Rafale Deal Controversy: A political fight to demoralise our forces

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Congress launched fresh salvo on the government over the Rafale deal during the winter session of the parliament. Congress slammed the deal, terming it a scam of Rs 50,000 crore.

Defence Minister Nirmala Sitharaman rejected opposition’s demand to disclose the breakdown price of the Rafale deal.

Opposition refused to accept the reason given by the government. Congress president Rahul Gandhi took a swipe on the government and termed this deal as a scam and alleged Prime Minister Narendra Modi for personally getting this deal done.

During UPA government, deal of USD 12 billion which amounts to Rs 78,000 crore (approx.) was inked for 126 Medium Multi Role Combat Aircraft (MMRCA), Rafale Fighter jets. Out of these 126 jets 18 were to be procured in ‘ready to fly’ condition and rest 108 fighter jets were to be produced in India by Hindustan Aeronautical Limited (HAL). UPA government failed to conclude the deal before the elections 2014.

After coming to power NDA government scrapped the old deal and signed fresh deal to procure 36 fighter jets in ‘ready to fly’ condition for Euro 7.8 billion which amounts to Rs 59,000 crore (approx.). According to this new deal 75 percent Rafale fleet will always be operational as compared to UPA’s Rafale deal which was only 48 percent.

Congress also alleged that cost of each Rafale fighter jet rose to almost three times from Rs 526 crore to Rs 1,570 crore.

Congress spokesperson Sanjay Jha said, “It is a very opaque government. It is absolutely astounding, if you read the agreement, secrecy clause applies only the issue of technology, intellectual property right. It cannot be applied to price. Price is in the public domain, after all it is a biding.”

Jha further added, “We are only asking the government for the breakdown of the cost. We were getting it for Rs 526 crore and they are paying Rs 1,500 crore. We want to know what government is hiding.”

Bhartiya Janta Party (BJP) spokesperson Krishna Sagar Rao hits back at Congress. Speaking on the entire controversy, Rao said, “Rahul Gandhi and his party have hit a dead end. They are approaching elections with no issue against the government. No wonder the search for issue has redirected him to Rafale deal which is driven by his own government in 2005.” Clarifying government’s stand on the issue of confidentiality Rao said, “While the confidentiality argument and the overall choice of Rafale is made by the Congress regime. Government has nothing to hide. In fact UPA government had given the same answer when they were in power when the same issue was raised in the parliament.”

Opposition is also raising questions over the 50 percent offset deal between Dassault and Reliance Defence Ltd. Congress blamed PM Modi for favoring Anil Ambani’s Reliance Defence Ltd. for getting Rs 30,000 crore deal as a Indian partner to Dassault  as Reliance has no expertise in this field.

Jha said, “Large section of those defence offset has been given to a private contractor and not to HAL. HAL is a public sector company with expertise and earlier also had working agreement with Dassault .The agreement was signed on 13th March 2014.”

Whereas BJP spokesperson Rao termed it as a part of ‘Make in India’ campaign to give boost to indigenous industries in defence sector. Rao said, “We wanted to ensure that Indian companies should get a fair chance to manufacture it locally and that applied to even defence sector.” Taking a jibe at congress Rao further added, “All these are global tenders and biding processes which are transparent and open and not made in family tight rooms like done in UPA regime.”

The deal signed by the NDA government capped inflation at 3.5 percent as compared to that of previous deal which was 3.9 percent.

Defence expert, Air Marshal (Retd.) Kapil Kak termed the entire controversy as political fight which will have negative consequences on armed forces. Air Marshal (Retd.) Kak said, “It is not that one deal is better or other deal is better, we are just comparing apple and oranges. In case of UPA Rafale deal it was mere speculation of what we could have got, but in case of the deal signed by NDA government we have proper contract with precise details of what we are getting out of the deal.”

Speaking on the issue of government not disclosing the breakdown price of each fighter jet, Air Marshal (Retd.) Kak said, “The government had entered confidentiality pact with the French government as France is also selling the same fighter jets to other countries.”

