The MoD has to some extent addressed the concerns of the IAF even as allocations for civil aviation maintain last year’s momentum.

Pithy and precise, allocation for the defence sector in Finance Minister P. Chidambaram’s 2008-09 Budget was contained in the traditional twoliner. Presenting the Budget to the Indian Parliament on February 29, Chidambaram said: The allocation for defence is being raised by 10 per cent from Rs 96,000 crore to Rs 1,05,600 crore ($26.5 billion). Adding: I have assured the Raksha Mantri (Defence Minister) that more money would also be provided if necessary, especially for capital expenditure.

On the day the Budget was announced it was not clear as to how much would be the share of each service. However, it was being hoped that the Indian Air Force (IAF), highly capital-intensive service that it is, would continue to get a bigger share of the pie so far as capital budgetary allocations are concerned so as not to derail its modernisation programmes. The now released figures for the three services reveal that the hopes were not entirely misplaced. The Ministry of Defence appears to have to some extent addressed the concerns of the IAF which has hit new lows in terms of its fast depleting force levels and obsolete operational/ support equipment. Last year, the IAF had been allotted Rs 16,660.17 crore ($3.70 billion) for capital expenditure, compared to Rs 11,374 crore ($2.52 billion) for the army and Rs 10,000 crore ($2.22 billion) for the Indian Navy, at the then prevailing exchange rates. This year, too, the IAF remains at the top of the table with a slightly increased allocation of Rs 18,281.42 crore ($4.57 billion) at the current exchange rates against a weakened US dollar. In the case of the army and navy, however, the trend seems to have been reversed with their share being Rs 10,057.29 crore ($2.51 billion) and Rs 11,328.59 crore ($2.83 billion), respectively. The above allocations pertain to only major hardware such as aircraft and aero-engines, heavy and medium vehicles, naval warships and other major equipments. It does not cater for other sundry allocations which when added up take the combined capital allocations to a figure of Rs 48,007 crore ($12.175 billion).