India's military spending rose 8.9% to $92.1 billion in 2025, elevating it to the rank of the world's fifth-largest military spender, according to data published by the Stockholm International Peace Research Institute on April 27, 2026. The report placed global military expenditure at $2,887 billion for the year, up 2.9% in real terms from 2024 and the 11th consecutive annual increase.

The context behind India's rise is significant. The jump followed Operation Sindoor and the Pahalgam terror attack of May 2025, which set off an aggressive procurement drive covering drones, counter-drone systems, air defence platforms and a range of modern military hardware. Pakistan's spending also increased, by 11% to $11.9 billion, though it remains outspent by India by more than seven to one.

The data comes from the Stockholm International Peace Research Institute, which publishes an annual report tracking military expenditure worldwide. The headline finding: the United States, China and Russia together accounted for $1,480 billion, 51% of the global total.

The US dip and what comes next

Despite topping the global rankings, American military spending actually fell in 2025. At $954 billion, the figure was down 7.5% from 2024, largely because no new financial military assistance for Ukraine was approved during the year, unlike the previous three years, when a combined $127 billion was cleared.

That said, the US continued investing in nuclear and conventional capabilities to maintain dominance in the Western Hemisphere and deter China in the Indo-Pacific, both identified as priorities in the country's new National Security Strategy. SIPRI noted that 2026 data is expected to show a steep reversal, driven by the costs of the US-Iran war.

Europe: The sharpest surge since the Cold War

Europe was the biggest driver of the global increase. Regional expenditure climbed 14% to $864 billion, with NATO members' rearmament driving the sharpest annual growth in Central and Western Europe since the end of the Cold War.

Russia's spending rose 5.9% to $190 billion, representing a military burden of 7.5% of GDP. Ukraine, now the world's seventh largest military spender, raised its outlay by 20% to $84.1 billion, equivalent to 40% of GDP. The 29 European NATO members collectively spent $559 billion, with 22 of them allocating at least 2% of GDP to defence.

Germany led the group with spending up 24% year-on-year to $114 billion, crossing the 2% GDP threshold for the first time since 1990 and reaching 2.3% in 2025. Spain's military budget rose 50% to $40.2 billion, taking its military burden above 2% of GDP for the first time since 1994.

Asia and Oceania: Largest increase since 2009

Military expenditure across Asia and Oceania totalled $681 billion in 2025, up 8.1%, the region's largest annual jump since 2009. China, the world's second-largest military spender, increased its outlay by 7.4% to $336 billion, marking its 31st consecutive year-on-year rise as its military modernisation programme continued uninterrupted. SIPRI noted that a renewed anti-corruption campaign in military procurement did not appear to constrain spending.

Japan's military expenditure rose 9.7% to $62.2 billion, equal to 1.4% of GDP and the highest share since 1958. Taiwan increased spending by 14% to $18.2 billion, or 2.1% of GDP, its largest annual rise since at least 1988, as the People's Liberation Army intensified military exercises around the island.

Pakistan's military spending rose 11% to $11.9 billion, widening the gap with India, which outspends its neighbour by more than seven to one.

The Middle East: Mostly up, Israel down

Military expenditure across the Middle East was estimated at $218 billion in 2025, marginally above 2024 levels. Israel's spending fell 4.9% to $48.3 billion, reflecting lower intensity in the Gaza conflict following the January 2025 ceasefire with Hamas, though its outlay remains 97% higher than in 2022.

Turkey's military budget rose 7.2% to $30 billion, driven in part by operations in Iraq, Somalia and Syria. Iran's spending fell for the second consecutive year, down 5.6% in real terms to $7.4 billion, a decline SIPRI attributed to annual inflation of 42%, even as nominal spending rose.

Published on: Apr 28, 2026 8:01 AM IST