Misplaced priorities

India emerged as the largest importer of weapons in 2023, accounting for almost 11 per cent of all such international imports of different military equipment, reports Stockholm International Peace Research Institute (SIPRI). According to the report, India’s share (percentage) of global arms imports in 2019-23 was 9.8 per cent. During 2014-18, the corresponding share was 9.1 per cent and the percent change (in volume of the total arms imports between the two periods) from 2014–18 to 2019–23 was 4.7 per cent.

India: the largest importer of arms

During 2019-2023, India became the world’s largest importer of arms. Table 1 reveals, after Russia, France has emerged as the second major supplier with a share of 33 per cent supply. Out of six countries mentioned in the table, in the case of two countries—Saudi Arabia (rank 2nd) and China (rank 10th)— the percentage change in the global share in imports have reduced remarkably, 28 per cent and 44 per cent respectively. But in the case of Japan, imports during 2019-23 have increased by a whopping 155 per cent over the previous period. While China sources 77 per cent of its imports from Russia; Saudi Arabia, Israel and Japan source their arms, mostly, from the USA. China is the major supplier to Pakistan. Japan’s increased imports of arms is consistent with its reform in the pacifist constitution.

Table 2 and Fig 1 reveal how India’s arms imports increased during 1960-2022. Though the exact value of import for 2023 is not mentioned in the table, from India’s import data as mentioned in table 1, one can infer that in 2023, import value surpassed the import value of 2022. Interestingly, the peak values of arms imports coincide (including the current one) with the pre-election/election year of India’s Loksabha/Assembly elections.

Rising defence exports

India’s defence exports have reached Rs 21,083 crore in the financial year 2023-24, a growth of 32.5 per cent over the previous fiscal. During the last two decades, defence exports have increased by 21.5 times (refer to table 3). Defence Minister Rajnath Singh has termed this growth to be ‘spectacular’. “The increased defence exports are also an indication of the coming of age of the Indian industry,” Rajinder Singh Bhatia, President of Society of Indian Defence Manufacturers (SIDM), told Businessline. The Ministry of Defence expects the annual defence production to touch Rs 3 lakh crore, and defence exports at Rs 50,000 crore by 2028-29.

It is claimed that a strong push on ‘Atmanirbharta’ in the last decade has brought the country to a position wherein over 100 private and public sector undertakings (PSUs) are now exporting defence equipment and systems to more than 85 countries.

Though India is no longer in the list of ‘top 25 arms exporters’, Italy, Maldives, Sri Lanka, Russia, France, Nepal, Mauritius, Israel, Egypt, the UAE, Bhutan, Ethiopia, Guyana, Saudi Arabia, the Philippines, Poland, Spain, Chile, the USA, Armenia and Brazil are the major export destinations of Indian defence equipment. Akash missile systems, Dornier 228 aircrafts, ALH helicopters, Brahmos supersonic missiles, patrol vessels, unmanned systems, radars, simulators, explosives, avionics, surveillance systems, bullet-proof jackets, armoured vehicles and body spare parts for aircrafts and copters are the major export items, reports Businessline. In the 2022 SIPRI report, India was ranked as 23rd largest exporter along with Brazil and Portugal. All the three nations had an equal share of 0.2 per cent of global market share.

India’s emerging military industrial complex

Jha and Sharma (2023) have argued that India needs a military industrial complex for augmenting economic growth and enhancing national security. It is argued that the most major economies have a developed military-industry complex or the architecture that connects the military to the defence production industry, resulting in a win-win situation for both. The military gets the weapons while the industry profits from the sale. Experts believe that without doubt, the contours of a military-industrial complex are taking shape in India, which is resulting in a new ecosystem where there is a greater emphasis on a private role. It is observed that private role is a decisive step for the emergence of a military-industrial complex in India.

The Encyclopaedia Britannica defines military-industrial complex as a network of individuals and institutions involved in the production of weapons and military technologies. The military-industrial complex in a country typically attempts to marshal political support for continued or increased military spending by the national government.

The military-industrial complex in most economically advanced countries tends to have several characteristic features:

* A high-tech industrial sector that operates according to its own legal, organisational, and financial rules;

* Skilled personnel who move between administration and production; and

* Centrally planned controls on the quantity and quality of output.

Because of the technological complexity of modern weapons and the preference in most countries for domestic suppliers, there is little competition in most military markets.

Here are few major policy initiatives the Government of India has taken in recent past to facilitate the emergence of a military industrial complex:

* The Indian Defence industry was stringently limited to Public Sector Undertakings until 2001 when the Vajpayee Government, in an attempt to encourage Indigenous Defence production, allowed 100 per cent private Sector Participation and allowed FDI up to 26 per cent. Selling 26 per cent of the shares of India’s leading defence equipment manufacturer, BEML, to the private sector marked the first time in Indian history that the Ministry of Defence would lose control over one of its own companies, reports The Logical Indian.

* Till June 2018, Department of Industrial Policy & Promotion (DIPP) had issued 379 licenses to 230 Indian companies for manufacture of various licensable defence items. In addition to this, one manufacturing license was also issued by the Ministry of Home Affairs for small arms and ammunitions. 70 license companies covering 114 licenses reported commencement of production.

