Market Trends of Asia-Pacific Air Defense Systems Industry
Land Segment to Witness Highest Growth During the Forecast Period
The land segment currently leads the market and is projected to maintain its position throughout the forecast period. Rising defense expenditures in major countries, including China, India, Japan, and South Korea, drive the demand for this segment. For example, in 2023, defense spending from China, India, Japan, South Korea, and Australia constituted 88% of the region's total. These nations, alongside others in the region, are enhancing their defense capabilities in response to threats such as ballistic and cruise missiles, aircraft, UAVs, rockets, artillery, and mortars.
In a notable move, India announced in November 2023 its procurement of Igla-S hand-held anti-aircraft missiles from Russia, emphasizing its commitment to bolstering combat capabilities. The Igla, a man-portable air defense system (MANPADS), is adept at targeting enemy aircraft and helicopters.
Several countries in the region are developing advanced, indigenously made land-based air defense systems to address geopolitical threats from neighboring nations. Taiwan, for instance, declared in November 2023 that it had commenced mass production of its advanced TC-2 air defense system. This short-to-medium-range system is set to bolster Taiwan's defenses, with plans to integrate 246 Sky Sword II air defense missiles. Designed as a land-based countermeasure, the TC-2 aims to neutralize threats from China's aircraft, drones, and cruise missiles. Such regional investments underscore a commitment to border protection, fueling the market's growth during the forecast period.
China is Expected to Witness the Highest CAGR During the Forecast Period
China is poised to lead the growth of the regional air defense market during the forecast period. Geopolitical tensions and border disputes with neighboring countries drive China's military investments, particularly in advanced air defense systems.
As the top defense spender in the Asia-Pacific, China allocated USD 296 billion to military spending in 2023, marking a 6% increase from 2022. China's military spending aligns with the 14th Five-Year Plan (2021–2025), emphasizing the development of advanced weaponry, including high-energy laser systems designed to intercept aerial threats.
In August 2023, the National University of Defense Technology revealed its endeavor to create an indefinitely operable laser weapon. If realized, these high-powered lasers could revolutionize warfare, targeting drones, missiles, and small aircraft at near-light speeds and lower costs than traditional interceptor missiles. Furthermore, in November 2022, China South Industries Group Corporation (CSGC) and China North Industries Group Corporation unveiled the Type 625E AA Gun Missile Integrated Weapon System, a short-range air-defense system adept at detecting low-flying threats like drones. Such advancements are set to drive the market's growth.
