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Cuts in funds for DRDO forced it to put major projects on hold: Parliamentary panel

Discussion in 'Indian Defence Industry' started by lca-fan, Mar 10, 2017.

  1. lca-fan

    lca-fan Major SENIOR MEMBER

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    Cuts in funds for DRDO forced it to put major projects on hold: Parliamentary panel
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    NEW DELHI: A parliamentary panel today rapped the government for lower allocation of funds to the DRDO, saying it has forced the organisation to put on hold some its "major projects involving futuristic technology".

    It also said that due to the cut in the budget for the ordnance factories, they were not able to produce the equipment as per the orders placed by the army.

    The Standing Committee on Defence said during 2016-17, the projected demand for the Defence Research Development Organisation (DRDO) was Rs 18,782.86 crore. In the Budgetary Estimate (BE), the DRDO was marked Rs 13,593.78 crore.

    Similarly, in 2015-16, the BE allocation was Rs 14,358.49 crore, but in the Revised Estimate (RE) it went down to Rs 12,491.21 crore. The difference between the BE and RE was a sizable Rs 1,867.28 crore.

    "The committee note that out of total defence budget, the share of DRDO was 5.79 per cent in 2011-12, which reduced to 5.34 per cent in 2013-14.

    "The BE for 2016-17 was 5.46 per cent of the defence budget," the panel said in its report, which was tabled before the Lok Sabha today.

    Expressing concern over the "inadequate" budgetary support for the on going projects and revenue commitments, it said, "major projects involving futuristic technology have been put on hold".

    It also added that the cut in budgetary allocation for the DRDO has an effect of "jeopardising the scientific and technological base" of the defence forces.

    The committee also highlighted the issue of lesser allocation for ordnance factories that manufactures arms for the forces.

    It also termed as "sorry state of affairs" the wide gap between the BE and the RE. For instance, the BE in 2015-16 was Rs 3,644.30 crore, but in the RE it was allocated Rs 1,752.53 crore.

    "This is a sorry state of affairs. The cut applied at the RE stage and mismatch between the projections and actual allocations, Ordnance Factories Board could not produce the equipment as per the orders placed by the army," the committee said in its report.

    "This is reflective of the helplessness of Ordnance Factories," it said.


    http://economictimes.indiatimes.com...-parliamentary-panel/articleshow/57560324.cms
     
  2. lca-fan

    lca-fan Major SENIOR MEMBER

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    Is this not contradictory to what Modi govt's MII plan. Instead of increasing R&D money allocation the govt is actually cutting down spending. This can have negative impact on ongoing projects and will be delayed of which some are very critical like BMD, LCA MK1a/2, AMCA, Uttam AESA etc.

    @Levina @Abingdonboy @nair @MilSpec @Gessler @Robinhood Pandey @randomradio @vstol jockey @Hellfire @NS52 @BlackOpsIndia @Rain Man @Grevion @Nilgiri@GSLV Mk III @SrNair @dadeechi @Ankit Kumar 001 @kaku1 @Golden_Rule @IndiranChandiran @Lion of Rajputana @thesolar65 @Sathya @Butter Chicken @AbRaj @Agent_47 @bharathp @Aqwoyk @GuardianRED @PeegooFeng41 @Indx TechStyle @Ved Mishra @ni8mare @A_poster @Itachi @drunken-monke @Kalmuahlaunda @zebra7 @Marqueur @PARIKRAMA
     
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  3. dadeechi

    dadeechi Lieutenant FULL MEMBER

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    No this is not contradictory at all.

    Congress' philosophy has always been to nationalize assets and strengthen organizations that are deemed to be important for national security. This was the reason why Indira nationalized Banks, Oil, steel, mining, etc.

    Nationalization of these companies and kicking out of foreign private companies in the 1970s is what lead to the JP movement supported by foreign entities and culminating in Indira imposing the emergency.

    Congress has always funded and strengthened government organizations hence the UPA government insisted on DA tied up with HAL, which is government entity, for MMRCA contract.

    On the other hand BJP always stood for private entities.

    Congress = Made in India through Government controlled entities. Intellectual property is retained by Government of India.

    BJP = Make in India through private entities both local and foreign. This is where the crony capitalism kicks in.... while Intellectual property stays with the private entities mostly foreign...
     
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  4. Gessler

    Gessler BANNED BANNED

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    State-run enterprises are not the only component of MII. Increasingly, a big hand is being played by the private-sector enterprises. Manufacturing of ammo & other munitions is set to be privatized as well.

    Congress = Keep all major manufacturing bases in the hands of state-run companies so that flow of money happens entirely within GoI, each Minister is free to eat as much as he wants without disturbance by other involved parties.

    The difference is that most of these state-run agencies are simply inept. Their personnel care mainly about two things: Pension & Job Security - and their payment & benefits are available regardless of their quality of work. That's why most state-run companies in India (or any government office) breed incompetence. There is no meritocracy.

    As of Capitalism...well, it's the only type of system that actually works in a democracy and is capable of lifting people from poverty. Socialism sucks. The period between 1947 and 1991 sucked economically for this reason.

    The reason why India is a nearly $3 trillion economy today with a 7% growth rate is because of the 'Crony Capitalism' and the huge private-sector undertakings that sprung up in the 90s and 2000s. Although we have some big players here and there, Indian private defense enterprises is still a fledgling sector. Give it 10 years and HAL will be defunct as a production agency.
     
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  5. dadeechi

    dadeechi Lieutenant FULL MEMBER

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    The issue is not the type of the government but what truly matters is the

    1) Patriotism and Selflessness of the Leadership - Generally, people are patriotic but their selfishness overrides their patriotism towards their country. The selfishness and corruption manifests in many forms be it nepotism, power, wealth etc.

    2) Capability and Skill - The leadership also need to have the capability and skill to make right decision at right time

    3) Sustained Effort - The capacity to plan and execute

    It is the same government that produced IITs & IIMs that has produced inefficient PSUs.

    Now coming to the private entities, one may say the economy has increased under the capitalist system but did it really improve the lives of Indians proportionately? The answer is a big NO. The rich have exponentially benefited while the middle class has moderately benefited while the poor have marginally benefited or worse adversely effected. For example, take the case of farmer suicides? Why haven't any of the governments since 1991 were able to remediate this problem? The answer is simple. The capitalism is based on greed and greed alone. Monopoly, Cronyism and Capitalism are a deadly combination. There is reason why Big pharma sells drugs at such steep prices than the generics, there is a reason why seed companies sell GMO seeds which will not allow farmers to produce their own seeds, there is a reason why video games are moving from disk based to cloud based etc..

    A private defense entity would never work for the benefit the country rather for the benefit of its shareholders.

    It would invent, file patents and produce intellectual property for the sole benefits of its share holders and not to protect and benefit the nation.

    Worse it would accrue all these benefits at the expense of the Tax payers money with no risk.

    Crony capitalism capitalizes the profits and socializes the losses..

    Crony capitalism is worse than inefficient and corrupt socialism.

    What Countries need is true capitalism and democracy not these dangerous imitators, charlatans and swindlers in the name of capitalism and democracy.
     

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