China increases defence budget by 7.6 per cent

China today increased its defence spending by 7.6 per cent to USD 146 billion, making it almost four times more than India's defence budget despite being the Communist giant's lowest hike in six years.
Amid raging disputes in the South China Sea and deepening tensions with the US, the government, in a budget report presented to the national legislature annual session here, said it plans to raise the 2016 defence budget by 7.6 per cent to 954 billion yuan (about USD 146 billion).
The single digit increase is the lowest in six years. Last year, China increased the defence budget by 10.1 per cent to 886.9 billion yuan, which in dollar terms amounted to USD 145 billion with prevailing exchange rate.

The Chinese currency has depreciated in the past few months after last year's nearly four per cent devaluation. As a result, this year's budget in dollar terms amounted less despite a 67.1 billion yuan increase.
China is the world's second largest economy and also the second largest defence spender. The US is the world's largest economy and the largest defence spender. The United States' proposed defence budget this year stood at USD 534 billion.
This year's new increase will do little to close that gap, the state-run Xinhua news agency reported.

China's military expenditure had seen a five-year run of double-digit increases between 2011 and 2015.

The budget report did not offer further breakdown of the figure nor explained the rationale behind the abated growth, although some officials and military experts have pointed to China's economic slowdown, the report said.
The slowdown remained a dominant theme as Chinese Premier Li Keqiang, who presented a work report to this year's inaugural session of the National People's Congress (NPC), today lowered this year's GDP target to 6.5 per cent saying that the economy was facing headwinds.
The 2.3 million strong People's Liberation Army, (PLA), the largest in the world is also poised to cut three lakh troops. The cut, announced by Chinese President Xi Jinping in September last year, might have also helped drive down the defence budget growth figure.

While China weighed its military spending, comparing itself with the US, from India's point of view the gap with its largest neighbour amounted to nearly four-fold.
This year's India's defence budget presented by Finance Minister Arun Jaitley proposes a 9.7 per cent increase amounting to Rs. 2.58 lakh crore. This in dollar terms works out to about USD 40 billion. It virtually remained the same at last year's levels due to depreciation of the rupee.
(Reopens FGN 12)
"China's development of high-tech weapon systems have been picking up in recent years. There is no need to spend hugely to catch up with the US, which seeks to keep its global military presence. China's regional military deterrence aimed at national defence has been taking shape," the daily said.

"Annual growth of 7-8 per cent means doubling the current level in a decade and reaching close to half of the US military spending. Such steady growth is more sustainable," it said.
Also the "Chinese government does not want to irritate other countries and trigger an arms race. Domestically, the government does not want to make its people anxious, as if major military conflicts are pending," it said.
The increasing US "provocations" in the South China Sea have been creating a greater sense of crisis for the Chinese people, the Global Times said.
Outlining China's strategic perspectives, Spokesman of the NPC and former Vice Foreign Minister Fu Ying yesterday defended Beijing's increasing its defence spending due to US forays into Asia Pacific and the South China Sea (SCS) which in recent months has become new theatre of conflict between the two countries.

Some people have connected China with the SCS issue and militarisation of the region. The issue of militarisation has been hyped up and misleading, Fu said.
China claims almost the whole of the resource-rich South China Sea. Its claim, however, is strongly contested by the Philippines, Vietnam, Malaysia, Brunei and Taiwan.
In October, USS Lassen, a guided missile destroyer, sailed within 12 nautical miles of an artificial island China is building in the Spratly Islands.
China strongly protested the move, saying the the US act severely violated Chinese law, sabotaged the peace, security and good order of the waters, and undermined the region's peace and stability.

"Talking about the militarisation if we look at the advanced aircraft and ships entering the area, majority of them (are) from US," Fu said.
It was America which decided to deploy 70 per cent of its naval assets under its Asia Pivot strategy, she said.
"Isn't it militarisation?" Fu asked. Wrongly accusing China's militarisation in the waters is misleading, she said.
"Most of Chinese lawmakers and ordinary people are not pleased and do not agree with the US showing off military power by sending warships to waters close to the SCS islands and reefs," she added.