Market Trends of APAC Defense Industry
Air Force Segment is Anticipated to Register the Highest Market Share During the Forecast Period
- The air force segment currently has the highest market share in the Asia-Pacific defense market. The countries such as China and India are heavily investing in the procurement of new aircraft, unmanned aerial vehicles (UAVs), and the required training and simulation, missiles, and ammunition. This rapid procurement strengthens air superiority and modernizes the region's military equipment. With territorial issues and political issues acting as major drivers in the market, the demand for UAVs and patrol aircraft is increasing for intelligence, surveillance, and reconnaissance missions.
- Countries such as New Zealand, the Philippines, South Korea, Thailand, and India, have placed orders for new maritime patrol aircraft during the past few years. According to an Asian military review, in terms of operational fleet, the region has the largest fleet of aircraft and rotorcraft, with 14,529 aircraft. Out of these, combat aircraft constitute about 4,998, along with 520 special purpose aircraft, 46 tankers, 1,008 transport, and 3,079 training and helicopters.
- The demand for the air force in the region is also being fueled by the military modernization program of most Asian nations to replace their outdated fighter aircraft with newer generation aircraft to enhance their aerial combat capabilities.
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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 procuring 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 a minimum service life of 10 years or 5,000 rounds. The total cost of the procurement is more than USD 54.82 million.
- In addition, India and Japan have been investing significantly in modernizing their armory to counter China's growing influence over the South China Sea. Thus, rising investment in procuring next-generation rifles and ammunition drives the market's growth across the region.
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