New Delhi(PTI): Union Defence Minister Manohar Parrikar on Monday avoided commenting on United States Secretary…
Kolkata9The Telegraph): New Delhi: Defence minister Manohar Parrikar on Friday said he had asked the armed forces to “cut flab”, a directive that the military is in a tizzy about because it believes it optimises scarce resources.
Parrikar was speaking at a news conference this afternoon that was called to explain that the allocation for defence in the Union budget was not falling short of demand. Even the defence ministry was initially confused about the allocations for two reasons. First, finance minister Arun Jaitley had not mentioned the amount for defence in his speech. Second, he had also pared down the number of “demands for grants” for defence from eight to four.
Parrikar said the total allocation for defence in the Union budget for 2016-2017 was Rs 3,41,000 crore, including defence pensions. This was 17.23 per cent of overall central expenditure of Rs 19,78,060 crore.
This total defence allocation includes about Rs 82,000 crore for pensions. Parrikar said about Rs 70,000 crore would be available to buy new equipment for the armed forces (capital expenditure).
The defence minister said that a first-time stock-taking of cash flow for defence purchases has found that $3 billion was held in an account with the US government for government-to-government contracts.
“The money had piled up and was not used because of ill management (sic)”, said Parrikar. “But last May/June we realised that the money was lying there quite unnecessarily. So we re-calibrated the full management for the $3 billion and now it has come down to about $1.7 to $1.8 billion,” the minister explained.
The defence ministry estimates that it will return about Rs 13,000 crore of unspent capital funds in the current year. “Money is being paid but we are also saving,” he said.
To further increase savings he had asked the armed forces to identify areas where they could “cut flab”.