ISSN 2330-717X

China’s Defence Budget 2012: Implication’s For India’s Security – Analysis


By Dr Subhash Kapila

‘However, its less the size of China’s defense budget than its composition that alarms beyond its borders. China’s military spending privileges the navy, air force and strategic nuclear forces—instruments of advanced power projection—rather than traditional defensive capabilities. No Chinese leader has yet explained how these capabilities contribute to China’s peaceful rise”. — Daniel Twining, Washington, USA.

Introductory Observations

China’s Defence Budget 2012 announced in the first week of March 2012 significantly draws global and regional attention in that China has shot through its defence expenditure over the $ 100 billion mark, making China’s military expenditure at the global level, second only to that of the United States, even though there exists a wide differential between the two.

In terms of global concerns, China’s hikes in defence expenditures in 2012 military budget come under sharper scrutiny when China’s defence hikes are placed in the context of a sharp drop in United States defence budget by about $ 380 billion necessitated by US Congressional mandates. Though President Obama has reiterated that the Asia Pacific regional military posture of the United States would not be in the purview of budgetary cuts because of the new US strategic pivot to Asia Pacific, what cannot be ruled out is that in case of a sudden Middle East contingency, the United States would be forced to redirect US Forces from its strengthened posture against a fast militarily rising China.

Regionally in Asia, steep hikes in Chinese military expenditure cause multiple strategic and military concerns for China’s neighbours. Contextually, China’s recent aggressiveness and military assertion (facilitated by China’s military rise, fuelled by expanding economic resources) on territorial disputes foisted by China on virtually all its neighbours, multiply these concerns.

China - India Relations
China - India Relations

China’s military hikes would have been understandable had China’s peripheries on land and sea would have been threatening to China’s security. Such is not the case because the military balance is overwhelmingly in favour of China. China could convert this military balance in its favour for the last two decades because of United States earlier permissiveness to tolerate China’s military build-up as it suited United States and in the last decade because of the military and strategic distractions in Iraq and Afghanistan.

China’s expanded military budget comes immediately after President Obama’s announcement of the policy of a strategic pivot to Asia Pacific. China denies that the two are connected. In this connection it needs to be pointed out that China would continue to increase its military expenditure irrespective of any strategic steps of the United States. China’s strategic aims are to emerge as the undisputed military power in Asia and a rival power centre on the global strategic calculus.

In this connexion, it needs to be pointed out that scientific projections have been made which state that China’s military budget hikes are expected to total $ 238.2 billion by 2015 which when translated amounts to more than doubling China’s military expenditure in just another three years. China’s existing military profile a before the announcement of Budget 2012 is considerably powerful and would become more powerful with $106 billion planned for this year. Doubling of the budget by 2015 would facilitate China’s military profile to emerge so powerful that no Asian country, not even India, can ever hope to militarily catch up with China.

India’s defence budget in the year ending was about $36 billion—a fraction of China’s military budget. Shockingly, a former Defence Secretary was quoted in the media that every year the Finance Ministry would demand in March that the Defence Ministry surrender Rs 5,000 crores or so to balance the deficit in the Union Budget. He further added that for the last ten years the Defence Ministry was being made to surrender such amounts. This would total to Rs 50,000 crores cut from announced Defence budgets. This year the news has come that the Defence Ministry has been ordered not to sign existing defence purchases agreements till after 31 March 2012 including the order to purchase the 126 fighter planes badly needed by the Indian Air Force. It is distressing that to balance the Finance Ministry books and Union budget deficits arising from exorbitantly wasteful schemes, the Government plays around with India’s war preparedness in an extremely hostile environment.

India should be more than seriously concerned about China’s hiked defence expenditures considering that ‘The China Threat’ to India is more real than to other nations, simply because China perceives that India is its sizeable and comparable strategic and military Asian rival and could impede China’s rise and emergence as the undisputed military power in Asia. Strategically, it is ironic that despite the credibility and potency of ‘The China Threat’, India’s political leadership and apex national security establishment traditionally disconnected from its Armed Forces who manage ‘The China Threat’, continue to de-emphasize this threat and get tricked into China’s protestations that China’s rise is a ‘peaceful rise’.

Against such a backdrop it becomes incumbent on India’s strategic community to highlight and reiterate the implications arising for India’s national security of China’s rising military expenditures. This Paper intends to do so under the following heads:

  • China Defence Budget 2012: Salient Features and Thrust Areas for Military Up- gradation
  • India’s National Security: Implications of China Defence Budget 2012
  • Can India Ever Militarily Check-mate China?

