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Defence budget: Rs1.33trn to be allocated in FY2021-22

ISLAMABAD: Total defence allocation for next fiscal year (2021-22) would be 17 percent of the total budget and 2.6 percent of GDP, well informed sources in the Defence Ministry told Business Recorder.

In 2020-21, Rs1289 billion was budgeted for defence out of a total outlay of Rs7294 billion which is 17.67 percent of the total outlay – an amount which includes salaries, operating expenses, civil works, physical assets and defence administration but not military pensions.

Sources further revealed that in the next budget salaries would be raised by 20 to 25 percent. In 2020-21 total employees related expenses (defence) were Rs475.6 billion and a 25 percent rise would imply an additional nearly Rs119 billion. In 2020-21 salaries/pensions of civilian and military personnel were frozen in an attempt to contain the deficit.

The rise in defence budget, sources further stated will be nominal – less than three percent [projected] – in the forthcoming budget 2021-22 compared to the outgoing year.

Sources in defence ministry told this correspondent that the defence budget is estimated to be Rs1.33 trillion in 2021-22 against Rs1.29 trillion in 2020-21. Revised estimates for 2020-21 will be released in the budget documents for 2021-22 however defence budget has never been slashed to contain the budget deficit.

Informed sources further told this correspondent that there are serious concerns in Pakistan that the scheduled NATO and US troop withdrawal from Afghanistan this year may fuel attacks from Afghanistan which may require a significant increase in operational expenses of the military.

The next round of intra-Afghan talks, according to sources, is expected to be held soon but an immediate breakthrough is unlikely with regard to the restoration of peace and stability in Afghanistan as prospects of reconciliation between the Taliban and Afghan government appear dim.

“We have been calling for an ‘orderly’ and ‘responsible’ troop withdrawal from Afghanistan, leaving no security vacuum that could be exploited by spoilers,” a senior Pakistani diplomat said, adding that Pakistan could be the direct victim of continued chaos in Afghanistan.

The official said that Pakistan is particularly concerned about the presence of hostile elements such as outlawed Tehreek-e-Taliban Pakistan (TTP), Jamat-ul-Ahrar (JuA), Daish and other terror outfits believed to be hiding across the border with support from Indian RAW.

He said that the withdrawal of US forces should coincide with the overall progress achieved in the peace process, adding that relevant Pakistani authorities are in contact with all relevant stakeholders. “We believe that all parties to the Afghan conflict must remain committed to the ongoing efforts for a negotiated settlement of the conflict,” the diplomat emphasised.

Copyright Business Recorder, 2021

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