The Government has announced a substantial increase in pensions of jawans to meet a long-standing demand of the ex-servicemen community. Presenting the budget on Monday, Finance Minister Pranab Mukherjee said the enhanced pensions would benefit more than 12 lakh personnel below officers rank and would cost the exchequer Rs 2,100 crore annually.

While pensions for jawans have been increased, a similar raise for retired officers has not been announced and is expected to be resolved later. However, the non-inclusion of officers in the announcement has raised concerns amongst ex-servicemen who are waiting for a detailed explanation by the government.

The only change from the interim Budget that was announced in February is the decision to increase pensions for ex-servicemen, a matter that had taken a political turn after the BJP added it in its manifesto in the last elections.

“The government has decided to substantially improve the pension of pre-1.1.2006 defence pensioners below officer rank (PBOR) and bring pre-10.10.1997 pensioners on par with post-10.10.1997 pensioners,” Mukherjee said during his budget speech. He added that both decisions would be implemented from July.

Besides this, the interim Budget has been left untouched with the government allocating Rs 1,41,703 crore (2.35 per cent of the GDP) for the Defence Ministry. While this is a 34-per cent hike from the defence budget in the last fiscal, the increase will mostly go towards the increased salaries of employees decided by the sixth pay commission.

Significantly, the amount planned for modernisation of the Armed Forces has gone down to an all-time low of just 38 per cent of the total defence budget. The capital outlay this year has been planned as Rs 54,824 crore, mostly for artillery modernisation of the Army and procuring new aircraft for the Indian Air Force. However, a major share of 62 per cent of the budget will go towards pensions, maintenance and salaries of defence personnel.

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