Now the question arises that if UPA government had concluded the deal, then there would have been any controversy?

Currently our Air Force is short of fighter jets. We need to have 42 squadrons of fighter jets but we have only 33 squadrons.

Our defence forces need modern technology and equipment to counter increasing threat on the borders instead of these controversies. We need to build morale of our defence forces, rather than fighting over a defence deal. Controversies like these will demoralise our forces.

We need to fulfil the gap of rest 90 fighter jets, as we are purchasing only 36 Rafale jets instead of 126 jets, but our leaders busy in questioning each other to satisfy their political motives.

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Defence Budget 2018 is another farce, 1.58% allocated for defence

 

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Picture Courtesy: Rediff.com

In the union budget for the financial year 2018-19, Finance Minister Arun Jaitley allocated Rs 2,95,511.41 crore for defence.  The defence budget is hiked by 7.81 % by the previous year’s budget.  Out of the total outlay for defence only Rs 99,563.41 is allocated for capital expenditure which includes modernisation expenditure for the forces, whereas Rs 1,95,947.55 for revenue expenditure.

In addition to the defence budget Rs 1,08,853.30 is allocated for defence pensions.

This year’s defence budget is only 1.58% of the Gross Domestic Product (GDP), which is lower than last year’s allocation in terms of percentage. After the war against China in 1962 this is the lowest allocation to defence forces.

Despite the recommendation of defence panel that the defence budget for the financial year 2018 should be around 2.5% of the GDP to reduce the shortages of equipment and technology in our defence forces.

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The other major highlight of the budget is that Jaitley in his budget speech said, ”We have opened private investment in defence production and liberalisng foreign direct investment. We have also taken measures to develop two defence industrial corridors in the country and industry friendly defence policy in 2018-19.”

This time around there was no surrender of capital expenditure to the government in 2017-18 unlike that of previous years.

Our forces need modernisation on the priority basis, but this budget seems far too less to fulfil the shortages of our forces.

Expectations from Defence Budget 2018-19 and needs of our Defence Forces

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Picture Courtesy: SSbcrack.com

The defence budget for the year 2017- 18 was Rs 2.74 lakh crore, which amounts to 1.56 percent of the Gross Domestic Product (GDP).

According to defence experts this is the lowest ever budget allocated to defence forces in terms of percentage. Defence expert Air Marshal (Retd.) Kapil Kak said, “This financial year’s budget was the lowest since 1956-57. At the time of China war in 1962 we were going at 1.59 percent and for the next 30 years after the war we maintained the average of three percent of the GDP. From 1992 onwards there is a steep downfall in the defence budget.”

Defence budget is utilised to meet revenue expenditure and capital expenditure.

India is a growing super power which is surrounded by arch rivals Pakistan in the west and China in the north. In addition to this, India has to fighter terrorism and insurgency, so defence budget must fulfill all the needs of our defence forces.

Now let us look at the needs of our Defence Forces:

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If we talk about army, Indian Small Arms System Rifles (INSAS) needs to be replaced with modern assault rifles. Currently army is using AK – 47’s and INSAS. Personal kit of an Indian soldier, which includes bullet proof jackets, helmets and shoes needs to be replaced with lighter kit. Defence analyst Mandeep Singh Bajwa said, ”The army doesn’t have modern assault rifles, steel helmets and bullet proof jackets. In addition to this we also need to strengthen our Mountain Strike Core.“ The Indian Army rely mostly on Russian built T-72 and T-90 tanks . The army needs indigenous built tanks to fulfill the gap.  Indigenous built Arjun Mark II is still in trial phase, though this main battle tank has more fire power as compared to Russian tanks. We need artillery guns as our main artillery gun Bofors has become outdated. Defence Experts Maj. Gen. (Retd.) GD Bakshi said,” We need to plug the gap in the artillery. We haven’t had a gun since last 30 years ever since the Bofors scandal hit us.”

