The Pulse

Pakistan Ups its Defense Spending

Pakistan Ups its Defense Spending
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On Friday, Pakistan unveiled its new defense budget for the next fiscal year. The budget stands at 780 billion rupees—approximately $7.7 billion—for Pakistan’s “Defense Affairs and Services,” marking an 11 percent increase over last year’s spending. The increase is roughly in line with Pakistan’s year-on-year defense budget increases, which amount to roughly 3.5 percent of its GDP.

The Pakistani finance minister, Ishaq Dar, made the announcement in the country’s parliament that 780 billion rupees had been allocated for defense spending through next year. “The defense budget is being increased from the 700 billion rupees [approximately $6.87 billion] for 2014-15 to 780 billion rupees for 2015-15, which is an increase of about 11 percent,” he remarked.

Pakistan’s current level of military spending and next fiscal year budget have been framed within the context of its rivalry with India, which maintains conventional military superiority, and in terms of the needs of Operation Zarb-e-Azb, the Pakistani military’s ongoing campaign against extremist militant groups within the country.

Dar evoked Zarb-e-Azb during his speech to parliament: “Our country has rendered enormous sacrifices in both blood and treasure in fighting terrorism. Yet this is a menace that requires a long-term effort to eradicate. The operation Zarb-e-Azb had been initiated with a steely resolve to uproot this peril for good,” he noted.

Additionally, the finance minister announced the creation of a Special Development Program (SDP) of 100 billion rupees (approximately $981 million). “These events have established the need for further reinforcement in country’s internal defenses with objectives of protecting the areas from where the terrorists have been evicted, rehabilitating the displaced persons allowing them to honorably restart their lives,” Dar noted, highlighting the rationale for the SDP.

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According to the Associated Press, Dar additionally noted that Pakistan will received $1.509 billion in defense services from the United States—”payment from the United States’ coalition support fund for coalition forces in Afghanistan who are using Pakistani territory for logistic support.”

The budgetary increase is rather unsurprising given the immense expenses associated with Zarb-e-Azb and Pakistan’s continuing military expansion in order to keep up with India. The numbers quoted by the defense minister before Parliament are also somewhat misleading. Pakistan’s nuclear weapons program, for example, pulls funds from the budget allocation for the Pakistan Atomic Energy Commisison (PAEC)—that budget has actually been reduced from 59.3 billion rupees ($582 million) to 30.4 billion rupees ($298 million), according to Defense News.

As a result, Pakistan’s actual defense spending is obfuscated by a range of factors and is expected to be higher than what is reported in the official budgets. Some reports note that Pakistan, which with a tax-to-GDP ratio of 9.5 percent comes in at among the lowest in the world, is expected to spend up to 26 percent of its tax receipts in fiscal year 2015-2016 on defense “in some form or another.”