Pakistan’s defense expenditure outlay will continue to grow and is expected to reach US$12.4bn by 2025 with the primary focus to build military capability to counter incursion of external forces despite a struggling economy, says GlobalData, a leading data and analytics company.

GlobalData’s report, ‘Pakistani Defense Market – Attractiveness, Competitive Landscape and Forecasts to 2025’, reveals that the military spending of Pakistan, as a percentage of GDP, is expected to increase from the present 3.9% to 5.4% in 2025.

Pakistan’s economy has been struggling prior to COVID-19 and the pandemic has further worsened the situation. The country was forced to seek help under the Extended Fund Facility (EFF) program of the International Monetary Fund (IMF) due to its fiscal and current deficit problem.

Pakistan’s economic decline has not deterred its strategic focus to contest militarily with India and thereby, increase defense expenditure. Unlike other countries in South Asia, COVID-19 has not been a factor for the change in the defense expenditure. Thus, Pakistan’s defense expenditure continues to increase and its strategic focus to counter the external incursions hasn’t changed. This has resulted in the upgrade of the indigenous Al Khalid main battle tank to the Al Khalid-I standard, speeding up the production of JF-17 fighter jet in China and may procure Chinese Z-10 attack helicopters.

Vardhani Pitchuka, Aerospace Defense and Security Analyst at GlobalData, says: “Pakistan’s strategic focus and the push for modernization of its defense forces are likely to come under greater scrutiny of all parties involved in its debt and may add to further restrictions to the access of arms from the West. However, countries like China, with an interest in maintaining a dependable partner, may provide the modernization through special schemes while they maintain their economic programs in the country. These developments will need to be watched to understand the stability and accessibility to this market.”