The global military expenditure is estimated to be USD 2,012.1 billion in 2023 and is expected to reach USD 2,132.0 billion in 2024, growing at an annual rate of 2.74% from 2023 to 2024.

Various regions around the world confront distinctive security challenges, including but not limited to territorial disputes, regional rivalries, and cross-border conflicts. In response to these concerns and to maintain regional stability, countries commit substantial portions of their financial resources to defense. For instance, in the Asia-Pacific region, the escalating military capabilities of China have compelled neighboring nations to fortify their defense capabilities. Similarly, the Middle East contends with security threats emanating from terrorism, internal conflicts, and external aggression, prompting regional nations to allocate significant financial resources to safeguard their interests. The strategic allocation of defense budgets is also influenced by regional defense cooperation and alliances, as nations strive to bolster collective security and deter potential aggressors. These factors are anticipated to exert a considerable impact on global defense budgeting in the forecast period.

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Key players in the study include Northrop Grumman Corporation (US), BAE Systems (UK), Lockheed Martin Corporation (US), Rheinmetall AG (Germany), Oshkosh Corporation (US), Hanwha Defense (South Korea), among others.

The Airborne platform segment is expected to lead the budget allocation in 2024 and beyond.

Globally, the Airborne platform is seeing new investments along with new programs and developments. This is due to an increased focus on precision engagement, rapid global mobility, agile combat support, electronic warfare, strategic mobility, and global reach. Due to these investments and factors, the Airborne platform is projected to grow from USD 72 billion in 2023 to USD 75 billion by 2024 at an annual rate of 2.1%. The Army, across the globe, has seen multiple modernization initiatives with upgrading future soldier systems, developing new armored vehicles, accuracy and range improvements in artillery and missile systems, counterinsurgency operations, urban warfare, and logistics post the Russia-Ukraine war. For instance, the Indian Army has ongoing modernization programs with 93 projects worth USD 18.4 billion. The Naval platform has witnessed an increased focus on the acquisition of new naval vessels, the development of aircraft carriers, nuclear-powered submarines, unmanned submersibles, and surface vessels, and the improvement of Anti-Access/Area Denial (A2/AD) owing to rising territorial disputes and maritime security.

The army domain is expected to dominate the budget analysis in 2024.

In the domain allocation segment of the defense budget, the army subsegment is expected to dominate the defense budget analysis and is projected to grow from USD 621.3 billion in 2023 to USD 655.1 billion by 2024 at an annual rate of 2.7%. This is due to the primary focus on maintaining a capable and well-equipped military force to ensure national security and defense preparedness. The army segment includes personnel, training, operations, equipment procurement, research and development, and maintenance expenditures. The increasing global security threats, geopolitical tensions, and the need to adapt to evolving defense landscapes further drive allocating a significant portion of the defense budget toward military forces. As a result, the army domain is anticipated to hold a significant market share in the defense budget allocation, reflecting the importance of maintaining a robust and modern military capability.

North America region is estimated to account for the largest share in 2024 while the Asia Pacific region is expected to witness substantial investments in defense industry across countries.

The world military expenditure analysis has been studied in North America, Europe, Asia Pacific, and the Rest of the World. North America is projected to have the largest share in the world defense budget allocation market. This dominance is driven by the substantial defense budget of the United States, the presence of advanced defense industries, and the region’s active military engagement and global security responsibilities. The upswing in expenditures on modernization initiatives in the Asia Pacific region is driven by several factors, including the growing sophistication of weapon systems, the necessity to replace aging equipment, and the aspiration to maintain a technological edge. Countries like India, Japan, South Korea, and Australia are channeling substantial investments into novel weapons systems such as fifth-generation fighters, stealth bombers, and missile systems.