Japan Seeks Record Defense Budget to Deter China

Japan Seeks Record Defense Budget to Deter China

The News

Japan's Defense Ministry is asking for a record 8.9 trillion yen — about $55.6 billion — to arm itself with attack drones, long-range missiles and artificial intelligence as it braces for a more aggressive China.

The ministry disclosed the details of its request for the coming fiscal year on Monday, according to The Independent.

It is part of a wider spending surge: Reuters, citing Nikkei, reported that Japan's total fiscal 2027 budget requests have swollen to a record — Reuters put the figure at $896 billion — under Prime Minister Sanae Takaichi's growth plans.

The Wall Street Journal reported that even so, the pace of Japan's increases "might look slow to Washington."

What Japan Wants to Buy

The preliminary 8.9 trillion yen total is only a small increase from the 8.8 trillion yen ($55 billion) requested for the current fiscal year, and officials say it will climb once Takaichi's government approves a new security and defense strategy later this year.

The ministry says it wants to "drastically strengthen its deterrence and response capability" by adapting to new forms of warfare, pointing to Ukraine's use of drones.

For the fiscal year beginning in April 2027, it is requesting an unspecified sum to buy unmanned attack drones that can be launched from the air or from under water, to be paired with long-range cruise missiles for cheaper counterstrikes.

It also wants to develop hypersonic missiles launched from submarines, and it has already fortified Japan's southwestern islands with longer-range missiles and interceptors.

On the software side, the ministry plans an integrated AI platform for command and control — including assessing battlefields and choosing targets — plus a next-generation "AI orchestrator" to run multiple AI systems, and a "Defense Ministry cloud" for sensitive data and emergency communications. It did not specify what any of that will cost.

Officials say uncrewed weapons could also offset a shrinking pool of military recruits as Japan's population ages. Experts told The Independent that building fully homemade drones will be hard, because Japan's commercial drone market is dominated by Chinese imports.

Timeline

2022

Japan sets a five-year defense strategy and begins doubling defense spending toward roughly 2% of GDP, expanding the Self-Defense Forces' offensive role to counter China.

Current fiscal year

The Defense Ministry requests 8.8 trillion yen, about $55 billion.

Monday, Aug. 31, 2026

The ministry discloses details of an 8.9 trillion yen ($55.6 billion) request for the next fiscal year, and Reuters reports that total government budget requests for fiscal 2027 hit a record.

Later in 2026

Takaichi's government is expected to adopt new security and defense strategies, after which the defense figure is expected to rise significantly.

April 2027

The fiscal year covered by the drone purchases begins.

Reactions

Beijing has attacked Japan's buildup as "new militarism," according to The Independent.

Japanese officials frame the plan as cost control as much as firepower, arguing that mass-produced, low-cost uncrewed weapons cut spending, "minimize casualties" and build a more efficient air defense network.

In Washington, the read is different. The Journal reported that the Pentagon's allies-should-spend-more push makes Japan's incremental increases look sluggish, even as Tokyo asks for its biggest defense budget ever.

Japan's arms makers are the quiet winners. Profits at Mitsubishi Heavy Industries, Kawasaki Heavy Industries and IHI Corp. have risen as Japan rearms and expands weapons exports, though the industry overall still lags because Japan's constitution limits force to self-defense. Dozens of companies have quit the business over decades, citing thin profits and reputational risk from making lethal weapons.

What's Next

The request is a starting number, not a final one. The real total lands after Takaichi's cabinet signs off on the new security and defense strategy later this year, which will fill in the many line items the ministry left blank.

Watch three things: whether Tokyo buys American AI for its command systems or insists on homegrown models; whether the state-owned, contractor-operated factory plan the ministry requested gets funded; and whether Washington publicly presses Japan to move faster than 2% of GDP.

More

To keep production lines from going dark, the ministry asked for an unspecified amount to set up a state-owned, contractor-operated system — the government buying factories and outsourcing the manufacturing to private firms — along with money to back defense-related research and corporate restructuring.

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