China Defence Budget 2012: Salient Features and Thrust Areas for Military Up-gradation

Statistical data and comparative analyses of China Defence Budget abound in the international media and are not going to be repeated here. The aim in this Paper is to provide a macro-level overview the Chinese defence budget for 2012 and the issues arising from the salient features that will be examined. This part of the Paper intends to examine it under the following heads; (1) Chinese Defence Budget 2012 –salient details of increased military expenditure (2) Chinese official explanations for the increased military spending (3) Analytical explanations for China’s increased military spending, and (4) Main thrust areas for Chinese military up-gradation.

Very briefly, Chinese military spending in 2012 is planned to increase by 11.2% to $106.4billion from $ 95.6 billion last year. China has on the average registered an annual increase of 12% in its defence spending. Between 2006 and 2011 China doubled its defence spending and by 2015 it will again be doubled. That indicates the colossal military expenditures that China has indulged in and what is going to be spent by China in the next three years. The strategic and political implications for the United States, China’s Asian neighbours and particularly India are serious, deep-rooted and long-range.

China’s official explanations are the traditional choreographed ones of defending national sovereignty, internal security and the requirement of protecting China’s long borders with fourteen countries and China’s long coastline. However, some official explanations forthcoming need to be quoted verbatim, and these are as follows:

  • Chinese Prime Minister Wen Jiao Bao: “We will enhance the armed forces capacity to accomplish a wide range of tasks, the most important of which is to win local wars under information age conditions”.
  • China NPC Official spokesperson and Former Foreign Minister Xao Zhing: “China’s limited military power is for the sake of national sovereignty, security and territorial integrity. Fundamentally, it constitutes no threat to other countries”.
  • Professor Su Hao, Chinese Foreign Ministry University, Beijing: “There are new issues (that need funding) like the protection of citizens and investments overseas”

The stress on winning local wars needs to be noted as this is reference to China’s peripheries where territorial disputes abound and which notably includes India. The ‘new issues’ are significant as it is a pointer to China’s expansion of force-projection capabilities without which protection of Chinese citizens and Chinese investments abroad cannot be undertaken. Is China signalling its future intentions of military interventions being undertaken much beyond China’s peripheries?

Analytically, one can advance a number of explanations for China’s increased military expenditures, the chief of which being are: (1) China’s present increase in military expenditure and doubling of that figure by 2015 is predictable in light of the United States strategic pivot to Asia Pacific which China perceives as US fencing-in of China (2) Chinese increased defence expenditures are aimed at upgrading of China’s military capabilities to deter any possible US military intervention against China or making it prohibitive (3) China’s quest for equal strategic weight with the United States would involve China’s military up- gradation to reduce the differential in the US-China military power.

China’s main thrusts in military up-gradation of its capabilities is obviously US-Centric in that China is aiming to dilute US military superiorities which can come in play militarily against China. However, Chinese enhancement in relation to the United States has more than disproportionate strategic impact on India. Contextually, in light of the preceding analysis China’s main thrust areas for sizeable military investments will be concentrated on the following:

  • Second Artillery Corps which is entrusted with the management and operational use of China’s nuclear weapons arsenal and ballistic missiles arsenal. New generation of ICBMs and other missiles with greater emphasis on range and increased accuracy are in the pipeline.
  • China Navy: China’s first aircraft carrier will be operational by the end of this year. China is planning to induct at least four aircraft carriers in the next few years. In terms of force projection, China is inducting amphibious warfare ships and logistics tenders. In terms of Chinese “anti-access and area denial” strategies against any United States possible military intervention, the Chinese Navy is planning introduction of land-based long range anti-ship missiles against US aircraft carriers, greater number of nuclear attack submarines, increased maritime reconnaissance and patrolling, and an overall increase in number of naval combat ships.
  • China Air Force: China has planned a complete turn-over of its fighter aircraft fleet. Introduction of the J-20 Stealth Fighter planes is being speeded up. China has also expressed interest in the acquisition of the Russian SU-35 latest combat aircraft which competed for the Indian Air Force competition also. Up gradation of the bomber fleet and heavy lift strategic transport aircraft akin to the US C-17.-are in the pipeline to augment Chinese force-projection capabilities.

In addition to the above China is investing significantly in space warfare capabilities. China is working on anti-satellite weapons designed to neutralize US spy, targeting, navigation and communication satellites. China’s cyber warfare increasing capabilities have become a strategic headache for the United States military.

Not to be forgotten in terms of China’s military up-gradation is an increase of Chinese nuclear weapons arsenal. So far Chinese nuclear weapons arsenal has not been subjected to any strategic arms limitation treaty or any other scrutiny. The United States while raising hype on Chinese military up-gradations has steadfastly been muted on the subject of the increasing nuclear weapons stockpile of China.

Also to be noted is that China’s arms imports have shown a decrease indicating an increase in greater sophistication of its own R&D technological expertise and expanding defence production capabilities.

