The Seventh Central Pay Commission (SPC) has submitted its report to the government recently. The repercussions of the report are now being felt on government finances. The Railways have, as per reports, requested the finance ministry to bear the additional cost arising out of recommendations of SPC. Similarly, there are reports that the Budget will need adjustments to accommodate recommendations of the SPC.

The elite Indian defence forces (EIDF), consisting of the Army, Air Force and Navy, explicitly continues to be unsatisfied with the SPC recommendations. The Army has some genuine grievances which can be fixed without substantial fiscal implications. The disciplined soldiers of Indian defence forces have exhibited exemplary courage in defending our borders.

In addition, in times of every national calamity, they have also excelled in civilian duties. The defence forces in India, are also an example of national integration, to be emulated by others.

Status issues

It is important that soldiers and officers of EIDF enjoy a special status among defence forces, the way the Indian Administrative Service continues to enjoy supreme status, in comparison to other civil services. If India has to emerge as a global super power, it will need fighting-fit EIDF.

Interestingly, some of the grouses of EIDF are easily addressable and seem minor in terms of costs to the government. The US defence budget is more than 4 per cent of their GDP while that of India is less than 2 per cent of the GDP. It is acknowledged by SPC that the army is short by nearly 22 per cent of officers, which amounts to substantial savings in the Budget.

Similarly, the Air Force and Navy are also short of officers. Officers account for less than 5 per cent of defence personnel, and curtailing their food allowance in those times when they are not in hardship postings would not lead to any significant savings in the fiscal deficit. Rather it would only create hardship for officers when they are undertaking war training for months together, away from family.

In such war-like locations, ensuring private food supply to such officers would probably imply higher costs than savings in curtailing food allowance.

Giving the due

Similarly, it needs to be recognised that promotion avenues at senior level are very few in EIDF. A large number of officers stagnate at different levels in the Army and many of them get superseded, not because of incompetence but medical reasons arising from harsh border conditions.

Therefore, compensation and allowances for stagnating solders should factor such extreme conditions to ensure that they stay motivated. Also disability pension of the solders needs to be related to the nature of the disability rather than be a fixed amount.

The reward system of the British Army needs to be closely examined. Indian soldiers were happily fighting for the British in alien lands. The award of land and handsome pension attracted many a youth to a career in defence services. This is in sharp contrast to the present situation where EIDF, despite so-called lucrative compensation, are short of officers.

Hence, curtailment of salaries, pension, and allowances for EIDF may not be a correct strategy to correct the fiscal deficit. The need is to ensure that soldiers are secure, so that they can focus on safeguarding our borders.

The writer is RBI Chair professor, IIM-B. The views are personal.

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