Pranab raises defence spending to 'foster development'

New Delhi: Defence expenditure has been raised to Rs.147,344 crore for 2010-11, up 8.13 percent from the revised estimates of the previous fiscal, in the budget presented by Finance Minister Pranab Mukherjee in the Lok Sabha on Friday.

"Secure borders and security of life and property fosters development. I propose to increase the allocation for defence to Rs 147,344 crore. This would include Rs 60,000 crore for capital expenditure," Mukherjee said in his budget speech.

"Needless to say, any additional requirement for the security of the nation will be provided for," he added.

Defence Minister A K Antony declined to comment on the allocations.

Though the expenditure has been hiked by Rs 11,080 crore, in real terms, however, the hike works out to only 3.98 percent as Rs 141,703 crore had been originally allocated for 2009-10 but this was later revised to Rs 136,264 crore.

The allocation for 2010-11 works out to 11 percent of India's Rs 11,08,749 crore budget for the fiscal, down one percent from the previous year

The capital expenditure of Rs 60,000 crore is higher by Rs 5,176 crore than the Rs 54,824 crore originally allocated for the previous fiscal but Rs 7,000 crore of this was returned as unspent. A similar amount was returned in 2008-09.

As in the past, the 1.2 million-strong Indian Army has been granted the lion's share, but at Rs 57,326 crore this is lower by Rs 1,322 from the Rs 58,648 crore originally allocated for 2009-10, Rs 740 crore of which was returned.

The Indian Navy has been allocated Rs 9,329 crore, Rs 1,007 crore more than the Rs 8,322 that was allocated for the previous fiscal which was later raised to Rs 9,312 crore. In real terms, the raise amounts to just Rs 17 crore.

In the case of the Indian Air Force, its allocation of Rs 15,210 crore is Rs 992 crore higher than the Rs 14,318 allocated for the previous fiscal that was later raised to Rs 14,681.

The ordnance factories are perhaps the biggest losers. Originally allocated Rs 832 crore for the previous fiscal, this was raised to Rs 2,187 crore and has now been pegged at Rs 246 crore for 2010-11, a reduction of Rs 1,941 crore or 88 percent.

The Defence Research and Development Organisation (DRDO) has got a hike of Rs.881 crore to Rs.5,230 crore from its revised allocation of Rs.4,349 crore in the previous fiscal.