As late as 2000, India’s spending on defense, at $15.9 billion, outstripped China’s official military budget of $14.5 billion, although China’s actual expenditure that year was estimated at three times that amount. The disparity has only increased with the growing resource gap between China and India. In its most recent budget, the Indian government’s spending on defense stands at $37 billion (excluding military pensions), keeping it on track to be the fourth-largest defense spender by 2020, surpassing Britain, France, and Japan. But such expenditure increases have not even kept pace with the overall growth of India’s economy, let alone the military modernization of its competitors. Defense now accounts for just 1.7 percent of India’s GDP, which is less than in many European countries, and down from almost 3 percent in the late 1990s. And while China’s defense budget this year is more than three times larger, its actual spending will undoubtedly be even higher.
As for the threat environment, the question is not whether India is able to compete man-for-man, dollar-for-dollar, and gun-for-gun with its principal adversaries, but whether it is in a position to deter their adventurism. Nuclear weapons have arguably played a stabilizing role in this regard: The prospect of India becoming embroiled in a conventional war with either China or Pakistan since its 1998 nuclear tests has become ever more remote. It also helps that India enjoys increasing numerical and technological superiority vis-à-vis Pakistan, although that has so far failed to completely deter terrorist attacks emanating from that country.
China is another matter altogether, given its rapid rise and military modernization. Yet the last few years have seen the Indian military steadily rebalance toward its northeastern frontier. This shift has seen India redeploy its frontline combat aircraft to bases in the northeastern state of Assam,increase the range of its strategic missiles, and set up two new army divisions along the Chinese border. In 2010, India’s national security advisor hinted that the country was amending its no-first-use nuclear doctrine, a move widely interpreted as a signal aimed at China. And last month, India’s defense ministry approved the creation of a mountain strike corps, an 89,000-strong force capable of offensive operations against Chinese territory.
While none of this seems to suggest that India is standing idly by in the face of China’s military modernization, the release of the two countries’ military budgets in such quick succession points to a fascinating divergence. If anything, it is New Delhi’s Central Secretariat — rather than Beijing’s Zhongnanhai — that appears to have taken to heart Deng Xiaoping’s famous dictum: “Hide your strength, bide your time, and do what you can.” Perhaps it is no surprise then that India, unlike the other Asian giant to its north, finds it unnecessary to constantly assuage its smaller neighbors about the veracity of its peaceful rise.