Market Trends of Asia-Pacific Ammunition Industry
This section covers the major market trends shaping the APAC Ammunition Market according to our research experts:
Military Segment is Expected to Dominate the Market During the Forecast Period
The military segment is anticipated to dominate the market during the forecast period due to the increase in procurement of ammunition by the armed forces to subdue the threats arising due to terrorism, territorial conflicts, and geopolitical tensions. The countries are procuring artillery and mortar systems to safeguard their borders against illegal trespassing and several forms of trafficking, generating demand for ammunition. Increasing defense expenditure and expansion of military forces from countries such as China and India boost the growth of the market. China and India are the world's second and third largest defense spenders, with a defense budget of USD 291 billion and USD 76.6 billion, respectively.
For instance, in October 2022, Nammo AS, a Norway-based ammunition manufacturer, entered into an agreement with South Korea's Hyundai Rotem to develop new 120 mm ammunition for the K2 Black Panther main battle tank (MBT). Furthermore, the Indian Ministry of Defence (MoD) is planning to procure air-defense (AD) guns for the Indian Army. The Indian MoD issued a request for proposal (RFP) that includes the acquisition of 220 towed AD guns and nearly 142,000 rounds of ammunition. Thus, growing expenditure on the strengthening of military forces and procurement of advanced weapons drive market growth across the region.
India is expected to Witness the Highest Growth during the Forecast Period
India is estimated to show significant growth in the market during the forecast period. The growth is attributed to the rising defense expenditure, growing terrorism, and cross-border conflicts among neighboring countries, such as China and Pakistan. The country is focusing on the procurement of new advanced weapons with enhanced lethality, driving the demand for ammunition in India. Growing terrorist activities and increased tensions between India and China along the Line of Control (LOC) are leading to growing expenditure on the defense sector and strengthening defense capabilities.
For instance, in June 2022, the Defence Procurement Board (DPB) of India issued a Request for Information (RFI) for the procurement of 4,800 new sniper rifles with telescopic sight and 78 lakh rounds of ammunition to provide a massive boost to the Indian Army's firepower capabilities. The new .338 caliber rifles should have an effective range of not less than 1,200 meters, and it has a service life of a minimum of 10 years or 5,000 rounds. The total cost of the procurement is more than Rs 450 crore. In addition to that, India and Japan have been investing significantly in modernizing its armory to counter the growing influence of China over the South China Sea. Thus, rising investment in the procurement of next-generation rifles and ammunition drives the growth of the market across the region.
