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China's defence budget crosses $100-bn mark

China’s defence budget for 2012 will be increased by more than 11%, taking it above the 100 billion US dollar mark for the first time. Sutirtho Patranobis reports.
Hindustan Times | By Sutirtho Patranobis, Beijing
UPDATED ON MAR 05, 2012 01:49 AM IST

China’s defence budget for 2012 will be increased by more than 11%, taking it above the 100 billion US dollar mark for the first time.

While Beijing has repeatedly maintained that its military strength will never go beyond national security demands, its expanding military prowess is likely to trigger unease in the region. With an aircraft carrier and stealth fighter aircraft being developed, the increase in budget for the armed forces is unlikely to dispel fears among the country’s neighbours.

Compared to India, China’s defence budget is nearly three times; last year, India had earmarked more than 36 billion US dollars. The US spends the most on defence and it’s said to be around 740 billion dollars. India’s budget on defence is the 10th largest; China’s is the second after the US.

Jane's Defence and Security Intelligence and Analysis in a recent report predicted that China’s defence budget will cross the 238 billion mark by 2015. Reacting to the report, the defence ministry had denied the calculation.

On Sunday, it was announced China will spend 670.274 billion Yuan on defence this year. The draft defence budget is 67.6 billion Yuan more than the defence expenditure of 2011.

Li Zhaoxing, spokesperson for the annual session of the country’s legislature, the National People’s Congress, which begins its session on Monday, said; “The Chinese government follows the principle of coordinating defense development with economic development. It sets the country's defense spending according to the requirements of national defense and the level of economic development.”

Li told reporters the growth of China's defense expenditure is "reasonable and appropriate."

"The Chinese government has maintained reasonable and appropriate growth in defense spending on the strength of rapid economic and social development and the steady increase of fiscal revenues," he said.

According to Li, during the last three years since the outbreak of the international financial crisis, China's gross domestic product (GDP) and national fiscal expenditure showed year-on-year growth of 14.5% and 20.3%, respectively, but the country's defence expenditure only grew by 13%.

He also noted that the share of defense spending in China's GDP dropped from 1.33% in 2008 to 1.28% in 2011.

Compared to other major countries, China's military spending is low given its population of 1.3 billion, vast land area and long coastlines, Li said.

While China's military spending amounted to 1.28 % of its GDP in 2011, that of the United States, Britain and other countries all exceed 2 %, said Li.

"The limited military strength of China is solely for safeguarding its national sovereignty and territorial integrity, and will not pose a threat to any country," said Li.

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