Pakistan is expected to increase its military spending in the years to come by several billion dollars, a recent report suggests.
As per the “Pakistani Defense Market – Attractiveness, Competitive Landscape and Forecasts to 2024,” the country is expected to spend $48.5 billion from 2020 to 2024 on defense.
The amount is around $6 billion more than what it invested in the past four years – from 2015 to 2019. The move is mandatory to manage internal instability and bolster its defense capabilities concerning India, suggests the report.
Between 2015 and 2019, the US military aid was halted and thus the country’s defense budget increased at a sluggish rate – not to mention the deteriorating economic situation as well.
Pakistan invested $7.6 billion in the defense sector in 2015 with a compound annual growth rate (CAGR) of 0.69 percent, which jumped up to $7.8 billion in 2019.
In the last four years, the country’s average capital expenditure allocation per annum remained at 36.8% of the total defense budget, while its revenue expenditure allocation was 63.2%.
In the next four years, the country is expected to push the average capital allocation for military hardware up-gradation to 37.8 percent.
Pakistan suffered a massive setback when the US halted arms supply in the aftermath of the conflicts between the two countries over Afghanistan. To recover from that, the country’s defense industry increased its indigenous capabilities to fulfill a majority of the national requirements. However, it still seeks China’s help for technologically advanced defense equipment.
The report suggests that the Pakistani export market will gradually grow over the forecast period on the back of its high-quality indigenous defense systems.