China's Defence Spending Surges by 7.2% Amid Economic Slowdown

China increased its defence budget by 7.2% to $232 billion as it continues to pursue the modernization of its military amid ongoing tensions with Taiwan, the South China Sea disputes and the border frictions with India. The nation will remain the second highest spender on defence after the US and has allocated 1.67 trillion yuan (about USD 232 billion) for defence spending. The increase in terms of the percentage was the same as last year, a report by the PTI said.

In comparison to India, China’s 2024 defence budget was almost three times higher than that of India. India allocated about $74.8 billion for defence, which amounted to Rs 621,541 crore.

China has set an economic growth target of “around five percent” in 2024, the same goal as last year but far lower than previous decades.

Beijing has struggled to sustain its rebound from the Covid-19 pandemic as a property sector crisis and flagging consumption weigh on growth.

The defence spending remained unchanged despite the economic slowdown as China appears to prioritise the simmering territorial disputes with some of its neighbours while also countering the US as Beijing tries to dent US dominance of the global economy.

China views Taiwan as a rebel province that must be reunified with the mainland, even by force.

On Taiwan, Li said China would “resolutely oppose separatist activities” aimed at the self-ruled island’s independence and “external interference”.

He said Beijing would seek the “peaceful development” of ties with Taiwan but did not commit to “peaceful unification” as mentioned in previous years.

Beijing claims most of the South China Sea, while the Philippines, Vietnam, Malaysia, Brunei and Taiwan have counterclaims.

Tensions between China and the Philippines have risen over the past few months as the latter, backed by the US, stepped up efforts to assert its rights over the part of the South China Sea firmly resisted by the Chinese coast guard ships.

Some Western analysts believe Beijing ploughs a significant amount of extra money into its armed forces without officially disclosing it, a report by news agency AFP said.