Lok Sabha Question No. 5230 (UNSTARRED), answered on 2019-07-24
Subject: Defence Expenditure
Ministry: DEFENCE
Asked by: Ravneet Singh

## GOVERNMENT OF INDIA MINISTRY OF DEFENCE DEPARTMENT OF DEFENCE

## LOK SABHA UNSTARRED QUESTION NO.5230

TO BE ANSWERED ON 24 th  JULY, 2019

## DEFENCE EXPENDITURE

5230. SHRI RAVNEET SINGH BITTU:

Will the Minister of DEFENCE j{kk ea=h be pleased to state:

- (a)  whether  the  expenditure  on    Defence  has  never  been  near  3  per  cent  of  Gross Domestic Product (GDP) during the last three years;
- (b) if so, the details of the percentage expenditure of GDP on Defence during the last three  years,  year-wise  along  with  the  reasons  for  such  a  low  expenditure  on  armed forces;
- (c) the percentage the Government has spent on Defence in this budget; and
- (d) the steps taken by the Government to increase the expenditure on Defence?

## A    N    S    W    E    R

MINISTER OF STATE IN THE MINISTRY OF DEFENCE

(SHRI SHRIPAD NAIK)

रक्षा राज्य मंत्री

( श्री श्रीपाद नाईक )

(a) to (d):  A statement is attached.

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## STATEMENT  IN  RESPECT  OF  PARTS  (a)  TO  (d)  OF  LOK  SABHA UNSTARRED QUESTION No. 5230 FOR ANSWER ON 24.07.2019 REGARDING 'DEFENCE EXPENDITURE'

- (a) to (c): Details of Defence Expenditure (including Civil and Pensions), GDP, and Defence Expenditure as percentage of GDP, for the last three years are as under:-

(Rs. in Crore)

| YEAR    | Budget Estimates(BE)   | Actual Expenditure   | GDP                  |   BE as %of GDP |
|---------|------------------------|----------------------|----------------------|-----------------|
| 2016-17 | 3,40,921.98            | 3,51,661.01          | 153,62,386 (2 nd RE) |            2.22 |
| 2017-18 | 3,59,854.12            | 3,80,140.00          | 170,95,005 (1 st RE) |            2.11 |
| 2018-19 | 4,04,364.71            | 4,04,653.00          | 188,40,731           |            2.15 |
| 2019-20 | 4,31,010.79            | ------               | 211,00,607           |            2.04 |

Defence Expenditure is increasing every  year in absolute terms  implying higher spending. From 2016-17 to 2019-20, expenditure on Defence has increased by Rs. 90,089 crore.

Measuring  defence  expenditure  as  a  percentage  of  GDP  creates  an  illusion  of declined spending by ignoring the size of the Economy. If the economy grows at a faster rate,  spending  decreases  as  a  percentage  of  GDP,  but  it  doesn't  mean  that  the  level  of spending has fallen or has become inadequate.

For the year 2019-20, the total Defence Budget (including Civil and Pensions) is Rs.  4,31,010.79  Crore,    which  is  15.47%  of  total  Central  Government  Expenditure (Rs.  27,86,349  crore).    Also,  Capital  Budget  of  Ministry  of  Defence  for  2018-19  is approximately 31.97% of the total capital expenditure of the Central Government.

- (d)    There  is  an  increasing  trend  in  Actual  Expenditure.  Government  has  taken  steps  to delegate substantial financial power to the Service Headquarters for both normal and emergent procurements. This  has resulted  in  faster  decision  making  and  ensured  full and optimal utilization of allocated budget.

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