The Production of Modern Weapon Systems

Especially remarkable in this regard is the country with by far the largest number of the poorest people in the world -- India. With its one-million-man armed forces complemented by another 800,000 police and para-military forces, India occupies a proud fourth place in military manpower behind the United States, the Soviet Union, and China. In terms of military expenditures, India occupied fourteenth place in the world in 1973, second after Israel in the Third World (this was before Iran and Saudi Arabia vastly increased military expenditures following the oil price increases). If some 240,000 civilians employed by the armed forces and 200,000 workers employed in the Indian armaments industry and ordnance are added in, the number of Indian workers directly dependent on the military apparatus is of the order of 2,240,000 -- nearly half the 5,100,000 workers engaged in manufacturing, excluding mining and energy. India's direct military defense expenditures, excluding nuclear, missile, and some other development expenditures, consumes about 3.7 percent of GNP, compared with an average of 2.1 percent for Latin America and 2.2 percent for Africa, regions that are known for their military establishments. The 16.5 percent annual growth rate of Indian military spending between 1961 and 1971 exceeded the average growth rate of 12 percent in the Third World and was higher than that of nearly all North and Latin American and European countries and China. Thus after increasing by about 65 percent during the 1950s, Indian military expenditures multiplied about five times during the decade of the 1960s and nearly doubled again in the first half of the 1970s. Not surprisingly, military expenditures shot up during the Sino-Indian border conflict of 1961-1962, and again during the Indo-Pakistani War of 19711972, but declined during the first Indo-Pakistani conflict of 1965, which was quickly settled. Significantly, these expenditures show a striking and consistent correlation with periods of economic crisis -- in 1961-1962, and again for the whole period since 1967! It is reasonable to suspect that the Sino-Indian War -- whose initiation by India has been proved beyond any legitimate doubt -- and the second Indo-Pakistani War, as well as related military expenditures, were provoked by and for economic-political reasons. However that may be, when "development" was the aim of the nation, the Central government was able to raise the revenue ratio of taxes to GNP by 1.5 per cent in a whole decade. But then, when "defence" was called for, the government was able to achieve a similar percentage in a matter of two years -- from 6.4 percent in 1961-62 to 7.9 per cent in 1963-64. . . . The ratio declined again] and then there was a war and we raised our revenue ratio again to 7.7 percent. What this suggests is that in the sixties we have needed wars to motivate us to undertake substantial revenue efforts -- as if development was not a serious aim to make tax efforts for!