When the military pension rate rises again, it will be harder to afford health care
In a move that will be hard for the military to afford, the Defence Ministry will increase the pension rate for active personnel from Rs 20,000 to Rs 30,000 by July 1, 2018.
This will mean the military will have to pay a huge premium for health care, which will cost the government billions of rupees every year.
It is a move to pay back the military for past losses incurred in the war with the Maoist insurgency.
A senior government official said the decision will not affect the pension of army officers and senior officials.
The decision was taken to make sure the pension rates for retired service personnel are affordable, he said.
The Government has been keen to lower the pension age, as this will reduce the burden of health care costs on the government.
The government is also keen to ensure the retirement age for personnel is lowered to 67 by the end of this fiscal.
In the next two years, the retirement ages will be lowered to 65 and 66.
The Defence Ministry is also mulling raising the retirementage of other senior government officials, including senior civil servants, senior bureaucrats and senior doctors.