No shortage of funds for modernisation plans: MoD

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New Delhi, Nov 21 (UNI) Reiterating its commitment towards modernisation in a time-bound manner, the Defence ministry today said there was no shortage of funds for its plans to modernise the country's armed forces.

Speaking at a national seminar on 'Defence Budget', Financial Advisor (Defence Services) H K Pannu said funds were inlenty and actually the fact was that the three Services had been unable to spend the money earmarked for purchases.

Rubbishing speculation that current outlays on defence were insufficient, Ms Pannu said outlay on capital expenditure had swelled to over 45 per cent in the current financial year and a major chunk of this had remained unutilised.

While stressing that India's defence spending, in real terms, was much lower than reflected in the defence budget, Ms Pannu proposed that funds for organisations and schemes like the NCC, ex-servicemen welfare and Sadbhavana programme be taken out of the defence allocation.

''This would give an impetus to reforms in the colossal defence budgeting and help better plan social sector and welfare schemes.'' IDSA scholar Laxman Kumar Behera, in his presentation said in the last eight years, the Services have been unable to spend between 1,490 crore rupees to 6,500 crores, amounting to anything between four to 31 per cent of total budgeted capital expenditure.

Even the CAG, in its 2005-06 report, cites delay in approval of plans and qualitative requirements, plethora of agencies involved, improper vendor identification and lack of objectivity and fairplay in the technical evaluation for the bottlenecks in the long-drawn out acquisition process, he added.

While in 2007 India was among the top ten military spenders in the world with a budget of US 24.2 billion dollars, in the last two decades its defence budget has shrunk from 2.96 percent of the country's GDP in 1989-90 to 1.99 per cent in 2008-09.


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