The federal government has increased the defense budget for the outgoing fiscal year by 6 percent to over Rs1.45 trillion in the view to meet the needs of the armed forces, including their enhanced salary requirements. The decision to increase the defence budget by another Rs80 billion was taken by the Economic Coordination Committee (ECC) of the Cabinet in total approved Rs182 billion in supplementary grants.
Read more: Rs 920 billion: Why has Pakistan increased the defense budget?
The Ministry of Defence had demanded an additional Rs80 billion defence budget for “critical shortfalls” in addition to making adjustments in the budget for spending on the Jinnah Naval Base, the Naval Base Turbat, and the multi-functional office building in the headquarters. Finance Minister Miftah Ismail presided over the ECC meeting that approved an Rs80 billion supplementary budget for the armed forces or to the extent of the actual additional expenditures being incurred. The finance ministry was of the view that the additional spending in the fiscal year 2021-22 ending on June 30 will be less than Rs80 billion. For the outgoing fiscal year, the National Assembly had last year approved an Rs1.373 trillion defence budget. With the rise in the spending ceiling, the next fiscal year’s defence budget may also now be higher than the earlier estimated figure of over Rs1.55 trillion.
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In total, the Ministry of Defence got Rs153 billion or 11.8 percent additional money in this fiscal year over the revised budget of the previous year, which is equal to the average inflation rate in Pakistan. The defence spending will be equal to 2.2 percent of the Gross Domestic Product, excluding expenditures on the armed forces development program.
It is to be reminded that in July last year, the previous government had given a 15 percent special allowance of the running basic pay to all the ranks of the armed forces, which jacked up the army budget requirements by another Rs38 billion per annum.