Focus: GS-III Indian Economy, Internal Security
Why in news?
It may be seen from data of economic survey that Defence Budget as a percentage of GDP may appear to be decreasing due to increasing trend in the growth of GDP. However, it is increasing in absolute terms, implying higher spending.
- The Indian Army, given its overwhelming size, continues to be the biggest stakeholder in the defence budget.
- Among the three forces, army has, however, the lowest capital share.
- Furthermore, its capital share has seen a decline, from a high of 26 per cent in 2007-08 to 18 per cent in 2020-21, largely due to increase in P&A, which accounts for 70 per cent of its total revenue expenditure and 57 per cent of the total budget in 2020-21.
- The army’s increase in the revenue share is a cause of concern considering its attempt to shift to the higher side of the technology-driven warfare which requires a much greater spend on capital assets.
- Note: Army includes Military Farms, Ex-Servicemen Contributory Heath Scheme (ECHS), Directorate General Quality Assurance (DGQA), Rashtriya Rifles, and National Cadet Corps (NCC). Navy includes Joint Staff.