Here is a letter from one of Military technologies editors about India and its defense spendings.
Its a very interesting letter if you compare it to worldwide defensebudgetcuts.

Armed but hungry, can India afford defense spending without poverty allevation?


While India is purchasing big tickets defense purchases which is estimated at 80 milliard dollars over the past 5 years , a UN backed report on global poverty places India as one of the poorest countries of the world.
According to the UNs multidimensional poverty index(MPI) the number of poor in eight Indian regions are more in number than in 26 sub Saharan countries together.
The report states 421 million people in India are among the poorests compared to 410 million in Africa.
Probably the number will even grow if the remaining 20 ( richer) regions are acounted in the number too.
What has this to do with defense spendings?
After all India needs these expensive weapons to protect its military might as a rising economic power of the 21st century.
To comnbat terrorisme, modernise its armed forces and lots of other reasons, advanced by proponents of speedier and expensive defence procurement.
But, with such a high percentage of 1,2 billion people living on the fringes of the survival sweepstakes the government has a lot to do.
It needs to do this by prioritising budgetetary spending in favour of creating conditions for economic development, rather than allowing a vast section of its population to remain in the grip of poverty.
Some of the spending for defense, like the 10 billion dollar sum for 126 new fighter aircraft, can create housing, provide helathcare, develop local infrastructure and finance jobschemes for the poor of an entire region (50 million people)
The global turmoil of 2009 had a great impact on the military budgets of western nations.
In a way economic well being and defense spending are inexorably linked in the west, with lower economical growth being met with budgetcuts on military expenditure.
In India it has been different, New Delhi embarked on a massive modernisation programme of all its military forces after the 1999 Kargil conflict.
Regardless of the economic situation the past 10 years defense spending has been steadily increasing.
The global recession of 2009 which affected India as much as it did on other nations and poor monsoons during the past 4 years which reduced agricultural productivity, in a country where 70% of the population is involved in agriculture, has not deterred the Indian government from accelerating defense spending.
In fact during fiscal year 2011/2012 India will spend another 32 billion dollars on new weapons.
Perhaps it is time to take stock of what the mega defense spending since 1999 has achieved.
Did it make India stronger, more secure and less prone to terrorist attacks?
A mid term review is called, to understand how the modernisation and procurement drive has helped the country achieve its stated objectives.
What should worry Indian planners is that 10 years ago the number of poor in India was variously estimated at around 300 million.
The 50% raise in poor should ring the alarmbells for the Indian government.
An increas in the number of poor has its own problems.
The Maoist insurgency in parts of India ( Naxalite movement) is attributed to the Maoists exploiting the poor and turning them into armed cadres intent on overthrowing the government.
Mass migration in cities in search of jobs, human trafficing and an increase in crimes and some other problems.
If you get the impressian that India is a poor country living beyond its means , spending on defense where it shoulb be feeding its poor, may well learn that India has traditionally earmarked a good amount of bugettary funds for social schems and education.
However in the context of 421 million people living in poverty this might seem to be insufficient.
A growth of industrial and services industry provided more weath for the upper and middle classes in India.
India has very little defense industry of its own, with the bulk of the platforms systems and attendant equipment being paid for in hard currency.
India has a bussiness opportunity  here to leverage its industrul and technological talent to devlop its own defense industry.
However as everybody knows the learning curve is very steep, combined with international vendors and jealousy guarding technology and manufacturing knowhow, it will not be easy for Indian companies to get into the defense equipment manufacturing game.
The Indian government is aware of that situation.
In 2006 it had set in motion the defense procurement procedure a series of guidelines provinding for offsets procuring from home-grown companies and from international vendors.
However the DDP has changed over the years after both India and Intern vendors complained that the policy lacked in some areas.
The latest version of the DDP is awaited, which many industrial executives believe will be more bussiness friendly than earlier versions.
A (bad) example of this is a non defense factory like Coca Cola which was allowed to build a factory in a desert in a poor region where people hardly have water to survive, the factory uses 1,5 liter of the already scarce water to make a 30cc bottle of Coca Cola.
Just imagine what such a policy could do with defense industry, how will issues like environment be handled?

SOme joint ventures have taken off in India with an eye on immediate procurement of artillery guns, aircraft and other items.
In addition to the DDP India needs laws and an investment policy which specifically allows the creation of an indegenious defense industry that is several times the size of what it is now.
Until than India will have to find a way to balance its defense spending with the goals of economical development, so that its hard currency spending is not at the cost of the basic duty of the Indian state, to provide a stable environment for economic development to the most deprived sections of society.