* As per the existing Foreign Direct Investment (FDI) policy, in the defence sector, foreign investment up to 49 per cent is permitted under automatic route. Foreign investment beyond 49 per cent (up to 100 per cent) is permitted through government approval in cases resulting in access to modern technology in the country or for other reasons to be recorded. The FDI limit for the defence sector has also been made applicable to Manufacturing of Small Arms and Ammunitions covered under Arms Act 1959.

* As part of the ‘Atmanirbhar Bharat’ (self-reliant India) package, the Union Government announced on May 16, 2020 that it would improve autonomy, accountability and efficiency in ordnance supplies by corporatisation of the Ordnance Factory Board (OFB), reports Dipankar Dey

* The defence ministry dissolved the OFB with effect from October 1, 2021, and transferred its assets, employees and management to seven public sector units (PSUs), according to an official order. In an order dated September 28, the defence ministry said: the Government of India has decided to transfer, with effect from October 1, 2021, the management, control, operations and maintenance of these 41 production units and identified non-production units to seven government companies (wholly owned by the government of India). These new defence PSUs are: Munitions India Limited, Armoured Vehicles Nigam Limited, Advanced Weapons and Equipment India Limited, Troop Comforts Limited, Yantra India Limited, India Optel Limited and Gliders India Limited.

* In 2021, the Union government opened doors for private players to run Sainik Schools in India. In their annual budget that year, the government announced plans to set up 100 new Sainik Schools across India. Till now, at least 40 schools have signed a Memorandum of Agreement (MoA) with the Sainik Schools Society (SSS), an autonomous body under the Ministry of Defence (MoD), to run Sainik Schools under Public-Private Partnership (PPP) model. However, it is reported that of the 40 Sainik School agreements so far, at least 62 per cent were awarded to schools linked to Rashtriya Swayamsevak Sangh (RSS) and its allied organisations.

* On June 14, 2022, the Union Cabinet had approved a scheme for Indian youth to serve in the armed forces. The ‘Agnipath’ allows patriotic and motivated youth (17.5 years to 21 years old) to serve in the Armed Forces for a period of four years. They are called Agniveers. After the period of four years, all Agniveers will go back to society. However, based on organisational requirements and policies promulgated by the Armed Force, Agniveers who have exited will be offered an opportunity to apply for enrolment in the Defence Forces in the regular cadre, the government note said.

Cautioning the world about consequences of the growing military-industrial complex, Gregory Hooks, wrote in Encyclopaedia of Violence, Peace, & Conflict (Third Edition), 2008, the military–industrial complex (MIC) has never been a neutral term. Dwight Eisenhower coined the term MIC in 1961 during his farewell address to warn the nation of a looming danger. The threat to democracy has been a recurrent theme in many studies of the MIC since Eisenhower’s warning. Eisenhower warned that the United States must “guard against the acquisition of unwarranted influence…by the military-industrial complex,” which included members of Congress from districts dependent on military industries, the Department of Defence (along with the military services), and privately owned military contractors—e.g., Boeing, Lockheed Martin, and Northrop Grumman. Eisenhower believed that the military-industrial complex tended to promote policies that might not be in the country’s best interest (such as participation in the nuclear arms race), and he feared that its growing influence, if left unchecked, could undermine American democracy.

Before proceeding further, Indian policymakers must evaluate the unwarranted consequences of MIC. Threat to democracy is already a reality in India.

Observations

In the Union Budget 2024-25, the Defence Ministry has been allocated Rs 6.21 lakh crore, which is the highest among all the ministries. For example, for FY 2024-25, the budget allocated to the health sector is only Rs 90,171 crore. The health allocation at 2.5 per cent of GDP should have been Rs 8,19,000 crore, given the projected GDP for 2024-25 of Rs 3,27,71,808 crore. Health being in the concurrent list, the Union government’s contribution (40 per cent) should have been at least Rs 3,27,718 crore. The National Education Policy, 2020, advocates that 6 per cent of the GDP should be spent on the education sector. This comes to Rs 19,66,309 crore, but in the current budget, education has been allocated Rs 1,24,638 crore. It shows the Union government’s lackadaisical approach to the basic needs of its citizens.

The security of the citizens of a nation has various dimensions. In addition to security from enemy invasions, it includes, among others, security from diseases, poverty, and natural calamities. It appears the Indian government has put utmost importance on the modernisation of the military only at the cost of other security measures which are equally important. Very low budgetary allocation for education and health departments are cases in point.

‘Atmanirbharta’ means self-reliance. The primary indicator of ‘atmanirbharta’ can be measured by the capability of the defence industry to become self-reliant by producing arms that substitute imports. Existing data does not reveal that. Export of arms is not a proper measure of self-reliance. It is reported that the much-hyped indigenous Light Combat Aircraft (LCA) is powered by a GE 404 engine from the US, while the radar is sourced from ELTA, Israel. The Kaveri engine development by the Gas Turbine Research Establishment (GTRE) has been an unmitigated disaster. The Main Battle Tank (MBT), a showpiece indigenous tank, is powered by German MTU engines, reports The Wire.

India has provided the world a number of great thinkers and philosophers. It is the land of Mahavira, Buddha, Ashoka, Kabir, Tagore and Mahatma Gandhi. The world, especially the global south, does not need cheap arms from India. It is waiting for another great leader from this land who would save mankind from the ‘encircling gloom’.

Views expressed are personal