Article Posted on : - Mar 05, 2013

BEIJING (PTI): China on Tuesday hiked its defence budget by 10.7 per cent to USD 115.7 billion well above this year's Indian defence spending of USD 37.4 billion.

The hike in the defence spending was announced as the Chinese legislature, the National People's Congress (NPC) opened its annual session, which this year also marks the once-in-a-decade power transfer.

As per the budgetary papers placed at the NPC, a sum of 720.168 billion Yuan was allocated for defence, which at the current exchange rate amounted to USD 115.7 billion.

The newly elected leader X Jinping and his fellow leaders would formally take over power from old guard headed by President Hu Jintao in the course of next ten days.

The budget proposals were announced by the outgoing Premier Wen Jiabao who presented a lengthy work report on the decade old achievements of his government.

The focus was mainly on the defence budget as China had officially allocated USD 106.4 billion last year making it one of the top defence spenders in the world.

The ten per cent hike this year comes when China is rapidly modernising its armed forces in the back drop of deepening standoff with Japan over the disputed islands as well as differences with several South Asian Countries over the South China Sea.

China has already launched its first aircraft carrier last year as well as several versions of new jet fighters including a stealth fighter bracing to deal with big US military push into Asia pacific.

Playing down the steady increase in China's defence budget, NPC spokesperson Fu Ying told a media yesterday that China's defensive military policies played a "core role" in maintaining peace and stability in Asia.

"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," Fu said.

Acknowledging that China's rise raised concerns in Japan and other countries, Fu said Beijing beefed up its maritime security and opted to send its ships to patrol the waters of disputed islands in East China Sea after Japan violated consensus agreement and purchased them from private parties.

"When some countries make provocation, we should make resolute response and handle these matters in timely manner to send clear signal," she said.

Fu said compared with many other parts of the world, Asia has been largely peaceful after the end of the Cold War, which created a favourable environment for development.

"That is why Asia is so attractive now," she added.