Comment & Briefs

One area where the 2015-16 defence budget is likely to hurt the most is in capital acquisition, which has already been under acute pressure in recent years due to the overwhelming share of the ‘committed liabilities’ arising out of contracts already signed

It is a fairly simple exercise to estimate what the defence budget will be given available indicators. My assessment is that the Budget Estimate for defence is likely to be around Rs. 250,000 crore, with 105,000 crore for Capital Expenditure and 145,000 Crore for Revenue Expenditure.

The thumb rule in making a policy U-turn is “minimise damage or maximise advantage”. What is extraordinary about the Modi government’s U-turn is that it maximises losses and minimises advantages.

The Modi’s government determination to adopt a muscular stance on national security and its commitment to expedite defence modernisation are likely to translate into greater political and defence engagement with Israel.

There is a general feeling among analysts that while US government lawyers may have been satisfied that the CLNDA is compatible with CSC in light of explanations offered by the Indian government, this view is being reportedly challenged by nuclear industry lawyers.

There is an urgent need to conceptualise a policy framework as to what Make-in-India implies so far as defence production is concerned and how it is different from the existing policy framework.

While the exact nature of the understanding between the two countries is yet to be announced and in fact may never be officially released, it is possible to offer an outline of the possible “memorandum” with possible understandings on all the three liability issues as well as the administrative arrangements.

India’s nuclear deal with the US is driven less by technology requirements than by the need to be integrated into the global nuclear community and gain access to uranium imports for fuelling its nuclear power expansion plans.

The ‘Make in India’ drive of Prime Minister Narendra Modi offers a way of improving the country’s self-reliance in defence production. But for the MII to succeed in the defence manufacturing sector, the government needs to address some legacy issues.

The US will continue to do what it can for blocking rapprochement between India and China or Japan and China for it knows the danger of its loss of a dominant role in Asia. Despite all the distortions of time and space, the hard geographic reality of Asia will triumph just as it happened in Europe.