Context: At the recent North Atlantic Treaty Organisation (NATO) summit in June, NATO members pledged to increase their military spending to 5% of their GDP by 2035, a significant jump from the previous target of 2%.
Relevance of the Topic: Prelims: SIPRI Military Expenditure data.
Mains: Effects of Rising Military Expenditure.
According to the Stockholm International Peace Research Institute (SIPRI)
- Global military spending in 2024 hit a record $2.7 trillion, the highest year-on-year rise (9.4%) since 1988.
- Top Five Military Spenders are:
- The US ($997 billion)
- China ( $314 billion)
- Russia ($149 billion)
- Germany ($88.5 billion)
- India ($86.1 billion)
- In terms of GDP percentage (excluding countries at war such as Russia, Ukraine and Israel), the highest spenders include:
- Saudi Arabia (7.3%)
- Poland (4.2%)
- The US (3.4%)
- According to the Global Peace Index, in 2023, militarisation increased in 108 countries and the year saw the highest number of conflicts since World War II.
- All of the NATO members (32) combined spent $1,506 billion, which makes it around 55% of global military spending. There is a concentration of spending in a few countries.
Military Expenditures in India:
- India is the fifth-largest military spender in the world, with an annual defence budget of $86.1 billion.
- Military spending stands at 2.3% of India’s GDP. In comparison, the Public Health spending is only 1.84% of GDP, far below the 2.5% target of the National Health Policy.
- Following Operation Sindoor, the government has approved an additional ₹50,000 crore for emergency defence procurement. This is over and above the regular ₹6.81 lakh crore annual defence allocation. In contrast, Ayushman Bharat, India’s flagship health insurance scheme covering 58 crore people, received just ₹7,200 crore in 2023-24.
Effect of Rising Military Expenditure:
- Loss of Post-Cold War Peace Dividend: After the Cold War ended (1991), global military spending declined significantly, dropping to its lowest level of 2.1% of world GDP by 1998. The current wave of remilitarisation risks undoing the post-Cold War peace dividend, where falling military spending allowed greater investment in health, education, and development.
- Crowding Out of Social Sector Spending: Higher military budgets reduce funds for health, education, welfare, and poverty alleviation. Example: Spain refused NATO's 5% target, saying it would cut welfare spending by €300 billion. Study of 116 countries shows rising defence spending reduces public health investment, especially in middle- and low-income nations.
- Hampers SDG Progress: Redirects funds from Sustainable Development Goals (SDGs) like ending poverty, ensuring health and education, combating climate change etc.
- Increases Climate Burden: According to a study by the Conflict and Environment Observatory, if NATO’s defence spending reached 3.5% of GDP, greenhouse gas emissions would increase 200 million tonnes annually.
- Weaken Peace-Building Institutions: Rising military expenditure diverts global resources away from peace and development, leaving institutions like the United Nations severely underfunded. The UN's latest $44 billion budget has received only $6 billion in six months, forcing a cut to $29 billion despite growing humanitarian needs.
- Humanitarian Consequences: Cuts to foreign aid (e.g., USAID closed down by Trump) may cause 14 million additional deaths by 2030, one-third being children.
- Hurts Poor and Developing Countries: Poor and developing countries are forced to match defence spending trends, harming basic services. Lebanon spent 29% of GDP, Ukraine 34% on defence.