India’s National Security: Implications of China Defence Budget 2012 Analysed

India’s national security has consistently stood compromised by the persistent annual double digit increases in Chinese defence expenditure, and China Defence Budget 2012 is no exception. China crossing the $ 100 billion mark in defence expenditure in military plans for 2012 further accentuates and highlights India’s military unpreparedness to meet any possible Chinese military adventurism against India. In military budget comparisons itself, the Indian defence budget at about $36 billion pales into insignificance against China’s earmarked figure of $ 106.4 billion for 2012. The comparison gets more sombre when in comparison China faces no credible military threat from any global power or Asian power whereas India has pronounced military threats from an ever-military rising China and its strategic ally Pakistan, with comparable long and sea frontiers to protect against them—both of them having a record of military adventurism and an expanding nuclear weapons arsenal.

Dispelling notions that one is advocating an arms race with China, it however needs to be noted and commonly understood within India and by Indians is that India’s defence postures against China are grossly inadequate both in terms of conventional military power and nuclear weapons and ballistic missiles. Suffice it to say that India today lacks both nuclear deterrence and conventional military deterrence against China. There is no such thing as minimum credible deterrence. Credible deterrence is relative to the adversaries strike capabilities to be effective.

In this Paper, I have no intention to draw a detailed comparative military balance between a military powerful China and an India where military up -gradations and effective war preparedness are at best given notional attention by the political leadership and apex national security establishment at best, and at worst a strategic obliviousness by both these entities arising from their strategic naivety in benign reading of Chinas military intentions underlying its recurrent and relentless military build-up.

The aim is to educate the India that exists outside the sphere of India’s apex national security decision-makers and the Indian Armed Forces hierarchy which gets disconnected from its political masters by Nehru’s archaic interposing of a strategic culture-deficit civilian bureaucracy of India’s Ministry of Defence.

India in relation to war preparedness to effectively meet ‘The China Threat’ can be said to be in the same repeat Nehruvian strategic mind-set of de-emphasis and under-playing of ‘The China Threat’ as that existed in the run-up to India’s 1962 military debacle foisted on the gallant Indian Army by its political leadership and its civilian bureaucracy. This assertion can be substantiated by Indian TV channels, particularly which stands reported having been pressurised to downplay Chinese intrusions into Indian Territory and not give them prominence.

The Chinese Prime Minister has reiterated this month and is quoted above, that China’s strategic aim is to win local wars under information age conditions and that is significant in relation to India for obvious reasons. Recently a high-powered committee in its report has been quoted in the media as having expressed that China is likely to make a military grab for portions of Ladakh and Arunachal Pradesh. This belated recognition of ‘The China Threat’ against India provides the setting for the succeeding brief examination of our ‘Defensive Postures” against China across the entire military spectrum. It is intended to do so under the following heads (1) India’s Nuclear weapons and missiles arsenal (2) Military postures in Ladakh and Arunachal Pradesh reviewed (3) Indian Air Force-the major voids (4) Indian Navy- Need for wholesale expansion (5) Strategic infrastructure along Himalayan Borders sadly neglected.

India’s nuclear deterrence against China is woefully inadequate both in terms of numbers and reach.Intrnational reports indicate that even Pakistan is outstripping India in this sphere. China accorded delayed grudging strategic respect to India only after the 1998 nuclear weaponization of India. The crying need is to make India’s ICBM operational which so far has been held back by India’s strategic timidity against US pressures. That materialization would greatly offset India’s current lack of dissuasive conventional military deterrence.

Military postures in Ladakh and Arunachal Pradesh have been analysed in fair detail in my earlier Papers. Briefly to be highlighted is that both the Ladakh and Arunachal Pradesh Sectors require force accretions in addition to those planned by an additional mountain division each and integral limited offensive capability. Protecting India’s national sovereignty involves boots-on-the-ground along the Himalayan borders which cannot be replicated by high technology. To that extent the argument of those who advocate a ‘leaner meaner military machine’ does not hold ground.

India’s skies stand naked against Indian military adversaries today with voids of nearly 150 combat fighter aircraft. It took the Indian decision-makers ten years to clear the choice of the next MRCA and even now the agreement is on hold due to Finance Ministry’s budget-deficit balancing. India’s transport aircraft fleet has out-lived its normal operational life and no replacements are in view. The switch to US inventories would carry its own problems. The Indian Air Force both in wartime and in peacetime too needs to be maintained at optimum levels in terms of its authorised aircraft holdings. Case exists for increasing the Indian Air Force combat squadrons to 45 squadrons—a figure that was recommended immediately in the wake of 1962 military debacle.