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If we talk about Air force, the picture is not too bright either. There is a major shortage of fighter jets. Currently we have 33 squadrons of fighter jets, whereas IAF need to have at least 42 fighter squadrons. This figure will reduce further as Mig fighter jets will be decommissioned over the coming years. Initially government had signed deal to procure 126 French fighter jets, Rafale, 36 of these fighter jets will be delivered by 2019 in the ‘ready to fly’ and government of India plans to manufacture 90 in India. Induction of Indigenous built Tejas will also narrow the gap, but this aircraft needs improvement to match the requirements of IAF.

IAF is also thinking of buying American fighter jets F-16 or Sweden’s Gripen to increase its strength.

There is a tremendous shortage in the allocation of capital expenditure to the Air force. Even if we induct more air crafts we don’t have proper infrastructure to keep them. According to anonymous defence source, “Runway resurfacing needs to be done, aircraft hangers needs to be build, which requires a lot of funds. The work is getting stalled due to the lack of funds. Minimum RS 700-800 crore is needed to build proper infrastructure. We have bigger carry over liability in year 2018-2019, so the works are going to be stalled.”

According to Air Marshal (Retd.) Kak, In the financial year 2016-17 only 12% of the capital expenditure was used for the modernisation which went into new schemes, rest 88 percent of the capital expenditure was used to payback old liabilities.

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The picture is also gloomy in the Indian navy. There is a shortage of submarines. We have currently 14 submarines in operation; half of them have completed their 75 percent of the service. INS Kalvari has been commissioned into the navy under project-75 and five more submarines will be inducted under the same project in the coming years. Senior defence analyst Commodore GJ Singh said, ”We need to have at least 24 submarines. Currently we have only one aircraft carrier along the western coast, but we need another air craft carrier along the eastern coast also.” Commodore Singh further added, ”If we want our navy to be a ‘Blue water Nay’, attention needs to be paid on the modernisation of the navy.”  Construction of 12 Mine Countermeasures Vessels are also pending at Goa Shipyard Limited (GSL). There is delay in importing 16 medium multirole helicopters of 12 tonne each. Our navy requires a replacement of obsolete cheetah helicopters.

These are some of the major requirement by the three wings of our defence forces.

Defence budget in 2016-17 was Rs 2.58 lakh crore which amounted to 1.71 percent to the GDP. The important thing to note is that, almost Rs 6,000 crore was surrendered to the government. The defence budget of the financial year 2017-18 was hiked by 6 percent from that of the previous one. If we talk about the coming budget of 2018-19, Defence experts are of the opinion that it should be around three to four percent of the GDP. Defence analyst Bajwa said, ”Defence budget should be four percent of the GDP to cater to the capital expenditure in terms of buying new weapons and equipment which at the moment is very very discouraging.” Air Marshal (Retd.) Kak estimated the budget to be minimum three percent of the GDP.

Bhartiya Janta Party’s (BJP) national spokesperson Krishna Sagar Rao said, ”There must be a possible rise of two percent i.e. eight percent hike on the previous year’s  (2017 – 18 ) budget allocation. This is only an anticipation.”  Rao further added, ”The increase of eight percent in the budget outlay can also be enhanced as multiple defence panel recommending that it should be around 2.5 percent of the GDP.” Talking on the issue of underutilisation of the capital expenditure Rao said, ”There is an issue in terms of modernisation expense. This expense is not fully consumed year after year. Almost Rs 6000 crore was not spent in the financial year 216-17. This year we are focusing on full utilization of the modernization expenses.” BJP spokesperson also signals that large scale acquisition of fighter jets and submarines are in the pipeline.

According to defence experts, this year the government will be under pressure. This will be the last full budget as elections are approaching in 2019. There are chances that the government will spend more money in social sector. Government will want to bring fiscal deficit under control, so in that case limited budget will be allocated to defence.

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Picture Courtesy: Hindustan Times

It will be interesting to see how the government gives priority to modernise the defence forces in the budget or will appease the voters?