Thayer Consultancy Background Briefing:

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Asia Pacific Region Defence
Spending and Arms Acquisitions
Carlyle A. Thayer
January 24, 2018

The Asia Pacific is the largest importer of weapons of any region in the world. It
accounts for 43% of global imports. Defence acquisitions increased by 7.7% between
2007-11 and 2012-16.
Defence spending in the Indo-Pacific region is increasing but at a slower pace in 2017
than over the last several years. For example, total defence spending in Asia Pacific
Region (APR) increased more than 5 percent in real terms from 2013-15. This slowed
to 1.4% in 2016-17. Part of this trend may be explained by China’s slowing growth
rate.
The decrease in the rate of defence spending is most noticeable with China whose
defence budget grew at just under nine percent between 2012-16 in real terms, but
fell to 4.7% per cent in 2017. These percentages are based on China’s official
budget figures that do not capture all defence expenditure such as R&D and arms
imports. China’s defence spending represents something on the order of forty
percent of total defence spending in the APR.
India’s defence spending, in real terms, accounts for about fourteen percent of the
APR total, or the second largest after China. When India’s defence spending in 2016
is compared with 2017, the growth in real terms was a paltry 0.03 percent increase.
Japan, South Korea and Australia are the next three biggest defence spenders in the
APR.
Among arms importers in the APR, India (13% of total) and China (4.5%) rank first
and second respectively. South Korea ranks thirteenth (2.5%) and Japan (1.1% ranks
twenty-first. In looking at arms imports it is important to note that India, China and
South Korea all have robust national defence industries that produce modern
weaponry. Details on national production and stock piles are not captured in data
bases dealing with the arms trade in general.
India’s top three arms suppliers are Russia (68% of total), the United States (14%)
and Israel (7.2%).
India’s major acquisitions in 2015-16:
 Russia: four Talwar-class frigates, at least 464 T-90S main battle tanks, 216 PJ-10
BrahMos anti-ship missiles, 200 Ka-226T Segei light helicopters and a number of
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anti-tank missiles (25,000 delivered over the period 1992-2016 but no separate
figures for 2015 and 2016.
 United States: four P-8-A Poseidon anti-submarine warfare aircraft (eight
Poseidons were delivered between 2012-15), 1,354 Hellfire anti-tank missiles, 22
Apache combat helicopters, 15 Chinook transport helicopters, one C-130J
Hercules transport aircraft, 12 Longbow helicopter combat radars, 12 Harpoon
anti-ship missiles, thirty assorted turboprop and turbofan spares for helicopters.
 Israel: 18 SPYDER medium range air defence missile systems, four EL/M-2248
MF-STAR multifunction radar systems, two EL/M-2075 Phalcon Airborne Early
Warning and control systems, combat and air search radars, ten Heron UAVs,
guided bombs and anti-tank missiles.
China’s top three arms suppliers are Russia (57%), Ukraine (16%) and France (15%).
China’s major acquisitions in 2015-16:
 Russia: six S-400/SA-21 surface to air missile systems, 24 Su-35 ground attack
fighter aircraft, and 584 assorted turbofan spares delivered over the period
2012-16.
 Ukraine: gas turbines for PLAN frigates (delivered from 2013-16).
 France: several thousand Crotale surface to air missiles (delivered over the
period 1990-2016).
South Korea’s top three arms suppliers are the United States (60%), Germany (30%)
and Israel (5.2%).
South Korea’s major acquisitions in 2015-16:
 United States: 219 Standard Missile-2MR surface to air missiles delivered
between 2009-15, six Phalank Mk-15 Close In Weapons Systems delivered
between 2013-16, firtgh AIM-9X /sidewinder Short Range air to air missiles, 100
AFM-65 Maverick anti-submarine missile (2015-16), 134 combat ac radars, 63
Stinger portable surface to air missiles, eight Patriot PAC-3 surface to air/anti-
ballistic missile systems (2015), 112 MIM-104C PAC-2 surface to air missiles
(2016), three SPY-1D air search radars, and 240 turbofans, 36 gas turbines and
38 diesel engines, delivered between 2008 and 2015.
 Germany: six Type-214 submarines delivered between 2014-16, 90 Taurus KEPD-
350 anti-ship missiles, and 985 diesel engines for self-propelled guns.
 Israel: three Heron UAVs and sixty EL/M02032 combat radars.
Japan’s top three arms suppliers are the United States (90%), United Kingdom (5.3%)
and Sweden (2.6%).
Japan’s major acquisitions in 2015-16:
 United States: 24 AE-2100 turboprops delivered between 2007-16, 100 RIM-
116A RAM surface to air missiles (2015), 4 E-2D Hawkeye AEW&C aircraft
(22015-18), 17 V-22 Osprey transport helicopters (2015), RIM-161D SM-3 Block 2
surface to air/anti-ballistic missiles (2016) and two SPY-1F air search radar
systems.
 United Kingdom: fourteen EH-101-400 transport helicopters delivered between
2006-16, and 3 air refuel systems for tanker/transport aircraft delivered in 2015.
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 Sweden: 36 Stirling Air Independent Propulsion (AIM) engines for Japan’s Souryo-
class submarines.
Other Countries
In 2015 all countries in Southeast Asia experienced real increases in defence
spending, notably Thailand and the Philippines who both increased defence
spending after lower figures in 2014. But this trend has reversed in 2017.
Vietnam ranked eighth largest imports of weapons in the world for the period 2011
to 2015, up from just 43rd in the previous five-year period, But Vietnam dropped to
tenth largest importer for the 2012-16 period.
Regional countries are definitely acquiring drones or UAVs (unmanned aerial vehicles
in the text above). Both Indonesia and Vietnam are now manufacturing their own.
But I do not see this at the expense of aircraft. Vietnam, after all, is looking for a
replacement fighter to replace its MiG-21 fleet that it retired over a year ago.
Cyber is a growing concern to all regional countries because if the US and Australian
defence establishments can be hacked, what hope to they have of defending
themselves. Cyber has been specifically raised as a new area for U.S.-Vietnam
defence cooperation.
The bottom line is that China is expanding its navy and air force and growing in
technical sophistication, regional states have to find a way to offset the asymmetry
in the military balance of power. Drones are being used to assist in targeting ships at
sea. But regional states are buying, co-producing or developing their own capacity to
manufacture sophisticated anti-ship, anti-surface, anti-air and air to air missiles. Fifth
generation aircraft are here to stay.

Suggested citation: Carlyle A. Thayer, “Asia-Pacific Region – Defence Spending and

Arms Acquisitions,” Thayer Consultancy Background Brief, January 24, 2018. All
background briefs are posted on Scribd.com (search for Thayer). To remove yourself
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other research support to selected clients. Thayer Consultancy was officially
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