IAF funds crunch to hit MMRCA deal

[selvan33]

IAF funds crunch to hit MMRCA deal

The financial crunch that has led to one of the lowest hikes in defence expenditure in decades is set to hit modernisation hard with new statistics revealing that the Defence Ministry has set aside only a few million dollars for new purchases, putting the future of critical purchases like fighter aircraft in question.
A detailed breakup of the new budget that has recently been made available has revealed that the Air Force, which is hoping to sign several new projects this year including the Medium Multi Role Aircraft (MMRCA), has been allotted only $372 million for new schemes.

While the total modernisation budget for the IAF is $6.8 billion, the majority of it is under the committed liabilities head for projects that have been signed in the past. This includes projects like the C 17 transport aircraft, modernisation of the Mirage 2000 and MiG 29 fleet and deliveries of the Su 30 MKI fighters.

Under the head of 'new schemes', the IAF has been allotted a mere $372 million that experts say will not be adequate to cover the purchases planned this year. The MMRCA in particular, which will cost upwards of $12 billion, has not been budgeted for. As an industry norm, a payment of 5-10 per cent of the contract value has to be made at the time of signing. This itself will amount to $500 million, going by very conservative figures.

Sources conceded that the MMRCA has not been budgeted into this year's capital allotment to the IAF. However, they asserted that if the contract does reach a conclusive stage, money will be made available through other means to cater for the signing fees. Air Force Chief N A K Browne in particular has been expressing confidence that the deal would be signed in the coming months.

However, as things stand, the budgeted allocation for new projects will only cater for other projects that are also in the final stages. This includes the Chinook transport choppers, Apache attack helicopters, radar and other equipment.

Nonetheless, the IAF has got a lion's share of the capital budget for new schemes. The total budget for new projects this year stands at only $550 million, with the Navy getting a minimum amount of $82 million.

The Army will also have a tough time in managing new purchases with its $91 million budget that will have to cater for projects like the new M 777 howitzers from the US as well as the 197 light helicopter contract.

As reported earlier, India will spend its lowest on defence expenditure in over three decades after the government proposed a modest hike in the annual budget that amounts to just over five per cent over last year.

IAF funds crunch to hit MMRCA deal - Indian Express

 

[Pulsar]

But more than Rs100,000 crores have been budgeted for the stupid 'Food Security Bill'? This mind boggling amount is nothing but a way of making more moolah by corruption for the Congress in the guise of providing food for the poor and a few brownie points during next year's elections. Defence be damned!

 

[IndoUS]

But more than Rs100,000 crores have been budgeted for the stupid 'Food Security Bill'? This mind boggling amount is nothing but a way of making more moolah by corruption for the Congress in the guise of providing food for the poor and a few brownie points during next year's elections. Defence be damned!

Its all about the election, the government knows that it will have a serious time in the next election with all the corruption scandals going around, so they introduced the food bill to buy the votes. Even after knowing that this bill will now add a even bigger burden on the already large deficit.

 

[Thorough Pro]

After all defence is to protect the "people" from the enemies, but what if they are dying of hunger, wouldn't it be wise to protect them from hunger take a chance on enemy or let the people die of hunger and protect what?

But more than Rs100,000 crores have been budgeted for the stupid 'Food Security Bill'? This mind boggling amount is nothing but a way of making more moolah by corruption for the Congress in the guise of providing food for the poor and a few brownie points during next year's elections. Defence be damned!

 

[acid rain]

I call this Bull cr@p...

The payments will be made over maany years, the defense budget was only modestly hiked to bring down the Fiscal deficit.

I think its a propaganda by defense suppliers secretly pushed by the forces to keep the tap running.

I'll pull a ISRO2222 here,
The MOD wants to scrap rafale, first they create problem about price, later create issue about HAL and production and now it is funding....US, India and Japan are in collaboration so Indian Govt wants similar equipment as other two and wants to go for American Jets and the US are also pushing for it.

 

[Koovie]

Both the FM and the MoD already stated that whenever more funds are needed for important deals like this, more money would be made available.


Period.


