Myth number 1
Our largest expenditure item is defence. Not true. The largest expenditure item in the budget is debt-servicing. The second largest expenditure, which is deliberately hidden in budget figures, will actually be eaten up by losses of Public Sector Enterprises like PIA, the Pakistan Steel Mills, power sector and Pakistan Railways. The third largest chunk will go for the Public Sector Development Programme (federal plus provincial). And the fourth largest allocation will go towards ‘Defence Affairs and Services’.
Myth number 2
The defence budget takes away the lion’s share of the total budgetary outlay. Not true. In Budget 2018-19, ‘Defence Affairs and Services’ will consume around 18 percent of all the government expenditures. What this means is that a full 82 percent of all government expenditures are not defence related.
Myth number 3
The defence budget has been increasing at a high rate. Not true. In the financial year 2001-02, 17 years ago, the allocation for defence amounted to 4.6 percent of GDP. In 2003-04, the defence budget dropped to 3.9 percent of GDP. Budget 2018-19 has allocated Rs1.1 trillion for ‘Defence Affairs and Services’ which is 3.2 percent of our Rs34 trillion GDP.
Myth number 4
The Pakistan Army consumes almost the entire defence budget. Not true. In the 1960s, Pak Army’s budget as a percentage of our national budget had hit a high of 42 percent. In Budget 2018-19, Pak Army’s budget as a percentage of our national budget has dropped sharply, and it now amounts to 9.6 percent.
Myth number 5
Pakistan spends a very high percentage of its GDP on defence. Not true. There are at least four dozen countries that spend a higher percentage of their GDPs on defence. They include: India, Egypt, Sri Lanka, United States, United Kingdom, South Korea, France, Eritrea, Oman, Saudi Arabia, Israel, Jordan, Liberia, Brunei, Syria, Kuwait, Yemen, Angola, Singapore, Greece, Iran, Bahrain, Djibouti, Morocco, Chile, Lebanon, Russia, Colombia, Zimbabwe, Turkey, Georgia, Guinea-Bissau, Ethiopia, Namibia, Guinea, Turkmenistan, Kyrgyzstan, Algeria, Serbia and Montenegro, Armenia, Botswana, Ukraine, Uganda, Ecuador, Bulgaria, Lesotho and Sudan.
And now the two facts…
Fact number 1
The accumulated amount of the circular debt almost equates the current year’s defence allocation. And what that means is that if we can somehow manage losses within the power sector the savings will cover one year’s defence allocation.
Fact number 2
Pakistan’s armed forces are the 6th largest in the world, but our expenses per soldier are the lowest. The US spends $460,000 per soldier, Saudi Arabia $340,000, India $33,000, Egypt $18,000 and Pakistan $12,000.
By: Farrukh Saleem
The writer is a columnist based in Islamabad.
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