Global Defence Spending: Trends for South Asia

Just how big is the U.S. military budget compared to other countries? | MCC Washington Memo

by Rajesh Kumar Sinha  9 October 2020

The Stockholm-based International Peace Research Institute (SIPRI) recently came out with some interesting facts and figures. While SIPRI is well-known for its detailed and factual analysis on various issues concerning global peace and security, including weapon and armament procurement, purchase and exports by countries around the world, they also give an important insight into the prevailing security scenario, evolving trends, and likely developments that policymakers take into consideration while coming up with their own decision-making.

For the year 2019, the global military expenditure at $1917 billion, saw a spike of 3.6% growth as compared to the previous year’s spending in 2018. It was the highest growth in terms of percentage in a decade. At the same time, it cornered a substantial 2.2% of the total GDP of the world for the same year.

Another significant feature of the report indicates that for the first time, the top three military spenders of the world includes two from Asia, the big two, China, and India. Also, with Saudi Arabia being the fifth top military spender, Asia has emerged as the major region of military focus. While the United States continues to remain the biggest military spender in the world and lead others by miles, it is interesting that for the first time in history, India has emerged as among the top three nations in terms of military expenditure.

Out of the total global military expenditure, the US with a staggering $732 billion, records a rise of 5.3% vis-à-vis it’s military spending in 2018. That can be due to what analysts attribute to an enhanced level of global security competition, if not threat, perceived by it from both Russia and China. The belligerent Chinese behaviour against its smaller neighbours in and around south-east Asia and the South China Sea, including Taiwan has compelled the US to enhance its naval manoeuvring in the region. Further, it continues to be in some of the major hotspots around the world on account of political disputes or threats from terrorist groups, Iraq, Afghanistan, the middle east, the South China Sea, and so on.

And finally, the very idea of maintaining its leadership position in global politics and economy, the US realise that it needs to spend billions in not only making new weapons but also investing heavily in R&D so that new missiles, fighter jets, tanks, and military systems are in place for not only its own national security but also for its allies in western Europe, Japan, Taiwan, South Korea, and other places. Not to forget, that will further boost its ability to sell and export armaments to most countries in the world, gaining not only financially but also politically and strategically in those countries.

After the US, China gets the second spot in terms of military expenditure in 2019. With a 5.1% hike in defence spending as against the previous year, it reportedly spent $261 billion on military procurement. The Chinese big push can be analysed in terms of its desperate bid to outplay Russia and emerge as a serious contender to the US in terms of military might. That is reflective in its increasingly hostile behaviour against its smaller neighbours, especially in South-east Asia, and bullying of African and smaller Asian nations. Its belligerent actions in South China Sea and Indo-Pacific Ocean is part of its two-seas strategy where it wants to not only enhance but dominate the two seas and confront India, in its own backyard.

While China intends to compete and at some point in time in the future even confront the US, in the Asian region and its neighbourhood it is India that is being fathomed in Chinese strategic thinking. While trying to use India as a huge market for its goods and maintaining a functional, working relationship, its Pearl of Strings strategy, aims at encirclement of India through its neighbours and ensuring that the country remains tied to local, and regional issues and does not emerge as a serious player on issues of global importance.

Among the top five military spenders, India however has surprised analysts the most this time. For decades, it has continued to maintain a low profile on military and strategic issues. With Nehruvian economics and politico-strategic thinking, its real position in the world has continued to slide so much that even the neighbouring countries like Nepal, Sri Lanka, Maldives have moved towards China for meeting their military needs. The situation has changed in the last few years and India’s new thrust on the politico-strategic and economic competition with China with an outreach to its neighbours along with countries like Vietnam, Mongolia, Philippines, Myanmar has slightly altered the balance.

The Indian challenge to China in the Doklam region in Bhutan and subsequent forced reversion to the status quo by both came as a cruel shock to China. Further, Indian arms exports to Vietnam and investments in its oil blocks did infuriate it very badly. Very recently, the unabated Indo-Chinese stalemate at the Himalayan borders and clashes with a real possibility of turning into a fierce limited war has made China realise the significant changes in Indian thinking, policy, and resolve to confront against the previous policy of avoiding it. This very idea has led to a substantial increase in Indian defence spending and hence in conventional and nuclear domains, we have been witnessing its China-oriented approach with preparations for a two-front war against both nuclear neighbours, China and Pakistan also being worked upon by India. However, it is more than certain that the country has China in mind while deliberating and refining its contemporary security doctrine.

With a 6.8% increase in military expenditure in 2019 as against 2018, India has spent $71.1 billion and has emerged as one of the top three military spenders in the world. Though pension and relief for its huge military of more than a million accounts for a substantial part of its military spending, nonetheless the sharp increase in defences is significant. On the one hand, it indicates a growing gap between Indian and Pakistani military power, on the other, it shows a purely calibrated Indian stance of moving from purely a defensive posture to one of competition and confrontation, as and when needed against China.