Source: Military Technology

You see, this always gets me.  India needs to address the poverty issues it has before putting even more money into military. 

What strikes me even more is that our army's budget has been cut with 300 million euros for the coming year.
While we give India for 194 million support, its a crazy world we live in :(

have you read about Greece's armour buyings from the last years and the following years?
I have an article laying somewhere around, it's disguisting when you see the state Greece is in.... and the effects Greece creates/created around the Globe  hdbng

Yes I know, and its not only Greece.
The same applies to Pakistan.
Look how many people died during the floodings, aid must come from the western countries.
Pakistan spends 4 times more money on defense than my government does.
Look at Saudia Arabia, buying for over 80 milliard dollars of weapons, they did not give a dime to the Pakistani victims.
Well the list is very long look at the newsflash, more worrying though is that we ( NATO) are cutting defence budgets whereas third and second world countries are arming themselves to the teath very rapidly.

None of your examples can even come close to the obscene defense spending my country commits to the detriment of the world.

How sad it may look Jody, the US is commiting its share to NATO, a little bit more but hey they make their target :)
My country cant even support NATO the way they have to due to the budgetcuts.

Maybe so, but not it's commitments to it's own citizens.

FacMan, I read a complete report on the US and the ending was something like: "the US is becoming rapidly a 3rd world country", based on the difference between poor and rich, the %'s poor-rich, the lack of healtcare, economics and much more.... sad to read...

Yes, it is a sad statement of the state of my country when there are millions of children (never mind adults) without basic healthcare. We shall surely pay more for their care when they become seriously ill, though preventive care would come at a fraction of the cost. We lose our greatness beause we ignore the weaker members of our society. And though the christians tout their ability to provide for those in need, rather than have the Govt do it, they fall woefully short and the people suffer for it. We simply must carefully re-examine the expenditures for militarial/industrial complex, as Pres. Eisenhower warned, or suffer the consequences we now see appearing.

We spend more on our defense budget than the rest of the world combined.

I know its difficult, but with China, Iran, India  expanding their military might our democracies can face wars in the upcoming 10 or 20 years.
And you know what the Romans said, its better to prepare for war when its still peace.
Imagine what these countries can do to block important trade routes, and what economic effects that might cause.....

 We can interdict trade routes just as well, if not better, than any country in the world, so that does not bother me. Of the 3 mentioned states, India & China would face severe disruptions to their own economies and make starting a fight cost inneffective.

Iran on the other hand, with its economic isolation (as it is), could expect little impact on their economy and can only impact other's trade routes in one location. I doubt they have the staying power to maintain a blockade for very long. Not to mention, if they block the straits of Hormuz, damn near the entire planet will be at their throats faster than you can say Ramadan.

Im tired of bearing the brunt of the free worlds policing policies. Time for the rest of the free world to spend their share of blood and treasure helping maintain and spread democracy. If you dont want to help, then you deal with your problems alone.

To be hounoust I share your thoughts...but here people want to cut the defense budget even further, same goes for Germany.
The UK has even promised to fire 10 thousands of men and cut the budget with at least 20% or so.
Nothing will change untill its to late again, in some countries you can compare the state of the army with 1939.

If the Russians want they can be in Rotterdam within a few hours.

I'll bet they're counting on the US umbrella to protect them. I'm not for deploying our troops to protect those who wont protect themselves, and the rest of the world would be well served to pay attention to the fact that I am not alone in America. Isolationist some would say, but thats ok, I'd rather that, than the bleeding of a thousand cuts we suffer from now. Time for us to stop being the planetary police force.

I know, and I dont like the way we are going either.
But its something which I cant do anything about :(

I think you need a good trained and well equiped armed forces to defend your country and interests and guard over the safety and security of your inhabitants.
Unfortunately (left wing sentiments grow) police and military are confronted with budget cuts for 10 years now.
An army and the security they provide cant be measured in money so the army is always the first who will suffer from cuts when economically its going bad.

Untill the situation is changing and suddenly foreign powers are threathening us.
This happened in 1939, the Dutch army was bad equiped, nonetheless in many areas put up a tough fight against the Germans, in some cases even scoring victories.
Shooting down 25% of the German airforce and a lot of their transport planes, retaking 2 of 3 airfields with untrained conscripts, taking prisoner of almost an entire force of paratroopers.
Left winged politicians were responsable for this badly equiped army, after the war they tried to picture the(often) brave men as losers who coudnt do anything to stop the Germans.
Now in 2010 the situation is about the same, fortunately nobody has plans to attack us ( I hope)