India's Defense Budget World's 3rd Largest Despite High Poverty

[Riaz Haq]

In 2016, India surpassed Saudi Arabia and Russia to claim the 4th spot among the top five defense spenders globally for the first time, according to Jane's Defense.  India, a country with 33% of the world's poor, is projected to surpass the United Kingdom to rise to the 3rd spot for defense spending by 2018.

Sources: FT/IHS Jane's (Defense Budgets) and World Bank (Poverty)

India's military spending has grown rapidly from $38.17 billion in 2010 to $50.7 billion in 2016. It is projected to rise further to $56.5 billion in 2018 and $64.07 billion in 2020, according to Jane's.  For comparison, India's south Asian neighbor Pakistan's defense budget for 2016 is only $8 billion.

India's rapid rise to the list of world's top defense spenders stands in sharp contrast to the reality that it remains home to the world's largest population of poor, hungry and illiterate citizens. India also leads the world for lack of hygiene, disease burdens and open defecation.

Prime Minister Narendra Modi's rule has seen dramatic growth of wealth inequality in India. Top 1% of Indians now own 58.4% of India's wealth, up from 49% in 2014 when Mr. Modi was elected Prime Minister, according to Credit Suisse Global Wealth Report 2016.

Median wealth data compiled by Credit Suisse for 2016 shows that average Pakistani adult is 20% richer than an average Indian adult and the median wealth of a Pakistani adult is 120% higher than that of his or her Indian counterpart, according to Credit Suisse Wealth Report 2016. Average household wealth in Pakistan has grown 2.1% while it has declined 0.8% in India since the end of last year.

CS Wealth Report 2016 indicates that 50% of Pakistanis own more than $1,180 per adult which is 120% more than the $608 per adult owned by 50% of Indians.

The Credit-Suisse report says that the richest 1% of Indians own 58.4% of India's wealth, second only to Russia's at 74.5%. That makes India the 2nd biggest oligarchy in the world.

The CS wealth data, particularly the median wealth figures,  clearly show that Pakistan has much lower levels of inequality than India.

Share of World's Poor Population By Countries  Source: Our World in...

Oxford Poverty and Human Development Initiative (OPHI)'s MPI, multi-dimensional poverty index, brings together 10 indicators, with equal weighting for education, health and living standards. In South Asia region, Afghanistan has the highest level of destitution at 38%, according to OPHI's MPI index. This is followed by India at 28.5%. Bangladesh (17.2%) and Pakistan (20.7%) have much lower levels.

Rapid growth in India's defense expenditures conveys Prime Minister Modi's priorities. It seems that he believes the way for India to achieve great power status is through building a massive military regardless of the deep deprivations of the Indian people.

Mr. Modi's massive military buildup poses a serious threat to India's neighbors, particularly Pakistan, a much smaller country which was invaded and split in two by the Indian military in 1971.  The Indian invasion resulted in the creation of Bangladesh.

Related Links:

Haq's Musings

Credit Suisse Global Wealth Report 2016

India Massive Military Buildup

Modi's Israel Envy

India Home to World's Largest Population of Poor, Hungry & ...

India Leads the World in Open Defecation

MPI Captures Depth of Deprivation in India

[Riaz Haq]

Christopher Clary
@clary_co
A bit of a tour d'horizon of India-Israel Aerospece Industries cooperation in the Indian Express the other day. "The reporter was in Israel at the invitation of the Embassy of Israel in New Delhi." A few highlights. /1

https://twitter.com/clary_co/status/1595067490694045697?s=20&t=...
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From UAVs to refuellers: How Israel is helping India keep an eye on LAC
These days, Avi Bleser, vice-president of marketing for India at Israel Aerospace Industries (IAI), says he is working closely with the Indian Army and Indian Air Force to tailor solutions for their defence needs.

https://indianexpress.com/article/india/from-uavs-to-refuellers-how...

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Christopher Clary
@clary_co
IAI is working closely with India on "the induction of Heron MK II, a state-of-the-art UAV that can fly at a height of 35,000 feet, cover a radius of 1000 km, see through dense clouds, work in bad weather & fly for 45 hours. It’s learnt that MK IIs are being deployed in Leh." /2

https://twitter.com/clary_co/status/1595067492157849600?s=20&t=...

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Christopher Clary
@clary_co
"Last year, the Indian Army had also taken on lease Heron TPs, a Medium Altitude Long Endurance (MALE) Unmanned Aerial System (UAS) for all-weather missions, from IAI. Heron TP drones are one of the two drones made in Israel that can be armed, if needed." /3

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Christopher Clary
@clary_co
"The IAI and Hindustan Aeronautics Limited (HAL) have signed a joint venture whereby IAI will not only offer UAVs to India, but also help HAL in manufacturing them in India." /4


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Christopher Clary
@clary_co
"Earlier this year, HAL signed [an MoU] with IAI to convert civil passenger aircraft into a multi-mission tanker transport for air refuelling with cargo & transport capabilities. The MoU also covers conversion of passenger planes into freighter aircraft." /end