I dont know whats wrong with those stupid journalists.

 

[anant_s]

We've had discussions on this topic on God knows how many times and don't understand why such type of news is given prominence. We are not paying all amount upfront and like all big deals payment has to be made on pro-rata basis. Such news may find takers in public domain, but here at PDF members are wise enough to understand such news carries absolutely no substance.

 

[Sergi]

Isn't this more than enough ??? Why people are going crazy over some "Brilliant" 's own analysis ???

Sources conceded that the MMRCA has not been budgeted into this year's capital allotment to the IAF. However, they asserted that if the contract does reach a conclusive stage, money will be made available through other means to cater for the signing fees. Air Force Chief N A K Browne in particular has been expressing confidence that the deal would be signed in the coming months.

Few points
- last years budget was around 40 billions
- this year percentage is increased but very little.
- our economy grow in last year ( whatever the percentage may be )
- so the amount will be more than that if last year as the increased percentage of increased GDP.
- and since when 500 million is Big amount for GOI ???

 

[Sergi]

After all defence is to protect the "people" from the enemies, but what if they are dying of hunger, wouldn't it be wise to protect them from hunger take a chance on enemy or let the people die of hunger and protect what?

Good thinking. Please right that in your country related discussions too.
And when next time somebody speak of "eating grass" please stand and speak.

And counties defence is more important than poverty eradication. Yu should know that. Grass theory was generated right from your Land.

And for the poverty and hunger issues - it can't be solved overnight. Appropriate measures are being taken in India. But increasing pollution is making it hard. Still we are working on it and it will continue till decade. Defence can't stop for that ... Specially when your neighbours are doing opposite to get nukes.

 

[Awesome]

So basically this deal will not materialize in this FY as per Indian financial planners. Unless the 300 mil are taken as some sort of booking fee in good faith for future purchases.

 

[Sergi]

So basically this deal will not materialize in this FY as per Indian financial planners. Unless the 300 mil are taken as some sort of booking fee in good faith for future purchases.

Sound like it. But anyways if they have to sign then 500 million is never a big amount.

 

[Thorough Pro]

You may find that out and many other things when you come out under the rock you live in and decide and let go of the crap your media feeds you.............btw Pakistani have a much better living standard than indians

I think that this is what always happens and is sufficient to clear doubts!!Nothing to worry about. . .


Does your country have such food security bill's!!??I mean youll find sufficient funds to increase your Nuclear stock pile and builf JF-17 Bl....err Thunders.

"Eating grass" is only a phrase referring to ones dedication, not really eating grass you moron................by the way what good is all that weaponry if all you supa pawa cant take actin against 20 Chinese foot soldiers

Good thinking. Please right that in your country related discussions too.
And when next time somebody speak of "eating grass" please stand and speak.

And counties defence is more important than poverty eradication. Yu should know that. Grass theory was generated right from your Land.

And for the poverty and hunger issues - it can't be solved overnight. Appropriate measures are being taken in India. But increasing pollution is making it hard. Still we are working on it and it will continue till decade. Defence can't stop for that ... Specially when your neighbours are doing opposite to get nukes.

 

[srshkmr]

@isro2222 whats your view on this?.

Our defence minister said that the time frame maybe extended for concluding the deal and dassault said it has no problems with HAL .

 

[bigzgvr4]

now they should buy f-35 jsf and join the production in that aircraft it is way better then anything india has right now forget the rafale, i heard pakistan was interested in it but no money, and given the current usa india relation it should not be a problem,

 

[Abingdonboy]

These figures just don't add up- a $42 BN USD defence budget and only $372 MN for capital acquisitions? I call BS. Indian express is playing loose with the facts in my opinion. And free the MoD, ACM, Def Min and Fin Min have ALL said there's the funds there- funding or lack there of is not an issue or a reason for the delays.


It seems like once the MMRCA gets over one hurdle another one is found or fabricated to put in its path.


With all the past nay-Sayers found to be lieing or atleast incorrect I can't help but feel there is a very deliberate plan of mid-information being played out here.



The deal will Be singed in the coming months- END OF STORY.