Increasing Chinese defense budget alarms India

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BEIJING, March 5 (UPI) -- In 2012 China's defense budget was $106.4 billion, more than three times when neighboring India budgeted and perhaps setting off a defense funding battle.

The Chinese government maintains that the expenditures will help stabilize Asia.

China's National People's Congress spokesman Fu Ying, at a news conference in Beijing, said China's defense expenditures were a force for regional peace.

"China's peaceful foreign policies and its defensive military policies are conducive to security and peace of Asia," Fu said. "It's not good news to the world that a country as large as China is unable to protect itself."

Referring to China's dispute with Japan over the disputed Senkaku Islands

Fu added, "When some countries make provocation, we should make a resolute response and handle these matters in timely manner to send clear signals."

Many international analysts assert that China's annual defense budget is far higher than Beijing announces, although the Chinese government steadfastly maintains that the published statistics are the actual amount.

Adding to regional anxieties, in addition to its announced defense expenditures China is allocating more than $110 billion annually for internal security, a figure analysts say is designed not only to allow police to maintain tight control over people, but in unsettled border regions such as Xinjiang and Tibet, the Press Trust of India reported Monday.

In partial response, despite the uneven recent progress of India's economy, on Feb. 28 Indian Finance Minister P. Chidambaram announced that India this year will increase defense spending when presenting the government's budget to $37.45 billion, despite concerns that the stuttering growth of the Indian economy could negatively affect the country's military.

Indian Defense Minister A.K. Antony said he was pleased that the country's military budget had been spared possible cuts, adding: "Factoring in the current economic scenario, he (Chidambaram) has been fair to the defense sector also by increasing the budget and giving an assurance that should there be any urgent need in future the same would be provided.

"Taking into account the difficult economic situation both at home and abroad, the finance minister has done a good job. The measures that he has outlined for the rejuvenation of the economy while ensuring inclusive growth are indeed commendable."

Among the items on the Indian Defense Ministry's shopping list are 126 French Rafale fighter jets for $12 billion to replace the Indian air force's increasingly obsolescent fleet of Soviet-era fighters, along with 400 combat helicopters as well as artillery, drones and electronic warfare systems.

But New Delhi may yet face the classic "guns and butter" issue, as the "Economic Survey 2012-13," presented to the Indian Parliament a day before the government's budget's presentation projected that the Indian economy was expected to grow at a decade low level of 5 percent in the current 2013 fiscal year, down from its peak of 9.3 percent in 2010-11.