsenal during the last five years 600 main battle tanks, 775 armoured personnel carriers (M-113-A2), 185 combat aircraft/ Mirage and the Chinese F-7P). The navy bought 3 frigates from the UK. 3 modern submarines at US $600 million are on order from France. 18 missiles HATF 1/11 have already been deployed. An unspecified numberofChineseM-11 missiles have been inducted. Those have a capability of carrying nuclear warheads. Pakistan's defence budget for 1994 accounted for 34.53 of government expenditure at a total of Rs 237,795.2 billion.

Pakistan has received loans from Saudi Arabia and US for arms acquisition. Pakistan is reported to have siphoned off some 60 per cent of the weapons and equipment intended for the Afghan Mujahideen for equipping terrorists operating in Jammu and Kashmir.

Accurate figures for China's defence expenditure are difficult to assess. Estimates place it at US $31.18 billion. The Chinese armed forces are being modernized and more professional forces are being created in place of the cumbersome structure obtaining. China has developed a blue-water navy and is actively spreading its influence in Burma with a view to obtaining naval and air facilities in the Bay of Bengal.

In our case with an inflation rate currently around 11 per cent and soaring international prices for military hardware there are insufficient funds available for modernization. Approximately 60 per cent of the budgetary allocations are appropriated for the revenue account, pay and allowances, etc. The proportion available for the capital expenditure for combat and combat related stores including fuel and oil is hardly sufficient to maintain existing force levels. No major weapon system has been inducted since the Bofors deal.

The defence budget has increased by some 10 per cent. With inflation now at 11 per cent this would mean in real terms a decrease in defence allocations. It will be insufficient to maintain the status quo particularly as the proportion allotted to the revenue account will increase as a result of the upcoming recommendations of the pay commission.

The armed forces' expenditure in aid of civil power is increasing due to insurgency conditions in Jammu and Kashmir and the North-East. So far these costs have not been recovered from the Home Ministry allocations. Recovery of these dues will increase availability of funds for the armed forces.

The raising of the Rashtriya Rifles has not come up to the initial expectations. It was intended that these 36 battalions (enough infantry for 4 divisions) to be increased to 40 battalions would be financed by the Home Ministry. This has not been the case and the financing has to be borne out of the Army allocations. In the circumstances the Army could have raised regular infantry battalions which would have given the flexibility of using them both for counter-insurgency and if so required for induction into regular divisions or brigades. For the record this was the system earlier where regular infantry battalions were raised on a reduced counter-insurgency establishment. These modified infantry battalions wore used in the 1971 war with minimal reorganization. This system had the advantage of using the existing regimental layout and avoids the hybrid composition of the RR with all its attendant problems of milking regular units, postings, promotions and morale. It has aggravated the shortage of officers which is now in the region of 12,500. This is seriously affecting the operational efficiency of the Army.

The Army is manpower-intensive. The Army's ability to generate firepower and mobility are not commensurate with its manpower structure. Manpower has to be trimmed and firepower increased.

The armed forces require new weapon systems and force multipliers. Obsolescent equipment requires upgradation.

Provisioning of maintenance spares and ammunition, petrol and oil are essential. Planning presently is for a short war. A future conflict is likely to be protracted. Due to the vulnerability of our sealanes it is essential that stocks and reserves should be held for a conflict of longer duration than those of 1965 and 1971.

The armed forces for their part should pay more attention to interior economy. Savings can be effected in manpower and consumption of petrol and oil. Establishments should be reviewed to cut out nonessentials. It will be noticed that the Pakistan Army has comparatively much fewer headquarters. A number of headquarters can be eliminated. The staff at Army Headquarters and lower state formations can be reduced. The present ratio of teeth to tail is too low. The establishment of units should be reviewed in this light. The armed forces must work out priorities of 'musts', 'shoulds' and 'coulds' as there will never be sufficient funds to meet all projections.

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