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China’s defence budget climbs 6.8%, biggest hike in 2 yrs, amid border tensions with India

The defence spending is expected to increase to $208 bn in the coming year, China said Friday at the start of the annual National People’s Congress meeting in Beijing.

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Beijing: China projected defense spending growth of 6.8% this year, the largest increase since 2019, amid tensions with the U.S. and key neighbors.

Defense spending is expected to increase to 1.35 trillion yuan ($208 billion) in the coming year, the Ministry of Finance said Friday. The figure, released at the start of the annual National People’s Congress meeting in Beijing, compares with a gain of 6.6% last year, the slowest since at least 1991.

A Bloomberg calculation of the latest budget number shows the defense spending figure for this year will actually rise 6.9%.

“We will provide stronger financial guarantees to vigorously support the modernization of national defense and the armed forces, and help China’s defense capabilities rise in step with its economic strength,” the Ministry of Finance said in a report.

The defense spending boost comes after China sparred with India on its border and as the nation seeks to modernize its military to make it more competitive with the U.S. China, the only major economy in the world to expand last year, also announced on Friday an economic growth target of above 6% for the year, well below what economists had forecast.

“We will boost military training and preparedness across the board, make overall plans for responding to security risks in all areas and for all situations, and enhance the military’s strategic capacity to protect the sovereignty, security and development interests of our country,” Chinese Premier Li Keqiang said in an annual report to the national legislature.

Also read: China-linked hackers still targeting NTPC despite Ladakh disengagement, US firm says

Border standoff

China engaged in a tense standoff with India over border issues that turned violent in June last year, when 20 Indian soldiers and at least four Chinese troops were killed in hand-to-hand fighting. The deaths marked the first time casualties were reported along the disputed frontier since 1975. The U.S. has tested the country’s red lines on Taiwan with official visits and arms sales, and tensions with several countries have also heated up in both the East and the South China Sea.

Recent diplomatic assertiveness by Beijing has come as China rebounded much better than other major economies. Chinese President Xi Jinping has vowed to make the nation a great military power in the coming decades. He pledged to complete the modernization of China’s armed forces by 2035 and to build a world-class military capable of winning wars across all theaters by 2050.

Pay boost

“Considering Beijing’s threat perceptions and goal of achieving military modernization by 2035, I’d expect defense spending to continue to be a priority,” said Meia Nouwens, senior fellow for Chinese defense policy and military modernization at the International Institute for Strategic Studies.

China plans to boost pay for some personnel by 40% this year to lure and retain talent as it pursues these goals, the South China Morning Post reported in January.

The figure on China’s military spending is closely watched by U.S. and policy makers around Asia because it is one of the few pieces of official data available that helps gauge the development of the People’s Liberation Army.

Analysts outside China say actual military spending far exceeds the official figure presented every year at the legislative meeting, partly because R&D expenditures are not included. In January, researchers at Stockholm International Peace Research Institute updated the way it calculates China’s defense spending for 2019, estimating the Asian nation’s outlay at 1.66 trillion yuan, or 38% more than the official figure.

That works out to 1.7% of the country’s gross domestic product for the year, according to the institute, while the U.S. spent 3.4% of GDP on defense in 2019. The figure for India, the world’s third largest military spender, was 2.4%. – Bloomberg

Also read: China will continue to assert itself, seeks to dominate Indian Ocean Region, says CDS Rawat


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  1. China is bigger country. It area is 2.6 times of india. Population is more or less same or little more. Educationally far better than India. Financially much bigger than india. Nominal gdp of china in 2019 20 was 13 tn dollar. Where as india was 2.6 tn dollar. Hence it like palmkin to orange. Hence no comparison. But see other way. China having bigger threat from USA. Direct fight between two. First about economy. Then comes to military power. China needs more money to give big fight to America. There is struggle for supremacy in world stage. Now presently in south china sea. China needs very big military presence in the south china sea to make it relevance. China’s main enemy is USA not India. China would not think full scale war with india. Rather china put its 70 percent attention to sc sea. Taiwan is big thorn in china game. Infia is big power in asia after china. Hence china would keep india busy to restrict India to grow big. But modiji has given sleep less night to china due to its fast degradation of border infra and induction of better fighter in IAF. India positioned force and equipment in LoAC as Mirror position of china. Hence china is in fixed in indian border and cannot increase more men and machinery. Now both sides have trying to put more attention in border. But actual pressure will be exerted by Quad. Now the game is in mind and diplomatic pressure. China never imagined the new India under new government.

  2. India China border dispute does not extend over populated area with any local support to China. Even if China succeeds in pushing India in those area finally retaining them will eventually need manpower stationed in most inhospitable conditions.
    The increase in the defence budget may improve technical capability but will have no effect on the man per man equation, where territory is to be conquered and held. Stand off attack capabilities in such situation does not help achieve the objective. Destruction of the ground infrastructure and one sided loss of life will only lead to a devastating response spinning out of control, inviting the exercise of deterrence capabilities.
    The limitations that exist on the western border are also applicable on the northern and eastern borders with changed roles.
    Any major conflict between countries with deterrence capabilities is unthinkable unless total first strike annihilation is contemplated, so the enhanced defense budget is unlikely to have any serious effect on border tensions with India.

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