India at No. 5 — The SIPRI Report and the Missing Defence Accountability Framework

The Editorial Argument

India is now the world’s 5th largest military spender at $92.1 billion (2025, SIPRI data). That is more than $250 million per day. The question the SIPRI data raises is not whether India should spend on defence — it should, and the threat environment justifies it — but whether the institutional architecture for accountability, oversight, and efficiency in defence spending is commensurate with the scale of investment.

The honest answer is that it is not.

Three Accountability Gaps

1. Parliamentary Oversight Is Structurally Weak

India’s Parliament Standing Committee on Defence does not have access to classified procurement files. It can examine the general defence budget, call witnesses, and write reports — but the most consequential decisions in Indian defence (MRFA fighter procurement, submarine contracts, missile programme budgets) are shielded from parliamentary scrutiny under secrecy classifications.

Compare: the US Senate Armed Services Committee and US House Armed Services Committee have classified briefings, unannounced facility visits, and the authority to subpoena witnesses — including serving generals. The UK’s House of Commons Defence Select Committee publishes classified annexes to public reports and has access to procurement files under Parliamentary privilege. India’s parliamentary oversight is weaker than any other democracy with comparable defence spending.

2. The CAG’s Limited Access

The Comptroller and Auditor General (CAG) — India’s supreme audit institution under Article 148 — audits public finances including defence. However:

• CAG audits are retrospective (after funds are spent)
• Secret items in the defence budget (estimated 10-15% of defence capital budget) are not subject to public CAG reports
• The Canteen Stores Department, DRDO’s commercial ventures, and ordnance factories (now converted to corporations — 7 DPSUs + 16 OFB units converted to DPSU) have audit exemptions or significant delays

The result: India’s $92 billion annual defence spend has a weaker public audit trail than its health or education budget.

3. No Statutory Defence Acquisition Authority

Major democracies manage defence procurement through independent statutory bodies:

• US: DARPA (research) + USD(AT&L) (acquisition) + separate programme offices with independent oversight
• UK: Defence Equipment and Support (DE&S) — a bespoke government body with private-sector management tools
• India: Defence Acquisition Council (DAC) — chaired by the Defence Minister; DPP/DAP process — but the entire framework is executive-controlled with no statutory independence

The absence of statutory independence means procurement decisions are vulnerable to political pressure, bureaucratic inertia, and vendor relationships that prioritise rent-seeking over operational capability.

The Specific Risk: AtmaNirbhar Defence

India’s AtmaNirbhar Bharat defence programme has produced genuine achievements — the Positive Indigenisation Lists, the growth of private defence manufacturing, HAL’s Tejas and Dhruv production ramp-up. The test of indigenisation, however, is not the number of items on a list but whether the domestically produced equipment meets operational requirements at competitive cost.

The armoured vehicle programme (FRCV — Future Ready Combat Vehicle), light machine gun procurement (15 years of delays), and basic soldier kit procurement have all been plagued by cost overruns, specification changes, and vendor disputes. The Parliamentary Standing Committee has repeatedly flagged these delays. Without independent procurement oversight, the AtmaNirbhar programme risks becoming a vehicle for domestic monopolists rather than genuinely capable indigenous defence industry.

What Is Needed

1. Parliamentary access to classified procurement. A reformed Standing Committee on Defence with security-cleared members and access to major contract files — on the model of US/UK/France.

2. A statutory defence acquisition authority. An independent body (separate from MoD bureaucracy) with professional procurement staff, conflict-of-interest rules, and public reporting obligations.

3. Real-time CAG oversight of capital expenditure. Secret budget items should still be audited — just by a classified division of CAG, with reports to the Standing Committee rather than public release.

4. Capability-based budgeting. Move from input-based (how much was spent on X) to output-based (what capability was achieved relative to cost).

UPSC Relevance

Mains Keywords: SIPRI Military Expenditure Report, Parliamentary Standing Committee on Defence, CAG (Article 148), Defence Acquisition Council (DAC), Defence Acquisition Procedure (DAP) 2020, AtmaNirbhar Bharat defence, Positive Indigenisation List, DPSU (Defence Public Sector Undertaking), DRDO, HAL, accountability framework, capability-based budgeting

Prelims Facts Corner