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Japan‘S wardrobe On Friday it approved a record defense budget plan of more than 9 trillion yen ($58 billion) for the coming year, aimed at bolstering its strike-back capability and coastal defense with cruise missiles and unmanned arsenals as tensions rise in the region.
The draft budget for fiscal year 2026, which begins in April, is 9.4% higher than 2025 and marks the fourth year of an ongoing five-year program to double Japan’s annual arms spending to 2% of gross domestic product.
This increase comes as Japan faces increased tensions ChinaJapanese Prime Minister Sanae Takaichi Had said in November that if China takes action against the self-governing island of Taiwan, then its country’s army may get involved. Beijing Says it should come under its rule.
Takachi’s government, under US pressure for a military increase, promised to achieve the 2% target by March, two years earlier than planned. Japan is also planning to revise its ongoing security and defense policy by December 2026 to further strengthen its military.
Missiles and drones will contribute to the defense of the south-western island
The new budget plan allocates more than 970 billion yen ($6.2 billion) to bolster Japan’s “standoff” missile capability. This includes the purchase of 177 billion yen ($1.13 billion) of domestically developed and advanced Type-12 surface-to-ship missiles with a range of approximately 1,000 kilometers (620 mi).
The first batch of Type-12 missiles will be deployed to Japan’s southwestern Kumamoto Prefecture in March, a year earlier than planned, as Japan ramps up its missile production in the region.
The current security strategy names China as the country’s biggest strategic challenge and calls for more aggressive roles for the Japan Self-Defense Force as part of its security alliance with the US.
In part because of Japan’s aging and declining population and its struggle with an understaffed military, the government believes unmanned weapons are necessary.
To protect the coasts, Japan will spend 100 billion yen ($640 million) to deploy “huge” 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 early deployment, Japan plans to initially rely primarily on imports from Türkiye or Israel.
Tension increased with China
The budget announcement comes as Japan’s dispute with China escalated following Takachi’s comments in November that the Japanese military could get involved if China took action against Taiwan, the self-ruled island that Beijing claims as its own.
Disagreements escalated this month when Chinese aircraft carrier exercises near southwestern Japan prompted Tokyo to protest when Chinese planes locked their radar on Japanese planes in what is considered possible preparation to fire missiles.
The Defense Ministry, already concerned about China’s rapid expansion into the Pacific, will open a new office dedicated to studying operations, equipment and other requirements for Japan to deal with China’s Pacific activity.
In June two Chinese aircraft carriers were spotted operating almost simultaneously for the first time near the southern Japanese island of Iwo Jima, raising Tokyo’s concerns about Beijing’s rapidly increasing military activity in areas beyond its borders and around the disputed East China Sea islands.
Japan plans joint development of frigates and jets
After drastically relaxing arms export restrictions in recent years, Japan is pushing to strengthen its largely domestic defense industry by participating in joint developments with friendly countries and boosting overseas sales.
For 2026, Japan plans to spend more than 160 billion yen ($1 billion) to jointly develop a next-generation fighter jet with Britain and Italy for deployment in 2035. There are also plans for research and development of AI-powered drones designed to fly alongside the jets.
In a massive boost to the country’s defense industry, Australia in August selected Mitsubishi Heavy Industries to upgrade the Mogami-class frigates to replace its fleet of 11 ANZAC-class ships.
Japan’s budget allocates about 10 billion yen ($64 million) to support the industry base and arms sales.
Target met but future funding 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 bring Japan’s annual spending to about 10 trillion yen ($64 billion), making it the world’s third-biggest spender after the US and China. The Finance Ministry said that Japan will meet the 2% target by March as promised.
Takachi’s government plans to finance its growing military spending by raising corporate and tobacco taxes and recently adopted a plan to increase income taxes starting in 2027. The prospects for future growth at a high percentage of GDP are unclear.