A firm minimum figure must be accepted and endorsed at the highest political level if defence planning, which has a long-term gestation cycle, is to be realistic. This figure can be expressed in GDP proportion, as a proportion of central and/or government expenditure individually or collectively as recommended by the National Security Advisory Board six years ago. Given the Accountability Act and needs of macro-economic planning and fiscal prudence there will be an upper limit to available resources for defence. Current trends indicate that this is likely to be closer to 2.4 per cent of the GDP (growing at 8 per cent annually) for the next 15 years.

In order to manage at this or any other level assessed by experts (assuming that the finance ministry is willing and able to stick to it), a serious re-examination of our approach to defence planning would be needed. Defence planning is actually fiscal planning for defence: and fiscal planning for modernisation of men and machines is its most crucial aspect. For example, we may or may not cut the size of our military manpower since that decision must be based on actual operational tasks and needs. But we must reduce the costs of manpower with better planning. This becomes a greater imperative since the manpower for the future, of necessity, also needs to be high quality and hence even more expensive.

Given the complexities of modern military manpower planning, what is needed is a dedicated expert task force to examine various options and their implications if we are to manage the crisis of military modernisation that has already hit us. Meanwhile the bipartisan standing committee on defence of the Parliament needs to take a closer look at the issues involved in defence finance and economics. The Planning Commission has traditionally ignored defence planning and budgeting: but can it continue to ignore the imperatives of even developmental planning without paying attention to defence finance and economics? We badly need expertise in the country in this field. The Defence (Finance) Division should plan for follow-on studies and measures in this respect if full value of the energy and effort in convening the conference on the crucial issues affecting defence policy is to be realised.

... contd.