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Facing US and Taiwan, China Strengthens its Arsenal and Increases its Military Budget for 2025.
On March 5, 2025, China announced a 7.2% increase in its defense budget for the year, bringing total military spending to approximately $245 billion. The announcement, reported by the Associated Press following the first session of the annual meeting of the National People’s Congress, highlights Beijing’s commitment to strengthening its military capabilities amid growing tensions with the United States and other regional powers. With this increase, China, already the second-largest military spender after the United States, further advances its strategic ambitions.
In recent years, China has reinforced its military presence in the South China Sea, asserting territorial claims over nearly the entire contested maritime region, despite opposition from other claimant states (Picture source: China MoD)
Although the official figure is significant, the U.S. Department of Defense estimates that China’s actual defense spending may be at least 40% higher due to additional military-related expenditures included under other budgetary categories. Officially, the Chinese government attributes this increase to enhanced military training, equipment maintenance, and improvements in the living conditions of the two million personnel of the People’s Liberation Army. However, analysts emphasize that the expansion of naval forces, strategic units, and ground forces is a primary driver of this spending, particularly in response to rising tensions with the United States, Australia, and neighboring countries.
In recent years, China has reinforced its military presence in the South China Sea, asserting territorial claims over nearly the entire contested maritime region, despite opposition from other claimant states. Additionally, it has conducted a series of large-scale military exercises involving missile forces, the navy, and the air force around Taiwan. These operations aim to demonstrate Beijing’s readiness to act militarily against the island, which it considers part of its territory. The Joint Sword 2024B exercise exemplifies this strategy, showcasing China’s ability to encircle and isolate Taiwan in the event of a conflict.
Alongside these maneuvers, China is undergoing a significant modernization of its nuclear forces to strengthen its strategic position relative to the United States and Russia. The objective is to build a "world-class" military by the middle of the century, aligning with the broader vision of the People's Republic of China as a modern socialist power. This modernization includes upgrades across all three components of its nuclear triad. The DF-5 intercontinental ballistic missiles (ICBMs), which use liquid fuel and can carry multiple warheads, are undergoing improvements, while new classes of nuclear-powered ballistic missile submarines and strategic stealth bombers are being developed.
China’s strategic air force has also seen advancements with the introduction of the H-6N bomber, capable of in-flight refueling and launching air-launched ballistic missiles. This aircraft was publicly displayed during the National Day parade in 2019, marking a notable step in China's long-range strike capabilities. Additionally, the country has deployed DF-26 missiles, which can carry both nuclear and conventional warheads, with a maximum range of 5,000 kilometers and an improved targeting accuracy within 100 meters.
At the naval level, China has commissioned two new Type 094 nuclear-powered ballistic missile submarines, ensuring the ability to maintain continuous deterrent patrols in open waters during peacetime. These submarines are armed with the modernized JL-3 submarine-launched ballistic missiles, increasing the range and reliability of China’s sea-based nuclear deterrence. Intelligence estimates indicate that China’s nuclear arsenal could surpass 1,000 warheads by 2030, primarily consisting of an expanding inventory of ICBMs capable of reaching the continental United States.
China’s military expansion also includes the rapid growth of its strategic missile forces. Nearly 300 missile silos have been constructed for the DF-31 and DF-41 ICBMs, while additional brigades equipped with DF-26 missile launchers, in both nuclear and conventional configurations, are being established. The ground-based missile forces are expanding with new mobile ICBM brigades, increasing the number of launchers per unit from six to twelve. Since 2021, China has been constructing an extensive network of ICBM silos in the Gansu province and the Inner Mongolia Autonomous Region. Satellite imagery and analysis from the James Martin Center for Nonproliferation Studies have confirmed the existence of this large-scale missile infrastructure, comprising at least 120 silos.
Intelligence reports suggest that China is also developing lower-yield nuclear warheads, providing more flexible response options than the country’s existing high-yield weapons. These conclusions are based on Chinese military publications, assessments by defense experts, and policy directives issued by President Xi Jinping.
Against the backdrop of growing geopolitical competition, the latest increase in China’s defense budget signals the country’s intent to continue military modernization and expansion. While Beijing emphasizes the defensive nature of its military posture, the scale and scope of these developments are closely monitored by the United States and its allies, given their broader strategic implications.