Japan’s cabinet has approved a record defense budget aimed at deterring China

TOKYO (AP) — Japan’s cabinet on Friday approved a record defense budget plan of more than 9 trillion yen ($58 billion) for next year, aimed at strengthening its strike-back capability and coastal defenses with cruise missiles and unmanned aerial vehicles, amid rising tensions in the region.

The draft budget for fiscal year 2026, which begins in April, is a 9.4% increase over 2025 and is the fourth year of Japan’s ongoing five-year program to double annual arms spending to 2% of gross domestic product.

The increase comes as Japan faces heightened tensions from China. Japanese Prime Minister Sane Takaichi said in November that his country’s military might be involved if China took action against Taiwan.

Under US pressure for a military increase, Takaichi’s government pledged to achieve the 2% target by March, two years ahead of schedule. Japan also plans to revise its ongoing security and defense policy by December 2026 to further strengthen its military.

Missiles and drones will add to the defense of the southwestern island

Japan has been strengthening its offensive capabilities to attack enemy targets from afar with long-range missiles, a major break from its post-World War II doctrine of limiting the use of force in self-defense.

The current security strategy, adopted in 2022, names China as the country’s biggest strategic challenge and calls for a more aggressive role for Japan’s Self-Defense Forces under the security alliance with the US.

The new budget plan allocates more than 970 billion yen ($6.2 billion) to bolster Japan’s “standoff” missile capabilities. This includes the 177 billion-yen ($1.13 billion) purchase of a domestically developed and upgraded Type-12 surface-to-ship missile with a range of about 1,000 kilometers (620 miles).

The first batch of Type-12 missiles will be deployed in Japan’s southwestern Kumamoto province in March, a year ahead of schedule, as Japan accelerates its missile production in the region.

Due to Japan’s aging and shrinking population and struggles with an understaffed military, the government believes unmanned weapons are necessary.

To protect the coast, Japan will spend 100 billion yen ($640 million) to deploy “large” unmanned air, sea surface and underwater drones for surveillance and defense under a system called “SHIELD” planned for March 2028, defense ministry officials said.

For rapid deployment, Japan initially plans to rely mainly on imports from Turkey or Israel.

Tensions with China are increasing

The budget announcement comes as Japan’s dispute with China escalated after Takaichi’s comments in November suggested that the Japanese military might be involved if China took action against Taiwan, the self-governing island that Beijing claims.

Disagreements escalated this month when Chinese aircraft carrier exercises near southwestern Japan prompted protests from Tokyo after Chinese planes locked their radar on Japanese planes, which were believed to be preparing to fire missiles.

Already concerned about China’s rapid expansion in the Pacific, the Defense Ministry will open a new office dedicated to studying operations, equipment and other requirements for Japan to counter China’s Pacific activities.

Two Chinese aircraft carriers were first seen in June operating almost simultaneously near the southern Japanese island of Iwo Jima, raising Tokyo’s concerns about Beijing’s rapidly expanding military activities and territories around the disputed East China Sea islands.

Japan plans to jointly develop frigates and jets

Japan has been pushing to bolster its largely domestic defense industry by participating in joint development with allies and boosting foreign sales after sharply easing arms export restrictions in recent years.

For 2026, Japan plans to spend more than 160 billion yen ($1 billion) to jointly develop next-generation fighter jets with Britain and Italy for deployment in 2035. Jet also plans to research and develop AI-powered drones designed to fly.

In a major boost to the country’s defense industry, Australia selected Mitsubishi Heavy Industries in August to upgrade the Mogami-class frigate to replace its fleet of 11 ANZAC-class ships.

Japan’s budget has allocated about 10 billion yen ($64 million) to support the industrial base and arms sales.

To meet the goals but future funding is uncertain

The budget plan needs parliamentary approval by March to be implemented as part of a 122.3 trillion yen ($784 billion) national budget bill.

The five-year defense construction program will raise Japan’s annual spending to about 10 trillion yen ($64 billion), making it the world’s third-biggest spender behind the US and China. According to the Ministry of Finance, Japan will meet the 2 percent target by March as promised.

Takaichi’s government plans to fund its rising military spending by raising corporate and tobacco taxes, and recently adopted a plan to increase income taxes in 2027. Future growth prospects at higher percentages of GDP are unclear.