Hike in defence allocation marginal, say experts

New Delhi: The 34 per cent hike in the defence allocation in the interim budget for 2009-10 presented in the Lok Sabha is at best marginal according to security experts. They opine that much of it is going to be used to pay arrears to the armed forces personnel after the hike announced by the Sixth Pay Commission.

Given the fact that the ministry of defence has surrendered Rs7,000 crore of funds which, though earmarked for arms purchases, have remained unutilized, the real quantum of increase is actually closer to 24 per cent. Most of this amount will be used to pay off arrears accruing from the recommendations of the Sixth Pay Commission.

In his speech to the parliament, external affairs minister and acting finance minster, Pranab Mukherjee said that a "threshold has been crossed" with the Mumbai terror attacks, and this necessitated an increased allocation of Rs141,703 crore in the interim budget for 2009-10.

In real terms the hike works out to only 23.6 per cent as the revised expenditure for 2008-09 has been placed at Rs114,600 crore against the allocation of Rs105,600 crore.

The 1.2 million strong Indian Army has received 41 per cent, or Rs58,648 crore, of the allocations, the Indian Air Force Rs14,318 crore and the Indian Navy Rs8,322 crore.