India’s military budget increases less than expected as it struggles with China stand-off

India increased its defence spending by about 1 per cent, throwing the timing of its military modernisation programme into doubt while it faces a protracted stand-off with China along their disputed Himalayan border.

Overall, military spending increased to 3.47 trillion rupees (US$47.4 billion), up from 3.43 trillion rupees in the previous financial year, budget documents indicate. India’s expenditure is about a quarter of China’s – in May 2020, Beijing announced a yearly defence budget US$178.6 billion, according to data from the Centre for Strategic and International Studies.

There had been an expectation that India’s defence budget would receive a “robust increase” in response to the deadly clashes with Chinese troops in eastern Ladakh, said Laxman Behera, associate professor at the Special Centre for National Security Studies at Jawaharlal Nehru University in New Delhi.

“[It would have] signalled that India’s government means business when it comes to the nation’s sovereignty and security,” Behera said. “It looks like the defence minister will have to live with a shortfall for years to come.”

Both India and China have moved thousands of soldiers, tanks, artillery to the disputed border after clashes in the Galwan valley in Ladakh last June that left at least 20 Indian soldiers and an unknown number of Chinese troops dead. The clashes along their 3,488km boundary, known as the Line of Actual Control, come as China increasingly asserts its presence in the region and as India grapples with the world’s second-worst coronavirus epidemic and an economy in crisis.

Will a new China-Pakistan road lead to a military boost against India?

Nine rounds of talks between India and China have so far ended in a deadlock, although both sides have agreed to keep talking.

India had previously announced plans to spend US$250 billion over a 10-year period to 2025 on defence modernisation, focused on upgrading its ageing fleet of flighter jets, submarines, battle tanks and armoured vehicles. But budget restraints and a renewed focus on the local manufacture of defence assets have put that timeline in doubt.

And while India is among the world’s top five military spenders, most of the funds allocated for defence forces go toward the salaries of about 1.3 million serving personnel, pensions, infrastructure development, and repairs.

Other experts were unsure whether the budget was enough to meet all liabilities.

“The defence budget reflects the financial constraints faced by the government and the inescapability of spending on health and infrastructure to boost the economy,” said Amit Cowshish, a consultant with the Manohar Parrikar Institute of Defence Studies and Analyses and former financial adviser to the defence ministry.