New Delhi: Despite the economic slowdown due to Covid pandemic, Chinese defence companies have seen a sharp rise in global sales with eight of its companies among the top 100 arms manufacturers in the world while the US – which is still the biggest exporter – registered a drop in sales.
A report by Swedish think-tank Stockholm International Peace Research Institute (SIPRI) found that arms sales from the eight Chinese companies reached $109 billion in 2021, an increase of 6.3 per cent from their 2020 revenue.
Arms sales of the top 100 weapons manufacturers from across the world grew to $592 billion in 2021, a 1.9 per cent jump in total sales from 2020, the annual SIPRI report stated.
Notably, the combined arms sales of the 21 companies from the Asia and Oceania region reached $136 billion, in contrast to $123 billion generated by the 27 European companies last year.
“We might have expected even greater growth in arms sales in 2021 without persistent supply chain issues,” said Dr Lucie Béraud-Sudreau, director of the SIPRI Military Expenditure and Arms Production Programme.
Further, SIPRI suspects the Ukraine-Russia war to further complicate supply chains for arms companies, and thus affect the sales figures for this year. With Russia being a major supplier of raw materials used in weapons production, the war could hinder production in Europe and the US, the report added.
Only two names from India – HAL & BEL
Hindustan Aeronautics Limited (HAL) and Bharat Electronics Limited (BEL) were the only two companies from India on the index. However, both companies saw an increase in their revenue last year.
HAL saw its revenue rise by 6.7 per cent and was ranked 42nd among the 100 names. Meanwhile, BEL’s sales increased by a whooping 20 per cent and was ranked 63rd on the list.
“Indian Ordnance Factories, which appeared in the 2020 edition of the Top 100, was restructured into seven smaller companies in October 2021 and thus dropped out of the ranking,” the SIPRI report said.
Significantly, this was also the first time that a company from Taiwan was included in the top 100. NCSIST or the National Chung-San Institute of Science and Technology, a manufacturer of missiles and military electronics, had sales worth $2 billion in 2021.
As many as 40 out of the 100 companies were from the United States. However, their sales dropped by 0.9 per cent to $299 billion in 2021, said the report.
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4 Chinese companies among top 10
Of the eight Chinese companies that featured among the top 100, four made it to the top ten on the index and seven of them registered a rise in arms sales in 2021, the SIPRI list found. At rank 7, NORINCO, a land systems specialist, was the highest-ranked Chinese firm. Its revenue rose to $21.6 billion in 2021, marking a surge of 11 per cent from 2020.
“The growth in arms sales reflects the scale of China’s military equipment modernisation and its objective to become self-reliant in the production of all categories of major arms,” the report noted.
China also finalised a successful merger of its two shipbuilding companies — China State Shipbuilding Corporation (CSSC) and China Shipbuilding Industry Company (CSIC) — resulting in a new joint shipbuilding entity operating under the name of CSIC.
“With arms sales of $11.1 billion, CSSC was the largest military shipbuilder in the world in 2021,” the report mentioned.
27 European firms on list, 8 from UK
Despite notching fewer sales than the companies from the Asia-Oceania region, the European firms saw a 4.2 per cent growth in revenue compared to 2020.
Further SIPRI suspects that “sales will probably continue to rise in 2022 as the demand for arms grows in Europe due to Russia’s invasion of Ukraine.”
Of the 27 European names on the list, eight were from the United Kingdom – the most for the continent. These accounted for a cumulative sale of $40 billion. However, this was 2.7 per cent below their sales in 2021, the report added.
From Russia, six companies made it to the SIPRI record, three less than the nine in 2020. This was primarily because “no data was available for Almaz-Antey, KRET and Russian Electronics,” SIPRI said.