An IDC Analysis



New Delhi, 22 July 2004  

The British Defence Secretary stated in UK's Parliament that the defence budget was set to rise by £3.7 billion. Indicators around the world and the volume of business carried out at the Farnborough Air Show, which opened on 19 July (with USA and NASA back) –– clearly illustrate  that all countries led by USA, and including Australia, China, France, India, Israel, Malaysia and Pakistan and now UK have increased their defence budgets.

In India the UPA Government appears to have realised that defence spending was essential for long term benefits, but already doubts had appeared whether the money allocated for capital expenditure in the latest budget would be fully expended. New procurement rules for the Defence Acquisition Council were issued in June 2003 but they are cumbersome and even today the intricacies of defence spending that were exposed by the Tehelka episode, seem to remain. Recently the media reported that a non defence Minister had recommended the Russian 155mm gun in a letter to the Defence Minister!

Media had indicated that the selection for the towed and self propelled 155mm gun was short listed to Bofors of Sweden, Denel of S Africa with an outside chance for Soltam of Israel. Several trials were undertaken and Bofors, which is no longer blacklisted, appears to be the Army's choice but media indicated that the BJP Government had reached some special agreements with S Africa. So the wheels within wheels continue!

In an attempt to show the clarity of the UK’s defence outlook we post a synopsis of their Defence Budget below.

Already news is out that the Indian Navy was looking for 16 Seaking helicopters and possibly the Royal Navy may provide them as they go on to acquire the Merlin EH 101?

Finally the UK budget highlights the role of coordinated and effective intelligence.

UK's Defence Budget –– A Synopsis

(With our brief comments)

  • Defence budget set to rise by £3.7 billion –– “transform Armed Forces to deal with the challenges of the 21st Century”

  • There is a shift away from emphasis on numbers of platforms and of people to a new emphasis on effects and outcomes, and on the exploitation of the opportunities presented by new technologies and Network Enabled Capability. (Comment: the Indian army will have to look at this option as the Home Ministry can take over some of its functions. The Indian Armed Forces are all looking to Special Forces and will need to reduce manpower.)

  • The balanced Land force of the future will consist of two heavy armoured brigades, three medium weight brigades –– based around FRES and a light brigade, in addition to the Air Assault and Commando brigades

  • Three additional light armoured squadrons to be established, a Challenger 2 regiment to be re-roled into an armoured reconnaissance regiment and an AS 90 regiment re-roled into a light gun regiment. “Later, we will equip three artillery regiments with the new Light Mobile Artillery Weapon System”. Improve ability to engage land targets with precision and at range. As an important first step down this path the first Apache attack helicopter will go operational later this year.

  • Improvements in missile inventory, through introduction of Brimstone, Javelin, and precision indirect fire artillery rounds. Collectively, these improvements will be balanced by a reduction of seven Challenger 2 armoured squadrons and six AS 90 heavy artillery batteries by early 2007

  • Invest £3 bn in helicopter platforms to replace and enhance existing capability

  • Ground-based air defence to be met from 24 Rapier fire units and 84 High Velocity Missile launchers. Rapier will be deployed by the Army with the RAF Regiment relinquishing the role. Ground Based Air Defence will be commanded by a new Joint HQ within the RAF Command Structure. (Comment: India needs joint command and control too).

  • Procurement of additional missiles worth around £180m for the High Velocity Missile System.

  • The Infantry Arms Plot to be phased out

  • Reduction by a further two N Ireland battalions which will take place in the autumn. This in turn will reduce the overall requirement for Infantry battalions from 40 to 36. This reduction will comprise one battalion recruited from Scotland, and 3 recruited from England

  • The manpower released by the reduction of 4 battalions will be re-distributed across the Army, to strengthen existing infantry units, but also to be used elsewhere amongst the most heavily committed specialists such as logisticians, engineers, signallers and intelligence. The overall size of the Army will be around 102,000

  • NAVY –– Pay off our oldest Type 42 destroyers, HMS CARDIFF, NEWCASTLE and GLASGOW by the end of 2005 and three Type 23 frigates, HMS NORFOLK, MARLBOROUGH and GRAFTON by March 2006

  • Maritime reconnaissance needs will be met with 16 Nimrod MR2 aircraft. The requirement could in future be met by a fleet of around 12 more capable Nimrod MRA4 aircraft, subject to industry demonstrating satisfactory performance at acceptable prices

  • Pay-off HMS INVERNESS, BRIDPORT AND SANDOWN by April 2005.  The improved security situation in Northern Ireland also makes it possible to pay off the Northern Ireland patrol vessels, HMS BRECON, DULVERTON and COTTESMORE, by April 2007. Manpower of the naval service will reduce to 36,000 over the next four years. (Comment: Indian Navy could look at some buys from the Royal Navy.)

  • Air Force –– Reduce the number of the air defence Tornado F3 squadrons by one, and bring forward the withdrawal of two Jaguar squadrons to 2006, with the final Jaguar squadron to be disbanded in 2007. Reduce RAF manpower to around 41,000 by 2008. Close RAF Coltishall airfield by December 2006. Carry out extensive review of our future requirement for airfields.

  • Buy the current fleet of four C-17s at the conclusion of the current lease arrangement and purchase one additional aircraft

  • Maintain the effectiveness of the nuclear deterrent including making the necessary investment at AWE Aldermaston, and keep open the options for a successor to Trident until a decision is required

  • Reduce around 10,000 civilian jobs

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