Budget LIVE: Defence allocation is Rs 2,46,727 crores, says Jaitley

[Abingdonboy]

@Abingdonboy @sancho

Israel's wind tunnel complex


Are we using this facility?

I'm sure the Barak-8/1 was tested there but other than that DRDO and HAL have their own such facilities so I don't see the need to use Israel's.

 

[Screambowl]

Drdo =11960 cr

If domestic players come into R&D of the weapons, this means along with DRDO at most 10% would be spent by AF, ARMY and Navy from their budget respectively. Adding to estmt. 30,000 Cr into defence research. Not Bad.

 

[sancho]

Personally,i wasn't expecting more than 10%.And,I cannot complain for 7%.

Why can't you complain, when your expectations were not met? And they surely wasn't too high.

I agree and @sancho I don't think there was much reason to expect a great hike in defence spending or much to justify it.

Well that depends on what you consider to be a great hike, doesn't it?

2014: GDP forcast between 5 and 6% (old calculation base), the government allocates 13% for the defence budget
2015: GDP forcast between 6 and 7% (old calculation base), the government allocates 7.5% for the defence budget

How can we allocate less, when the GDP forcast is better?
How was 13% justifiable last year, but not this year, when most of the expected deals wasn't done?

Are we using this facility?

Doubtful, when we even send AMCA models to the US for windtunnel testing.

 

[Abingdonboy]

How can we allocate less, when the GDP forcast is better?
How was 13% justifiable last year, but not this year, when most of the expected deals wasn't done?

Two points, this year the GoI had chosen to give more revenue to the states so less to allocate (although this will correct itself as India grows) and secondly, it is clear the GoI has other priorities beyond defence mostly in skill development and infrastructure spending. I still maintain that the defence budget as is is sufficient provided it is used otherwise what's the point in asking for these hikes when year in year out capex funds go unspent?

 

[SAMEET]

Now Pakistan will have to increase its defence budget. and they dont have money for it so the katoraa will be out again.

congrats bro by katora comment you just offended two big fish in PDF !

 

[sancho]

Two points, this year the GoI had chosen to give more revenue to the states so less to allocate (although this will correct itself as India grows)

Which it does, therefore more money will be available, not to forget that they have changed the taxation to get mor revenue too and as I showed, 13% would be $5 billion dollars ($4 if you take out the $1 billion they got back from the last budget), which is not much in the overall budget, but makes a difference in the defence budget!

what's the point in asking for these hikes when year in year out capex funds go unspent?

Depends on how much money is unspend, look at the procurements of the forces last year and tell me where the money went or how just $1 billion was returned, if hardly any new procurements were made?

 

[DeathInvader]

The Payments won't go immediately for a purchase. It will go over the time and hence this budget is adequate. For Make in India , the research will be done by private firms at their own cost and no additional funds will be allocated to them. Hence we save that money.
Also, the major purchases except MMRCA are ingeniously built and will be paid in Rupees and not Dollars. Navy is building almost everything ingeniously. Modernization and infrastructure will be also paid in INR. only the foreign imports will be paid in dollars. Hence this budget is adequate for now. More investment has also been allocated to R&D for public firms and JVs will also ease those funds. Also every future project has been coming up as a JV.

Also, the Rs.64000 for raising the Mountain Strike Corps will be built gradually in 7 year period and paid gradually too.

Jaitley to review raising of new mountain strike corps on Sunday - The Times of India

Read that link. Rs.39000 were already allocated and kept in reserve for them in 09-10 budget.

@sancho @Abingdonboy

 

[anant_s]

What will happen to those unspent 6639cr ?

This will be returned back to finance ministry
An explanation for why the expenditure could not be made will also be required
I'm actually looking for the heads against which the money remained unspent.
@ abingdonboy any ideas?

 

[Darmashkian]

Andhra Pradesh chief minister and NDA ally N Chandrababu Naidu struck a discordant note after the presentation of the Union Budget on Saturday, blasting the Union government over what he termed as a "budget which has let down the people of Andhra Pradesh".

Naidu was protesting against the non-operationalisation of the Andhra Pradesh Re-organisation agreement which entailed a grant of some major funds to the state, following the bifurcation of the state into Telangana and the residual state of Andhra Pradesh.

The CM's public airing of his grievances doesn't augur well for the BJP-TDP alliance in the state, especially after parliamentary affairs minister M Venkaiah Naidu had said that the Centre had allocated enough funds in the budget which "has to be seen in consonance with the disbursal of funds under the 14th finance commission".

Political events too are driving a wedge between the two allies, not least the growing proximity between Telangana Rashtra Samithi (TRS) chief K Chandrashekhara Rao and Prime Minister Narendra Modi, with some even saying that KCR's daughter, Nizamabad MP K Kavitha, could find a place in the Union Cabinet in April when it's due for an expansion.

More than anything, however, it is the BJP's own expansionist plans that are the heart of the problem. Naidu wants to play big brother in the state, but the BJP, having already managed to bag three former MPs and 10 former MLAs from the Congress, is eyeing the restless flock from YSR Congress in order to expand in the state.

