SNA (Tokyo) — Japan plans to massively increase its defense budget over the next four years, climbing into the ranks of the highest-funded national militaries. Depending on developments–and future currency exchange rates–there is even the possibility that Japan could soon rank as the No. 3 military in the world as measured by its budget.

The main reason for the military budget increase is Tokyo’s concern that China might pose a future threat to Japan’s security. Prime Minister Fumio Kishida has cited what his country views as incursions by Chinese ships into waters around the disputed Senkaku-Diaoyu islands, a tiny and uninhabited Japan-controlled archipelago also claimed by China and Taiwan.

Another reason for the military budget increase is threats emanating from North Korea, particularly in light of its nuclear weapons program and its missile tests near and sometimes over Japan.

At the end of March, North Korean leader Kim Jong-Un was photographed inspecting new nuclear warheads as his government announced that it intends to continue ramping up production of weapons-grade nuclear materials.

Tokyo argues that the “severe situation” in the region requires offensive missile arsenals, which it presents as being a “counterstrike capability.” The government plans to purchase 500 US-made Tomahawk missiles. Over ¥211 billion (US$1.6 billion) is being budgeted for this acquisition.

Overall, Japan’s annual military budget is expected to reach a figure near ¥11 trillion (US$83 billion) by FY2027 should Kishida’s target of spending around 2% of the gross domestic product (GDP) on the military be realized.

According to the Stockholm International Peace Research Institute (SIPRI), Japan spent US$54.1 billion on its military in 2021, ranking 9th among all nations in the world.

Like all such estimates, SIPRI puts US military spending in a class of its own with an enormous budget of about US$801 billion in 2021. No one expects that the United States will lose its top ranking in the foreseeable future.

For its part, China has a clear hold on the No. 2 ranking in terms of its military budget. SIPRI put the figure at US$293 billion in 2021; Beijing recently announced its intention to increase its budget by about 7.2% annually.

After these top two comes a group of about seven nations with military budgets of a comparable size. Any one of these countries could potentially edge out the others to have the No. 3 budget in the world come FY2027.

One of these is Japan. While Kishida has floated his notion of doubling the nation’s military budget, it is unclear whether political and economic conditions will actually allow such a massive increase to be implemented. Additionally, fluctuations in the Yen exchange rate could become a major factor in how Japan measures up against other countries in future years.

Still, Japan’s mostly likely rival for the No. 3 spot may be the United Kingdom. SIPRI put UK annual spending at US$68.4 billion in 2021. During the short-lived Liz Truss government, there was talk of raising the military budget to 3% of GDP by 2030. If realized, this would almost certainly make London the world’s No. 3 military spender. However, with the more budget-conscious Rishi Sunak administration now in place, as well as political and economic uncertainty in the country more generally, there is ample reason to doubt that the United Kingdom will approach this target.

India is another country which could hold the No. 3 spot in FY2027, and in fact it holds that ranking now. In 2021, India had a military budget of US$76.6 billion, according to SIPRI. That said, current policies in New Delhi suggest that there will not be major increases in the next few years. Forecasts suggest that it will still be under US$85 billion by FY2027.

But a major increase in India’s military spending should not be ruled out. This could especially be the case if New Delhi perceives an increasing military threat from its northern neighbor, China, with which it has active territorial disputes.

Ranking 6th in 2021 was France, and according to President Emmanuel Macron, military spending should be significantly increased. However, his view is not universally accepted within the country, and he is already at odds with much of the French population over government spending priorities.

Germany is in a similar situation to France. While there has been a great deal of criticism about the capabilities and readiness of the German Bundeswehr, as well as talk of major military budget increases, the domestic political situation is unsettled. Predictions are difficult to make. At any rate, if Germany does spend more on its military, it does not at this point appear likely to become a dramatic hike.

Rounding out the top level countries are Russia and Saudi Arabia, though neither of them are considered serious candidates to raise military budgets to levels that would put them in the No. 3 position.

While Russia is currently engaged in a major war with Ukraine, the relatively small size of the Russian economy and declining population does not put it in the same league as some of the previously mentioned nations.

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