Global Arms Sales Rise Worldwide; Indian Companies Show Decline

India is the only emerging producer of arms that has seen a decline in its sales in 2016, according to the ranking of arms and military services companies released by Stockholm International Peace Research Institute (SIPRI) on Dec. 11.

Among the emerging producers, seven South Korean companies were ranked among top 100 producers of arms. The country holds a 2.2 per cent share of the total top 100 sales in 2016, putting it alongside other established producers such as Israel and Japan. South Korea’s arm production is seen as a response to perceived threat by its neighbor, North Korea.

India is the only emerging producer showing a decline (–1.2 per cent) in arms sales in 2016.

As per the report released by SIPRI, companies based in the United States and West Europe dominate the top 100 in 2016, totaling to 63. They make for 82.4 per cent of total arms sales for 2016 — the same as 2015. The top 10 are companies based there are led by U.S.-based Lockheed Martin.

The United States, with 38 companies ranked in the list for 2016, accounted for 57.9 per cent of the total top 100 arms sales. The United Kingdom followed with 9.6 per cent while the corresponding figure for India was 1.6 per cent.

Arms sales of the world’s 100 largest arms-producing and military services companies totaled $374.8 billion in 2016 — a 1.9 per cent increase as compared with 2015. As per the report, this is the first year of growth in top 100 arms sales after five consecutive years of decline.

According to SIPRI report released earlier this year, India, Saudi Arabia, UAE, China and Algeria were the top importers of arms during the period of 2012-2016. These five countries make for 34 per cent of all global imports, and India leads the group by accounting for 13 per cent. India was leading during the period 2007-11 as well with 9 per cent of global imports being received by the country.

India’s imports increased by 43 per cent during 2012-2016 as compared to 2007-2011. The report attributes the failure of India’s arms industry to manufacture competitive indigenously designed weapons as a reason for the country’s high level of imports. Russia supplied 68 per cent of India’s arm imports, while the United States and Israel contributed 14 per cent and 7.2 per cent, respectively, in the 2012-16 period. Russia is expected to remain the major supplier of arms in the near future as well.

China dropped to the fourth place in this period from being one of the largest importers in the early 2000s. According to the report, this is because China has become increasingly proficient in producing its own weapons during this period, resulting in a drop of arms import by 11 per cent. Beijing remains dependent on imports such as large transport aircraft and helicopters, and engines for aircraft, vehicles and ships. Russia is China’s largest supplier as well, accounting for 57 per cent of its import, followed by Ukraine (16 per cent) and France (15 per cent).

Tensions in the South China Sea, West Asia, and the Indian subcontinent are the main reasons for a rise in arms imports in West Asia and Asia-Oceania, so much so that Vietnam, which was 29th largest importer during 2007-11 jumped to being the 10th largest in 2012-16. With 202 per cent jump in arms import, the country showed the highest growth rate among the top 10 importers. The regions of West-Asia and Asia-Oceania contributed to 72 percent of all arms imports during 2012-2016 as compared to 2007-2011.

The five biggest exporters in 2012-16 were the United States, Russia, China, France and Germany, accounting for 74 per cent of the total volume of arms exports. The United States and Russia supplied 56 per cent of all exports, while Germany and France saw a drop in arms sales. The volume of transfer of major weapons in 2012-16 was 8.4 percent higher than that in 2007-11 as per SIPRI’s military expenditure database.