Plea to Activate a National Defence Fund in India

It is a known fact that India's funding on defence is dismal in terms of its GDP when compared to its neighbours. A major portion of the annual Indian budget on defence goes to salaries and establishment. Only less than half or one thirds of amount is left for the purchase of arms. The budgetary allocation in terms of GDP in India has been around 2.5% whereas Pakistan spends 5% of its GDP. Though China claims that its expenditure on defence in terms of GDP is around 2.5% many critics feel that this is underestimated and actuals would be 5%. Moreover China has been experiencing a double digit GDP growth for the past several years and hence its GDP percentage on defence would appear low. In fact China's 5% GDP would be India's 10% GDP.

While India's threat perception remained high, the budgetary allocation for the defence sector remained low. Many argue that India has to address more compelling issues such as poverty alleviation, unemployment, water scarcity, lack of infrastructural facilities, etc., than spending on defence. But then it leads to a situation wherein the national security and the defence preparedness would be compromised to a greater extent both in the short time and in the long run. Is there a way out that would balance the two issues i.e. defence spending on one hand and expenditure on developmental activities on the other? One of the solutions that could be offered is to activate the National Defence Fund (NDF) wherein the interested citizens of the country may volunteer to donate an amount that they wish for the purpose of acquisition of arms and ammunition for the Indian armed forces. All such donors should receive tax benefits i.e. 100% tax exemption. One of the advantages of this scheme is that even those who evade tax would come forward to turn their black money into white money. But it only needs wide publicity.

The money accumulated under this fund should be exclusively used for the purpose for which it has been instituted (procurement of arms). Attempts will be made to reduce the regular defence budget showing the money available under NDF and people like Mr. Chidambaram will leave no single opportunity to do this. That should not be the case. Once again critics may argue that when India has millions of people below poverty line why not route such a fund for the benefit of downtrodden. However history has shown that whatever freebies, subsidies and other popular measures be taken they never reach the target people but siphoned to ruling party men and middlemen. So far we have not found any mechanism to check this. As a result poor remain poor even after such freebies. Even if some of the popular measures reach the target people (may be 20%) the fact remains that these are temporary phenomena but what we need is a permanent solution. It can be in the form of creating more employment opportunities. More over there are already several government-sponsored programs available in addition to various NGOs, philanthropic organizations participating to address the problems of downtrodden.

Even if each person donates Rs.2,000/- per annum and 5% of the population, out of 110 crores, donate such an amount to NDF the annual amount that would be deposited in the NDF would be10,000 crores which is more than sufficient for buying electronic gadgets including radars and other jamming equipment. In fact, with this much amount available, from NDF, we can even procure more Aircrafts that have AWACS (Airborne Early Warning and Control System). Though AWACS has been discussed for the 2 decades only recently parleys have started with Israel. The present day reality is that future wars belong to those who have an upper hand in electronic warfare. Further, the fact that both our neighbors have nuclear weapons forces us to prepare ourselves for theatre warfare and naturally this includes a missile shield. Though we have tested Prithvi as an anti-ballistic missile we are still at infancy with regard to anti-ballistic missile systems. It is very unfortunate that we have very unpredictable neighbors and we had bitter experience with them already. In the past arms procurement always started only when the neighboring countries invaded India. Should we continue the same trend? Would it not be prudent to anticipate the threats and purchase the equipment accordingly? In the west all the people are wary of defence related matters, foreign policy, international relations, etc. Unfortunately majority of the population in India is still illiterate and hence it is beyond their reach to think about national security. That leaves middle and upper class to think about these issues. Here again, these two classes are completely immersed with domestic problems at home or in the office or in business and they do not have time or orientation to think about the national security. Hence we have to find ways to integrate our populace into the problems of national security and create awareness among the general public through electronic and print media and debates at various fora.

Before independence, if there was a single issue, which has united the Indian population, it can be said to be the desire to get freedom from British raj. We have not witnessed such coming together after independence. National security should be one of the issues, which should bring people from all sections of the society, and NDF can become a unifying factor to unite all Indians. If we think that only those people live in the border states should worry about national security is equal to having a myopic view. We should overcome this kind of mentality and everyone should participate in the national security. We should remember that any lapse in security of the nation would have Pan-Indian affect.

NDF is an option for all Indians to rise above regional, religious, linguistic chauvinisms, for those who go astray into naxalism, militantism or people who have ideological dogmatism and partisan politics. While the men in uniform defend our country on the borders those who contribute to NDF can become the unsung heroes and a unifying factor to sink our differences.

Once we make the NDF more successful we can constitute a National Science and Technology Fund (NSTF), National Infrastructure Fund (NIF), National Agricultural Fund (NAF) and National Sports Fund (NSF) or funds under these heads may be constituted simultaneously. Though it is out of the purview of the present article to go into details of these Funds it is suffice to briefly mention that the amount accumulated in the National Science Technology Fund can be used to install several Regional Sophisticated Instrumentation Centers that would have the state-of-the-art research equipment for advanced scientific research. In fact under this fund sophisticated medical equipment can be purchased and supplied to remotest government hospitals where poor cannot afford the expenses that are billed by private hospitals. Similarly the amount collected under National Infrastructure Fund (NIF) may be (i) utilized for laying cement roads wherever possible in addition to tar roads, (ii) gauge conversion and new rail links that connect remotest places in India and (iii) telecommunication facilities to remotest areas. The money in the National Agricultural Fund may be utilized exclusively for water catchments, irrigation, and providing infrastructure in the form of agricultural gadgets including soil analyses kits and forecast of monsoons. In the case of National Sports Fund the money may be utilized to encourage all other sports but not cricket. This is for 2 reasons. Number one our cricketers are already flooded with excess money from various sponsoring agencies and the other reason is that while cricket has received lot of attention the same is not the case with other sports. This is notwithstanding the fact that, in recent times, we are witnessing dismal performance by our cricketers who have shown successful failures. In Olympics for more than 3 or 4 decades India’s name is missing in the medals tally. This is an aspect for introspection for every citizen of this country. We should find a solution for this and not just remain as mute spectators.

The money received in all above proposed schemes and the expenditure incurred should be well audited and should be accessible to public to avoid any misgivings in the minds of donors and the general public. The modalities of tax benefits to the donors may be worked out by the concerned departments.