Three years ago, the all-powerful politburo of China’s Communist Party established a Central Commission for Integrated Military and Civilian Development. No less than the party’s general secretary, President Xi Jinping, is its chairman.

The commission’s task is to ensure that China’s industrial development is wedded to its military objectives – dual use manufacture, or what the politburo called “integrated” civilian and military production.

India’s finance minister, Nirmala Sitharaman, who has earlier been defence minister, would have done well to take a leaf out of China’s playbook while designing this year’s national budget. Incentives, if not also mechanisms, to marry industrial development to the country’s military requirements could have been introduced.

Both urgently need revving up.

Paltry defence outlay

A real military-industrial complex is no doubt a tall order, given the unsatisfactory state of both India’s military production and its overall manufacturing sector. But synergies and streamlined policies could be usefully deployed in straitened economic times.

It would have been encouraging to have at least got a hint in this budget that the government is alive to the alarming problem on both, potentially synergistic, fronts, even if it hasn’t quite sorted out the solutions. At least, a beginning could have been signalled.

Instead, Sitharaman did not even utter the word “defence”. In spite of alarming gaps in the hardware requirements of each of India’s armed services, the marginal increase that the budget papers showed barely accounted for inflation.

In fact, the allocation for the Air Force is lower than last year’s revised estimate. This when the force is down to about two-thirds of its sanctioned 42 squadrons. After embarrassing insufficiencies of various sorts were exposed the day after the air force skillfully hit targets in Pakistan’s Balakot last February, this is simply unacceptable.

Path to world power

India may not choose to emulate China’s decision to marry its industrial development with its military objectives, but it must at least seriously consider what China is doing.

It’s not as if China came up with the idea. The United States and Germany went further, and much earlier. Both those countries broke out of deep depression by aggressively investing in industrial production (along with infrastructure) during the 1930s. And each emphasised manufacture geared for the military dominance that it sought. The Soviet Union and Japan too deliberately stressed the production of military hardware in that phase.

The result of the second world war ensured that Germany and Japan had to opt for other kinds of manufacture thereafter, but the production of ships, airplanes, tanks, guns, rockets and other military hardware was the key to the dominance that the US and the Soviet Union achieved in their respective spheres during the Cold War.

Even such relatively pacifist countries as Switzerland, Sweden and Austria compete for a share of the global armaments markets. India, on the other hand, is among the world’s largest arms importers. Sadly, after the development of the Marut aircraft was not taken forward in the 1970s, India’s armaments production has faltered.

The serious China threat

India’s policymakers must clearly understand what George Fernandes said quite plainly when he was the defence minister two decades ago: China is India’s main security threat. It may suit certain ideological agendas to posit Pakistan as enemy number one, but the fact is that Pakistan is well on its way to becoming an adjunct of China.

Until the early years of this century, Chinese armaments were often treated with derision, but that’s rapidly changing. China recently unveiled aircraft-sized stealth fighter drones, missiles that can penetrate any Western missile defence system, unmanned submarines, and intercontinental ballistic missiles with ten warheads each that can strike the United States in half-an-hour.

The effort led by Xi to build China’s own military-industrial complex is a vital part of China’s rise as an armaments manufacturer. Pakistan, Bangladesh and Myanmar are the most prominent buyers of Chinese arms.

China’s production of military hardware is so well oiled by the huge cash reserves gained from China’s vast array of exports that it has recently outstripped the armaments production of most other countries. It is second only to the US in the amount it spends on armaments. With five per cent of the world’s arms market already in the bag, China could overtake Germany (six percent) and France (seven percent) to become the world’s third largest arms exporter.

In submarines, space technologies and cyber resources too, it is angling to become number one. If India wants to retain elbow room, leave alone join the high table, it must think creatively and nimbly.