Pak govt likely to hike defence budget by 12%

Last Updated: Tuesday, May 10, 2011 - 13:01

Islamabad: Pakistan government is
expected to hike the defence budget for the next fiscal year by 12 per cent to Rs 495 billion though the total military spending is likely to be more than Rs 767 billion, according
to a media report Tuesday.

The "stated" defence budget for 2011-12 is likely to
be Rs 495 billion, an increase of Rs 53 billion or 12 per cent
over the previous year`s "stated" budget of Rs 442 billion,
The Express Tribune newspaper quoted its sources as saying.

However, total military expenses are likely to exceed
Rs 767 billion, though not all of this amount will be paid by
Pakistani taxpayers, the report said.

While the stated outlay will be just over a quarter of
the government`s targeted tax revenues, the daily said that an
analysis of the defence allocation suggests that the "numbers
understate the full costs of military spending".

The "stated" budget for the next fiscal will have a
rate of increase that is nominally below inflation.

"This, however, masks actual defence expenditures in several ways, including transferring military pensions to civilian expenses and counting security operations separately," the report said.

The government is likely to allocate Rs 216 billion
for security purposes under several nondescript headings,
which include military operations and are paid for in part by
Coalition Support Funds received from the US and grants from
the federal government, the daily quoted Finance Ministry
sources as saying.

The Finance Ministry shies away from discussing these
grants in any detail.

In addition, the military pension bill is likely to be
included in the civilian side of the federal budget,
continuing an "accounting trick" first employed by the regime
of former military ruler Pervez Musharraf.

This move was aimed at lowering the military budget
while continuing expenses at the same levels.

For the outgoing fiscal year, the military pension
bill came to Rs 60 billion and it is likely to be higher for
the next fiscal.

Stated nominal military expenses have risen 29 per
cent over the past two fiscal years, almost exactly in line
with inflation, despite several military operations against
militants in the tribal areas and Swat district.

Independent analysts believe the military allocations
may need to be reviewed in light of the May 2 US raid on a
compound in Abbottabad that killed al-Qaeda leader Osama bin
Laden.

PTI

First Published: Tuesday, May 10, 2011 - 13:01
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