On March 5, China declared one of its lowest increase in
defence budget since it started modernization under Revolution in Military
Affairs (RFA). The increase of 7.6 percent, taking defence spending for 2016 to
approximately US $ 146 billion, is the first single digit increase in the last
six years.
Analysts are asking why this drop in
the budget given the fact that China’s last defence white paper emphasised
stronger defensive and offensive postures in the immediate region and extended
military protection to Chinese interests overseas. Pertinent questions have
been asked and very plausible expiations have also been written. It is near
impossible for any outsider to get a peek into the brain of the Chinese Communist
Party at Zhongnanhai in Beijing. The Chinese media and intellectual experts who
had been given a little room for independent comments have been shut tightly by
President Xi Jinping. The media has been dictated to publish “What is good for
China” and “What is good for the Party”. In brief, this means media and
commentators have to be ideologically and politically correct. Any deviation
from this line attracts punitive action. Hence, analysts have to depend on
peripheral information. But analysts have done a pretty good job.
It is quite possible that the
increase in defence expenditure has been pruned because of economic slowdown.
Fall in GDP growth will have to be shared by all sectors including defence.
There are increasing challenges from rising unemployment. At this juncture when
the party is trying to reassert its control over the people and the country,
social unrest has to be avoided at any cost. Though Party Chief and President
Xi Jinping appears to have liquidated most of his political enemies, they have
not vanished. Xi’s anti-corruption campaign has targeted and eliminated most of
his powerful enemies in the party and the PLA, there would hardly be any
official high or low who has not been touched by corruption in his or her
career. He would be looking back over his shoulders all the time. Hence, he
needs finances to try and fill social inequities.
For decades China stuck to its
foundational strategy of four modernizations, that is “Agriculture, Industry,
National Defence and Science and Technology”, in that order of priority. One
has not seen any alteration of priority in the four modernizations, though this
strategy does not seem to be in vogue in the speeches of leaders.
The agricultural sector has
stabilised, but the same cannot be said about industry and S & T. Although
China is called the workshop of the world, it is also called “sweat shop” of
the world. It floods the world, especially the developing and underdeveloped
countries with low end and under-priced goods, it is now feeling the pinch of
remaining at that level for a long time. This would take the sheen off Xi
Jinping’s “Chinese dream”. Falling exports have to be addressed. It would
require heavy injection of finances. Cutting edge S & T has to give inputs
to industry. This is still behind the level that Chinese leaders want urgently
to achieve. On the other hand, S & T for defence is a separate section.
According to some American reports,
both from government and non-government analysts, Chinese cyber-attacks across
the spectrum is devoted to steal not only trade secrets but also high end
technology. The Chinese, of course, deny this. But this is the cheapest route
to acquire high end technology.
Every route, however, costs money
big or small. China may have also reduced the defence budget to assuage the
rising concerns of neighbours in the Asia Pacific region especially those who
have territorial disputes with China. It is, however, unlikely that this ploy
will work.
China’s actions in South China Sea
and East China Sea defeat any intention, if there was any, to calm the nerves
of its neighbours. It has become highly assertive, if not threatening, in its
neighbourhood. Its defence plans remain opaque, and keeps room for propaganda
manipulations.
China’s plans to reduce its military
by three hundred thousand personnel will release a substantial amount of
expenses for the budget. Pension and rehabilitation expenditure does not come
from the military budget. It sheds unnecessary flab from the military. At the
same time the military is not rendered any weaker. It has established
civil-military amalgamation for any emergent situation. Finance for such an
eventuality will come from budgets of other ministries engaged in such an
exercise.
China’s military export earnings do
not figure in foreign trade. They are ploughed back into the defence
expenditure, and this is not an insignificant amount.
Whether the anti-corruption campaign
in the PLA will release a sizeable chunk from the budget allocation is
questionable. In terms of individual gains from corruption look large, it
really has little effect on the overall budget. Corruption made the army
unprofessional and negatively affected the fighting capacity in some manner.
The crux of the anti-corruption campaign was political.
According to Zhou Qiang (March 13),
Chief Justice of China’s Supreme Court, China will set an International
Maritime Judicial Centre to “safeguard China’s sovereignty, maritime rights,
and other core interests”. Zhou was addressing delegated to the ongoing annual
NPC conclave. This move appears to have been taken to counter the action taken
by the Philippines to approach the UN law of the seas conference (UNCLOS) to
arbitrate in the South China Sea dispute. But that is not the only point. It
appears that China is planning to shift the responsibility of its claimed
maritime possession to maritime security establishment. This will try to give a
more benign image to China’s position. From the military expenditure point of
view this will release a big amount for the military’s modernization and
growth.
The defence budget does include
research and development, nuclear weapons development and foreign acquisition.
The real budget is estimated to be well above US $ 200 billion.
China claims its defence expenditure
is far below that of USA, which is true. The US Defence Department budget for
2016 is US $ 573 billion. On the other hand, China’s declared defence budget is
more than that of India, Japan and South Korea put together. In fact, China’s
defence budget dwarfs the rest of Asia. A review of military strategies between
China and the US will make it clear that the agenda of the two are very
different. The US has a global agenda, while that of China is more regional but
gradually expanding outward to secure its interest as far as Africa.
Since 2008, China drastically
reorganised its military planning. A notable aspect of this reorganization was
“aggression with impunity”. This was particularly visible in the South China
Sea over sovereignty of the Spratly group of islands, and the Senkaku islands
in East China Sea in the case of Japan. India has been the recipient of this
aggressive behaviour along its unresolved borders with China in recent years.‘
In the period between 2010 and 2016
China invested a lot in building its military power. Long term out lays
especially in the navy, missiles and air power. China plans at least four or
five aircraft carriers. After refurbished Liaoning, a second carrier is under
construction indigenously. The DF-21D carrier killer missile have become
operational. New inter-continental ballistic missiles are on the plat form.
While Russian Sa series aircraft remain as frontline fighters, the JF-15 and
J-20 are no mean machines. These need no new funding at the moment.
The problem, however, is that most
western analysts compare China with the US. The Chinese also do so to keep the
focus out of the region. The fact is Asian countries, especially those who have
territorial disputes with China and those perceived by Beijing to be in the US
camp on its periphery, are becoming increasingly vulnerable. For India- Do not
be complacent.
*The writer is a New Delhi based
Strategic Analyst
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