Article Posted on : - Mar 04, 2010

The National Day of the People's Republic of China. A File Photo.

BEIJING (PTI): China Thursday announced a 7.5 per cent hike in defence spending in 2010 boosting its military budget to USD 77.9 billion, almost double that of India.

But the hike was the smallest increase in defence expenditure in more than two decades and could be a fallout of financial constraints.

The increase will be used to enhance China's military capabilities and ability "to meet various threats" Xinhua quoted Li Zhaoxing spokesman for China's Parliament, the National Peoples Congress as saying.

"China is committed to peaceful development and military posture that is defensive in nature" Li said after the budget was placed before the Parliament.

He claimed that China's defence spending accounted for just 1.4 per cent of the GDP as compared to more than 4 per cent in US.

China has the world's largest standing army of more than 2.3 million soldiers in arms and Li said that the bulk of the expenditure would go towards salaries and improving living conditions of the troops.

But, economic experts say that China has never been transparent on military spending with estimates of the total amount ranging upto twice or more of what Beijing claims.

China's rapid military build up over the years and the acquisition of cutting edge jet fighters, missiles, warships and submarines have raised suspicions and concerns among its neighbours in the far east as well as in Washington, Tokyo and New Delhi.