China defence budget 10 pct rise to defy slowing economy

Discussion in 'China' started by Illusive, Mar 6, 2015.

  1. Illusive

    Illusive Senior Member Senior Member

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    China defence budget 10 pct rise to defy slowing economy

    China's defence budget this year will rise about 10 percent compared with 2014, a top government official said on Wednesday, outpacing the slowing economy as the country ramps up investment in high-tech equipment such as submarines and stealth jets.

    Parliament spokeswoman Fu Ying told reporters the actual figure would be released on Thursday, when the annual session of the largely rubber-stamp National People's Congress opens.

    Last year, defence spending was budgeted to rise 12.2 percent to $130 billion, second only to the U.S. Pentagon's proposed $534 billion base budget.

    The official Xinhua news agency said the 2015 target - which would put defence outlays at around $145 billion - would represent the slowest growth in military spending in five years.

    China has logged a nearly unbroken two-decade run of double-digit budget increases, though many experts think the country's real defence outlays are larger than stated.

    The military build-up has rattled nerves around the region, particularly as China has taken an increasingly robust line on its territorial disputes in the East and South China Seas.

    Asked about China's defence spending, Japanese Chief Cabinet Secretary Yoshihide Suga said Japan was concerned the figure "lacks transparency."

    "It is true, regardless of China's defence spending, that the security situation in the region surrounding Japan is severe for various reasons," he added.

    "On top of our own efforts in the field of diplomacy and defence, it is extremely important for our country to strengthen the U.S.-Japan alliance."

    The U.S. Army's commander in Asia told Reuters China's rapidly increasing defense spending would only be a cause for alarm if Beijing used its resources to be provocative - as had happened in some parts of Asia.

    General Vincent Brooks cited "bullying behaviors that happen in the sea and in the air," or "pressuring that's being done in bilateral dialogues with countries to be prepared to make a choice between the relationship with the U.S. and the relationship with China."

    Other examples include "extraordinary maritime reclamation work" by China in the South China Sea, he said in an interview.

    Brooks said China was investing in defense at a pace "that really no one can keep parallel with" and this showed the need for closer U.S. interaction with Beijing's military.

    INDIA LAGGING

    India is working to narrow the military gap with China, which has unnerved New Delhi with forays into the Indian Ocean.

    An Indian defence official looking at regional security issues said the double-digit rise was no surprise.

    "There was some talk it could slow down in view of the economic slowdown, but our sense was modernization will remain on track," the official said.

    India has announced a $40 billion defence budget for 2015-16, representing a 7.9 percent rise over the allocation for 2014-15. Defence analysts said it may not be enough to acquire fighter planes, submarines and warships all at once.

    In addition to the Obama administration's proposed $534 billion base budget, it also wants to spend $51 billion in war funds as it urged Congress to end cuts it says erode U.S. military power.

    Fu said China faced greater challenges in modernising its military than "great powers".

    "We have to rely on ourselves for most of our military equipment and research and development," Fu said.

    "Fundamentally speaking, China's defence policy is defensive in nature. This is clearly defined in the constitution. We will not easily change this direction and principle."

    Serving and retired military officers have said pervasive graft has undermined the armed forces' prowess and morale among the rank and file, a problem robust spending may help alleviate.

    Former top military officers have been among the most powerful people ensnared as Chinese President Xi Jinping has pursued corrupt officials in all walks of life.

    While Beijing keeps the details of its military spending secret, experts have said additional funding would likely go towards beefing up the navy with anti-submarine ships and developing aircraft carriers beyond a sole vessel in operation.

    NAVAL SHOPPING LIST

    "Carriers have definitely got to be on the list," said John Blaxland, Senior Fellow at the Strategic and Defence Studies Centre at the Australian National University in Canberra.

    "But also we've seen a massive surge in the number of submarines, and of course everybody loves submarines. The intimidatory effect of a submarine is hard to beat."

    Money would also likely go into cyber capabilities and satellites, Blaxland added.

    China's leaders have routinely sought to justify the country's military modernisation by linking defence spending to rapid GDP growth. But growth of 7.4 percent last year was the slowest in 24 years, and a further slowdown to around 7 percent is expected in 2015.

