The comprehensive report highlights that the top five military spenders — the United States, China, Russia, Germany, and India — collectively account for 58% of the world’s total defence expenditure.
The significant hike in India’s budget was primarily fuelled by the May 2025 military escalations with Pakistan, which witnessed the active deployment of fighter jets, drones, and missiles. Consequently, Pakistan also bolstered its military budget by 11% to $11.9 billion, heavily investing in new weaponry from China and settling prior defence deals.
Globally, military spending rose by nearly 3% in 2025, absorbing 2.5% of the world’s GDP — the highest allocation recorded since 2009. The ongoing conflict in Ukraine and NATO’s heightened military preparedness spurred a 14% increase in Europe’s defence spending. Meanwhile, the Asia and Oceania regions recorded an 8.1% surge.
Interestingly, while China escalated its defence budget by 7.4% to $336 billion — marking its 31st consecutive annual increase — the United States saw a 7.5% drop to $954 billion, largely due to unapproved military aid packages for Ukraine.