China has made no secret of its naval ambitions on a strong Chinese naval presence in the Indian Ocean and is working in a focused manner towards that ambition. China’s acquisition of four to six aircraft carriers, nuclear attack submarines and amphibious warfare capabilities, makes a strategic call on Indian decision-makers to embark on a wholesale fast-track expansion of the Indian Navy assets. India cannot afford to await 10-12 years lead times for materialization of naval orders to Indian shipyards. The biggest worry is the slippage allowed in replacement of the current fleet of submarines.

India’s’ strategic infrastructure along the Himalayan borders is sadly neglected The Prime Minister should have made a personal push in this direction as critical lifelines are 3-5 years behind schedule due to inter-ministerial wrangling. After the 1962 War with China some notable projects which needed speedy implementation were a double road artery to Tawang and Bumla in Arunachal Pradesh, a road tunnel under the Rohtang Pass for the alternative road to Ladakh, widening of the Rangli road axis to Jelep La in Sikkim and a major bypass of Gangtok with a highway to Nathu La. Space does not permit greater elaboration.

Lastly India’s decision making elite should answer as to why the Indian aeronautical industry which goes back to around 1943 has not been encouraged to become capable of fast-track development of Indian Air Force requirements of fighter aircraft and transport aircraft within the country.

Can India Ever Militarily Checkmate China?

Strategic analysis would suggest that it should be a pressing strategic imperative for Indian decision-makers to work towards a military checkmating of China to neutralise ‘The China Threat’ and in turn the Pakistan threat assiduously nurtured militarily by China. But the follow-up question is whether India can ever hope to militarily checkmate China and improve India’s security environment?

Going by current trends of the Indian political leadership and the apex national security establishment of investing more on diplomacy than military preparedness to ward off ‘The China Threat’, the analytical answer is a big NO.

Checkmating China by India involves two major questions. Firstly, the political will and strategic audacity of India’s leadership to adopt a ‘hands-on’ approach to checkmate China, not as a strategic subsidiary of the United States but standing tall on its own two legs. Secondly, does India have adequate financial resources to bankroll increased defence expenditure to acquire substantial nuclear and conventional military deterrence to checkmate China from its current strategy in South Asia?

The answer to the first question is that it is unlikely that the existing mind-sets of India’s political leadership and apex national security establishment would undergo a change. Both these entities are likely to concentrate all strategic decision-making with themselves bypassing institutional inputs. Also keeping the Indian Armed Forces hierarchy out of apex level national security decision-making and more vitally nuclear weapons decision-making by these two entities leads to ‘mentally challenged’ strategic policy decisions. Political will and strategic audacity therefore cannot blossom in such a truncated decision-making environment.

The second question pertains to financial resources to bankroll sizeable defence expenditure to acquire substantial nuclear and conventional military deterrence against China. Financial resources are no longer a problem today for India. The Indian problem on increased defence expenditure is that massive amounts of the Indian budget are earmarked for non-productive political-populist schemes like NREGA and other subsidies which lead to substantial budget deficits and to offset which the Defence Budget becomes the notable casualty in terms of being asked to surrender thousands of crores of rupees every year before the presentation of the Budget.

The existing mind-set of underwriting wasteful expenditures on political-populist measures at the cost of Indian national security requires a complete transformation of policy approaches.

So the final answer is that India will never be able to militarily checkmate China’s enhanced military postures impinging on Indian security. If India’s political leadership under different political dispensations had been imbued with the will of checkmating China, they would not have allowed India’s slippage in its defensive postures and war preparedness, and kept pace with China’s constant military expenditure increases, not in an arms race, but in a sincere effort to not to allow the strategic and military chasm between China and India in terms of nuclear and conventional military deterrence differentials to grow.

Concluding Observations

China’s defence budgets every year have registered double-digit increases over the last two decades. This has facilitated China to emerge as the dominant military power in Asia and a contender capable of a serious challenge to United States global military predominance. China has achieved this posture by spending significant amounts on military expenditure facilitated by a booming economy.

India in contrast also has a booming economy but it has been niggardly in its defence expenditures as defence expenditure is made subservient to political-populist schemes. Capital acquisition of critical military hardware are delayed for decades due to political indecision, bureaucratic lethargy and other considerations which view capital acquisitions of critical military equipment from abroad with extraneous perspectives.

Resulting from the above is the stark strategic reality that India will not be able to militarily checkmate China. In 1962, China militarily humiliated India due to lack of Indian defence preparedness in the preceding two decades. In 2012, with existing mind-sets at the highest-level in India and the slippage that has taken place in defence outlays in the last two decades, India risks a similar repeat 1962 performance of not a military debacle (thanks to the Indian Armed Forces used to making-do with military hardware available with them to defend India) but of a “strategic diminishment” of India on the global stage which India aspires to ascend.

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SAAG is the South Asia Analysis Group, a non-profit, non-commercial think tank. The objective of SAAG is to advance strategic analysis and contribute to the expansion of knowledge of Indian and International security and promote public understanding.

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