    "We have achieved so much success with reform and opening up, we have not relied on gunboats to develop roads, but instead we have relied on complete and mutual beneficial cooperation," Fu said.

    "We have been successful on this road, the road of peaceful development."

    U.S. military and diplomatic "rebalancing" towards Asia and Xi's crackdown on corruption in the People's Liberation Army, are among the other factors keeping military spending high, experts have said.

    Beijing also says it faces a threat from Islamist militants in the far western region of Xinjiang, and is drafting an anti-terror law that will create a legal framework for sending troops abroad on counter-terrorism missions.
     
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  3. SREEKAR

    SREEKAR Senior Member Senior Member

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    China spreading its tantacles:pop:
     
  4. ezsasa

    ezsasa Senior Member Senior Member

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    Funny thought:

    In dollar terms China might be spending more than india, but in local currency aren't we spending more than chinese.

    Chinese defence budget:
    150 billion usd = around 975 billion rmb.

    Indian defence budget :
    40 billion usd = 2.4 trillion INR.

    At 975 billion in local currency, I am now wondering if they are even paying their soldiers properly, because as a regimental system we know roughly how much it costs to maintain a million plus army(salary cost wise).
     
    Last edited: Mar 6, 2015
  5. SREEKAR

    SREEKAR Senior Member Senior Member

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    same doubt:shocked:
    And from where did you get this info.....
     
  6. shiphone

    shiphone Senior Member Senior Member

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    some indian thought is really.....errrrr..........INCREDIBLE...........................LOL...
    don't make yourself the laughingstock again and again....

    BTW, this year the ROK(Republic of Korea) defence budget is 33.6 billion USD, in local currency it would be the "INCREDIBLE" 375 trillion... ...LOL....so what would you say?
    ----------------------------
    the China defence budget is always divided to three parts , around one third of the total amount each...
    1. personnel expenses
    2. costs for maintenance of activities
    3. costs for new equipment

    so of this year's 145 billion USD(900 Billion RMB) in total, 48 billion USD(300 billion RMB) for the Personal expenses (salary,subsidy,Pensions ) ,48 billion USD for daily maintenace ,training and exercise ...and around another 48 billion USD for the purchase of new weapons....
     
    Last edited: Mar 6, 2015
    sgarg likes this.
  7. karn

    karn Regular Member

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    Thats not how this works thats not how any of this works.
     
  8. ezsasa

    ezsasa Senior Member Senior Member

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    @shiphone
    There is a reason i started my argument by saying "Funny thought", But i am definitely delighted the way you are defending your argument with diagrams. That takes some dedication and commitment to the cause. Kudos :thumb:. Mission accomplished as far as i am concerned.
    @karn
    Would definitely like to know your argument.
     
    Last edited by a moderator: May 10, 2015
  9. karn

    karn Regular Member

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    Amount of local currency means nothing . I don't know why you that that it was relevant.
     
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  10. ezsasa

    ezsasa Senior Member Senior Member

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    Because in china's case, Majority of the defence procurement is local. They won't be paying for local goods in dollars.
    Don't worry even i am not convinced myself with my own argument.

    But one thing i would stress on is that chinese get ahead in a lot of economic indicators,just because they keep the currency conversion with USD very low. As of today 6.5 rmb = 1 usd.
    And the assumption that once our own domestic military industrial complex expands as expected, there is a chance that inspite of the difference in spending between both china and india , we will be expanding our assets at the same rate.
     
  11. ezsasa

    ezsasa Senior Member Senior Member

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    Hey @shiphone , by any chance would you know how much a Type 052D destroyer costs in your local currency?
     
    Last edited by a moderator: May 10, 2015
  12. karn

    karn Regular Member

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    Most of the budget goes in salaries and pensions which are payed for in rupees . And yes increasing local content will reduce foreign currency buys and hence increasing the actual purchasing power of the armed forces.
     
  13. Blackwater

    Blackwater Veteran Member Veteran Member

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    Array bhai pakis Ko free me stuff nahi dena. 10% uska increase ha
     
  14. ezsasa

    ezsasa Senior Member Senior Member

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    Now let me take salary argument a little further ...
    We spend about 1.44 trillion INR(60% of 40 bln USD * 60 INR) on 1.2 million soldier
    China seems to be spending 325 billion RMB on 1.3 million soldier...

