Allocations, in the time of war: A modest fifth of the budget goes to defence

Saturday, June 2nd, 2012 9:31:41 by


With an active war in the immediate neighbourhood, and militancy within its borders, Pakistan allocated a lion’s share of Rs643 billion to the defence budget for fiscal year 2013.

The allocation for upcoming fiscal, however, is 10.2%, or Rs59 billion, higher than allocation for the outgoing year, Rs584 billion. With inflation around 11%, this means a net decrease in defence allocation in real terms.

The military overspent by Rs15.2 billion from its original allocation of Rs569 billion. The revised allocation for the outgoing fiscal was attributed to the withholding of Coalition Support Fund by the United States due to strained ties between the two countries.

Pakistan has not received a cent from the United States under CSF since December 2010. The fund was established in 2001 to cover some of the costs incurred by Pakistan in the fight against terrorism.

Details of allocation

According to the budget document 2012-13, of the Rs545.2 billion allocated to defence spending, Rs229.4 billion have been allocated for employees-related expenses, Rs143.2 billion for operating expenses and Rs120.5 billion have been earmarked for physical assets. Over Rs98 billion has been allocated for pensions of military personnel, though that has been listed under the civilian budget and there is a separate allocation for security-related expenses. Critics say this move seeks to conceal the actual defense budget.

Scrutinising defence spending

Calls have been made for greater scrutiny of defense spending since the May 2 Abbottabad raid that embarrassed the military establishment over their ignorance of Osama Bin Laden’s whereabouts and the US operation.

Following the incident, Army chief General Ashfaq Parvez Kayani called for diverting the US military assistance to the civilian authorities.

The defence budget, however, has never been debated in detail in parliament.

Keeping up with the neighbours

Pakistan raises its defence spending every year because of its historically uneasy relations with neighbouring India – last year both neighbors matched each other by equally raising their defence spending by 12%, though the size of Indian defence budget is much higher than that of Pakistan.

Earlier this year, however, India further boosted military spending by 17% to billion, as it seeks to counter China’s rapid military build-up and its traditional rival Pakistan. Relations between the nuclear-armed neighbors have improved in recent years though after the two countries agreed to resume the peace process suspended following the November 2008 Mumbai attacks.

Defence analysts, however, believe that given the internal security challenges, much of the defense budget would be spent on the fight against militancy within Pakistan.

Published in The Express Tribune, June 2nd, 2012.

Islamabad News Sources -2

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