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Rediff.com  » News » Huge hike in China defence budget

Huge hike in China defence budget

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March 04, 2005 14:22 IST
China on Friday announced that it would hike its military budget this year by a whopping 12.6 per cent to 29.98 billion US dollars to modernise the People's Liberation Army (PLA).

The State Council, China's cabinet, has proposed the country's top legislature approve a 247.7 billion yuan (29.98 billion US dollars) national defence budget for 2005, a senior official told reporters here.

This is the first time that China has officially confirmed its military spending prior to the start of the annual parliament session. Normally such figures are released when the Chinese Finance Minister presents the budget for the year at the National People's Congress.

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"This is still a fairly small amount compared with (the military spending) of other major countries in the world, in terms of its proportion to China's total financial expenditures and gross national product," a spokesman of the upcoming third annual session of the National People's Congress (NPC), China's parliament, said.

China has announced double-digit increases in military spending nearly every year for more than a decade as it modernises the 2.5-million-member PLA, the world's biggest standing army. Western defence analysts often say that China's total military spending is much more than the officially announced figure.

The money will be mainly used for the military's armament upgrading to promote the modernisation of China's national defence as well as raise of salaries and social security benefits for the servicemen, the spokesman said.

The enhanced budget will also provide for compensating officers and soldiers discharged from the PLA in China's latest move to cut its troops by 200,000, he said.

China's military budget has increased by double digits over most of the last 15 years with defence spending rising by more than 17 per cent in 2001 and 2002. It fell to a 9.6 per cent in 2003 before rising again to 11.6 per cent last year.

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