Saturday, March 24, 2007

Increase in China's Military Budget by over 17% and Indian incognizance

China's defense budget to rise 17.8 percent in 2007

China's defense budget for 2007 is expected to hit 350.92 billion yuan (44.94 billion U.S. dollars), 17.8 percent higher than that last year, a spokesman for China's top legislature's annual session said on 4th March. The figure marks an increase of 52.99 billion yuan (6.79 billion dollars) over that last year.

This year's defense budget accounts for 7.5 percent of the China's budgeted fiscal expenditure, compared with 7.7 percent in 2004, 7.3 percent in 2005 and 7.4 percent in 2006, said Jiang Enzhu, spokesman for the Fifth Session of the Tenth National People's Congress, the top legislature of the country. Jiang noted that China's military spending remains a low level compared with some other countries, especially the big powers, either in the sense of total sum or the ratio against their GDP (gross domestic product) and total fiscal expenditure. Taking the year 2005 as example, China's military expenditure stood at about 30.6 billion U.S. dollars, only 6.19 percent of the U.S. military spending, 52.59 percent of Britain's, 71.45 percent of France's and 67.52 percent of Japan's, said Jiang while answering questions from an NHK reporter.

What's behind increase in the military budget
The increase has drawn wide attention from the international community. Many express misgivings out of shear misunderstanding. But some look at the increase through stained lenses or stretch the matter to suit their own ends. Others try to use the growth in China's military spending to create a propaganda splash.

The growth is primarily caused by the sharp increase in the wages, living expenses and pensions of 2.3 million People's Liberation Army officers, civilian personnel, soldiers and army retirees. The pay rise came in the latter half of 2006. Large numbers of officers from battalion level down and non-commissioned officers received the sharpest pay rise 100 percent. The pay of the officers from the regimental level up, civilian personnel and army retirees has also been increased by 80 percent. At the same time, all rank-and-file soldiers' living allowances and board expenses have also been increased...hardware research and development and weapons procurement has also increased. And the money spent on training and exercises and on maintaining military activities has risen, too. But this kind of spending growth pales beside the increase in personnel expenditures.

China's military spending falls far behind that of many other countries, whether in terms of actual amount, military personnel per capita expenditure, or the general population per capita military spending. The country's military budget ranks fourth among the world countries and its GDP also stands fourth in the world. Coincidence? Maybe. I think the two No 4 positions are logically connected to each other.

The US military's per capita budget in 2007, for instance, is $383,000, the highest in the world. Next comes Britain ($324,000), followed by Japan ($175,000), Germany ($148,000) and France ($146,000). In contrast, China's per capita spending on its soldiers is only US$19,540. The country has set a rather moderately paced timetable by today's international standards to modernize its military forces. Extending to 2050, it covers three stages: from 2006 to 2010, from 2010 to 2020, and from 2020 to 2050.

Western military analysts are very clear that Chinese fleets, air force, ground troops and strategic rocket forces are on a secondary tier with the world's leading military powers in terms of quality and quantity of its core battle equipment. The basic facts and stark reality determine that it is impossible for China to enter an arms race with the world's military powers.


I am yet to come across an Indian assessment of the increase in the Chinese military budget. I am not privy to all sources where such an assessment would appear but I do have a general idea. I am not even sure if I can speak for the China watchers in India but I do enjoy a general proximity to the exalted group and let me assure they are probably the most enlightened group of strategic scholars you would find in India. But there is no doubt that most of our expertise flows out from the binary (growth or collapse, democracy or disorder, oppurtunity or threat, ally or rival) American analysis of China. So it is with this year's increase in the Chinese military budget, there is no Indian perspective as yet. The past week saw an interaction at Neemrana, Haryana between America's South Asia and China experts with the China experts in India and an authoritative source tells me that the Americans largely concur with the argument that the growth is primarily caused by the sharp increase in maintenance costs. This post is not so much to seek an alarmist reaction to the 17.8% rise in China's military budget but more like a registration of the lacunae in Indian strategic mapping. We, in India, have been harping on the China threat effectively since 1959 (when PLA 'liberated' Tibet) and in more realist thinking as early as 1949. However, it was only in 2006 that Indian newspapers got correspondents in China. This post is meant to convey that we are missing out a lot of the day to day developments in China and therefore our reading of China is inevitably reduced to procuring data from 'Western' sources. Or this could mean that India hypes its security dependence on China without any concurrent efforts, internal or external, to balance the burgeoning Chinese growth.

More: Chairman of U.S. Joint Chiefs of Staff sees no threat from China

Post Script: I was able to actually locate an Indian article on the China's military budget. While I have my reservations against a number of assertions it provides a good account of the debate with regard to the mysteries of Chinese Defense Spending.

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