Read more at:
Chandrababu Naidu’s Budget bashing to affect NDA-TDP alliance - The Economic Times

http://www.deccanchronicle.com/150301/nation-politics/article/jana-sena-founder-pavan-kalyan-meets-chandrababu-naidu

Hyderabad:Top Telugu actor and Jana Sena Party founder Pavan Kalyan, whose campaign helped in the success of TDP-BJP combine in Andhra Pradesh during last year's elections, on Sunday met Chief Minister N Chandrababu Naidu here.

The meeting, which lasted for more than an hour, assumes significance against the backdrop of Naidu expressing deep disappointment over the Union Budget for allegedly not doing enough with regard to promises made to the state in the Andhra Pradesh Reorganisation Act.

While there was no official word on the meeting, the two leaders are understood to have discussed the issue of alleged non-implementation of promises made to the people of Andhra Pradesh during last year's election and bifurcation.
The Jana Sena leader had recently remarked on social networking sites that it is time that steps are taken for the implementation of promises made to AP during bifurcation. Kalyan, the younger brother of former Union Minister and actor-turned-politician Chiranjeevi, had campaigned along with Naidu and the then NDA's Prime Ministerial candidate Narendra Modi for the success of the TDP-BJP combine in the Lok Sabha and AP Assembly elections last year.

Recalling that the TDP and BJP together, including Modi, had made promises to people of Andhra Pradesh during elections, Naidu yesterday said that it was the responsibility of the combine to fulfill them.

 

[Ronin]

No money for Rafale
Would not be be surprised if higher orders for LCA mk2 is placed in 2 month

 

[MokshaVimukthi]

Well that depends on what you consider to be a great hike, doesn't it?

2014: GDP forcast between 5 and 6% (old calculation base), the government allocates 13% for the defence budget
2015: GDP forcast between 6 and 7% (old calculation base), the government allocates 7.5% for the defence budget

How can we allocate less, when the GDP forcast is better?
How was 13% justifiable last year, but not this year, when most of the expected deals wasn't done?

Its called Fiscal prudence. Target being to reduce our Fiscal deficit from 4.1 % of GDP to 3.9 % and this year to 3.6 % the year after than to 3.1% for year 2016-17.

Better to spend money WE HAVE than to spend money we DON"T HAVE. Simple economics really.

The Payments won't go immediately for a purchase. It will go over the time and hence this budget is adequate. For Make in India , the research will be done by private firms at their own cost and no additional funds will be allocated to them. Hence we save that money.
Also, the major purchases except MMRCA are ingeniously built and will be paid in Rupees and not Dollars. Navy is building almost everything ingeniously. Modernization and infrastructure will be also paid in INR. only the foreign imports will be paid in dollars. Hence this budget is adequate for now. More investment has also been allocated to R&D for public firms and JVs will also ease those funds. Also every future project has been coming up as a JV.

Also, the Rs.64000 for raising the Mountain Strike Corps will be built gradually in 7 year period and paid gradually too.

Jaitley to review raising of new mountain strike corps on Sunday - The Times of India

Read that link. Rs.39000 were already allocated and kept in reserve for them in 09-10 budget.

@sancho @Abingdonboy

Make no mistake, Rafale will be paid for in Dollars, at least a large part of it will be. The only part that will be paid in Rupees is the salary of the HAL employees which will be around 10% of the total cost, you can add electricity charges to that.

Everything else is going to be imported, from metals to electronic chips to components to sub modules.

 

[definitelynotIndian]

can't understand this visa on arrival thing for more than 150 countries... wouldn't that undermine national security interest?

Only a handful of nations are trouble makers, they are not included.

 

[Abingdonboy]

Also, the major purchases except MMRCA are ingeniously built and will be paid in Rupees and not Dollars.

Hmmm, not really true bro- none of the CH-47Fs, AH-64Es, A330 MRTTs or S-70Bs (all deals likely to be signed this year) will be built in India.

Navy is building almost everything ingeniously.

The hulls are built in India but still a lot of the sensors, weapons and propulsion equipment is procured from abroad even if some is built in India. I think the figure is something like 60% of the value of the larger IN ships is made up of foreign equipment (not to say that the foreign content is 60% but that foreign equipment is inherently more costly).

No money for Rafale
Would not be be surprised if higher orders for LCA mk2 is placed in 2 month

Inaccurate:

However, the defence ministry had told the parliamentary standing committee in late 2014 that when the MMRCA is contracted, additional funds would be made available.

Just got to get this deal signed, the money is there- it was never about the money.

 

[DeathInvader]

Hmmm, not really true bro- none of the CH-47Fs, AH-64Es, A330 MRTTs or S-70Bs (all deals likely to be signed this year) will be built in India.

Only Initial 15% has to be paid this year right?

 

[Abingdonboy]

Only Initial 15% has to be paid this year right?

10-15% depending on the deal, yes. All these deals can be signed it is just a question go getting the contracts in order.