    By that logic we seem to be spending on average 4 times more on our soldier.

    this leads me to draw two conclusions:

    1) In China the cost of living is so low that they are able to manage by spending 1/4 of what we are spending.
    2) They are compromising on their soldier.

    If it is no.2 which turns out to be true, we are unnecessarily worried about china.
     
    Last edited: Mar 6, 2015
  15. karn

    karn Regular Member

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    No you just don't seem to be getting it. 1 RMB is not equal to one rupee. It is in no way comparable . Giving a crude example in Beijing a bus ticket can cost 2 CNY in Delhi a ticket costs Rs 15 for the same 10km route .
    Also china has 2.4+ million armed forces personnel .
     
  16. shiphone

    shiphone Senior Member Senior Member

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    1. 15 years ago... PLAN spent around 10 billion RMB (around 1.2 billion USD @ 8.3 RMB :1 USD ) on the first batch of four 052B and 052C class DDGs (two vessels for each type)... nowadays at the rate of 6.2 RMB: 1 USD, PLAN would pay around 3.5-4 billion RMB for a new 052D class destroyer, it's around 0.55-0.65 billion USD..

    2. 10 years ago...PLAAF buy a J10/10A with 200 million RMB (around 24 million USD @8:3 :1 rate)...today, the new batch of J10B would cost 250 million RMB converting into 40 million USD @ the new yearly rate of 6.2:1...

    3. 30 years ago... China tank industry exported 2860 Type-69 II tanks and 286 ARV with the same chasis to IRAQ during the the Iran-Iraq war, which was the largest China tank export order ever....the unit cost was around 0.3-0.4 million USD ,but at that time the exchange rate was just 2:1 , which means in RMB, the prices was just 0.6-0.8 million...nowadays, PLA army would pay around 4 million USD(25 million RMB) for its latest and most advanced Type 99A MBT per unit...

    -------------
    BTW, the total number of the PLA tri-service including the Second Artillery Force(Strategic Missile Force) is 2.3 million

    including:
    Air force: 398 thousand
    Navy: 235 thousand
    Army (feild forces only): 850 thousand
     
    Last edited: Mar 6, 2015
  17. shiphone

    shiphone Senior Member Senior Member

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    LOL...you'd better have a sleep now ...

    and again

    the Number of soldiers of ROK is nearly 0.7 million....so with your incredible funny logic, it's 375 trillion(₩,KER) for 0.7 million size army....LOL...WOW!
     
    Last edited: Mar 6, 2015
  18. ezsasa

    ezsasa Senior Member Senior Member

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    I have no comments on Tanks and airforce, because total indigenisation in india is yet to be completed.

    But based on ships however, we seem to be spending roughly the same cost per ship both in india and china in local currency. i asked for type 52D because of 7.5k tonnage which is roughly equal to the profile of indian Kolkata class. Both seem to have the same cost of 3-4 billion in local currency.

    Thanks for the info. Doubt clarified..

    One more question, if possible
    Adding your force strength i am getting 1.4 million , what do the other 900 thousand do? is para military included in this?
     
  19. ezsasa

    ezsasa Senior Member Senior Member

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    i know, i like playing with numbers...:namaste:
    sometimes by using such stupid logics, i get various insights on pretty common topics...
     
  20. Illusive

    Illusive Senior Member Senior Member

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    @shiphone Any idea of R&D spending on defense, i know they are secretive but looking at the visible no. of programmes it could be more than your defense budget, making it par with US defense spending considering you get your jobs done cheaper than Americans.
     
    Last edited by a moderator: May 10, 2015
  21. shiphone

    shiphone Senior Member Senior Member

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    1. 052D is a 6000 tons class vessel.. it seems you have some problem reading the numbers...

    39 billion INR vs 3.5-4 billion RMB or 870 million(year 2011 rate) $ vs 550-650 million $

    ----------------

    2.
    the rest around 900 thousaunds strength includes:

    garrison force (e.g. border forces)
    Second Artillery Force(Strategic Missile Force)
    all ranks of Headquarters ,command authority
    military academies/institutes
    The army factory
    military hospital
    etc...

    but para military is NOT included
     
    Last edited: Mar 7, 2015

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