Further, there are pointers indicating the Indian strategy of moving beyond protecting its own backyard only to one of expanding outreach to countries beyond its land and seashores. It currently operates military bases or facilities at a number of places beyond Bhutan, Nepal, the Maldives to parts of the middle east, and Africa. It certainly shows its determination to gradually evolve from being a regional player, something that China would be comfortable with, to global military power.

The fourth and fifth countries on the list are Russia and Saudi Arabia. Russia, of course, being the only other superpower besides the US, continues to invest heavily in developing new military hardware and technologies, with the aim to enhance its capabilities and also at exploring new export markets. In 2019, it recorded a military expenditure of $65.1 billion and a substantial part of it involved money spent on developing new generation fighter jets and missile systems.

Saudi Arabia has been also among the major military spenders. With an expenditure of $62 billion last year, it retains its focus on rivalry against Iran and incessant efforts to retain leadership of the Islamic world. Though there have been some unstructured efforts from Turkey along with Malaysia and Pakistan to forge a third front to lead Muslim countries, the plan remains a distant pipedream.

Japan and South Korea are the other Asian countries with military expenditures to the tune of $47.6 billion and $43.9 billion as major spenders in 2019. While South Korea’s expenditure can be attributed to the very unpredictable and dicey state of relationship with North Korea, Japan has been compelled to raise its military budget due to the increased instances of Chinese incursions in its territorial waters and nearby South China Sea.

In the south Asian region, another major military spender Pakistan has enhanced its military spending in 2019 to $10.3 billion, registering an increase of 1.8% of its military expenditure in the previous year, 2018. Though as against the other two major military powers in the region, China (14%) and India (3.7%) of the global military spending in 2019, Pakistan accounts for a mere 0.5% of world military expenditure for the year, yet as a percentage of national GDP, its expenditure at 4% is significant as against that of 1.9% (China) and 2.4% (India). It also needs to be noted that as against the 2nd and 3rd positions of China and India on the global level, Pakistan stood 24th in terms of its military spending in 2019. Of course, a lot of this figure needs to be analysed in terms of the size of national economies of the three nuclear countries in the region but the fact that the expenditure is constantly increasing, in itself is indicative of the fact that the politico-diplomatic relationship requires a lot of overhauling among the countries.

On a regional basis, while the relationship between China and Pakistan is extremely affable, all-weather friends and iron brotherly, against India both countries have huge disputes, especially territorial ones. While Indo-Pakistan relations since independence have been difficult, the recent downgrading of diplomatic contacts has further complicated and deteriorated the relationships. The August 5 revocation of the special status of Jammu & Kashmir by India brought about a new low between the two. The name-calling of Indian PM Modi by Imran Khan, the Pakistani PM has not helped the matters either. The proposed 15th November elections in Gilgit-Baltistan is certain to further aggravate matters.

The recent increased military spending and acquisition of new weapons by Pakistan, mostly from China to the perceived Indian threat reveals the level of distrust and lack of communication between the two nations. While the situation on the Indo-Chinese borders already resembling a fight about the begin, the incessant militarisation on the LOC, does paint a grim picture. It suggests unless political initiatives are soon undertaken, the Indo-Pakistan relations like the borders will remain hot and military spending on both sides will continue to increase.

The Indo-Chinese relationships for the first time in decades are so low and volatile. A very strong reason as Chinese Foreign Minister Wang Yi suggested is the undemarcated borders between the two. Till borders are not properly marked, disputes between borders troops are highly likely whereas even the political leadership on occasions might well get inclined to cease some territories of the other for strategic and political gains. Currently, this border remains one of the most militarised and tense, the fact that the countries involved China and India are the two most prolific military spenders currently, also is a matter of great concern.

On a global level, the enhanced degree of global military expenditure has indicated a heightened degree of politico-security turbulence around the world. The US and West Europe continue to be wary of Russia while China with its belligerent behaviour, aggressive and dominating diplomacy, even during the unprecedented Corona crisis, has made countries in the region such as Japan, India, Vietnam, Philippines, Malaysia suspecting of its intentions. The continuing mistrust between the top two military powers, the US, and Russia fuel the latter’s pursuit of more advanced weaponry and hence, a substantial part of its resources remain directed towards military expenditure.

With Corona creating global mayhem, there is a real possibility of defence spending coming down substantially in the ongoing year. Most of the countries are likely to have lower budgetary allocations on the military in 2020, except probably the US, China, India, Pakistan, and Taiwan. With the situation in the Asian region remaining volatile, especially in South China Seas, Indo-Pacific, and Indo-Chinese borders, these countries may well continue expanding their respective arsenals. On the Turkish-Greek borders too, the situation is worrisome, and hence enhanced level of military spending is a real possibility. One can be sure, Corona crisis notwithstanding the year ahead is not going to be uneventful and military spending among important countries, especially in Asia will remain in focus.

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