Taiwan is moving to modernize its armed forces, including the development of domestically produced submarines, in response to heightened pressure from China which claims Taiwan as part of its territory.

The push to strengthen defense comes as the United States urges greater regional security resilience amid China’s rapid military modernization.

The defense budget for 2027 is projected to surpass NT$1 trillion, representing a 16% increase, with a steady expansion in military readiness.

Treasury figures also indicate the defense portion would exceed 3% of gross domestic product, underscoring a substantial fiscal push for security.

The plan echoes U.S. calls for Taiwan to boost defense spending, a position publicly backed by President Lai Ching-te.

China continues daily military activity around Taiwan, conducts periodic war games, and refuses to engage with Lai Ching-te, labeling him a separatist.

Taiwan conducted a nuclear, biological, and chemical decontamination drill on its east coast to test rapid response and return-to-front-line capability in case of chemical attack.

The broader context shows China treating Taiwan as part of its territory and engaging in frequent war games, while Taipei upholds democratic self-rule and rejects Beijing’s claims.

Taiwan’s cabinet plans a 16% year-on-year rise in defense spending for 2027, exceeding NT$1 trillion for the first time, with the total budget projected just above that threshold.

Taiwan will unveil a proposed budget of just over NT$1.1 trillion on August 20, with projections that the share of GDP devoted to defense will surpass 3% and funds will support the coast guard, veterans, and special projects.

According to the Central News Agency, the forthcoming budget includes allocations for the coast guard, veterans affairs, and special projects, and is expected to exceed 3% of Taiwan’s GDP.

The budget release remains scheduled for August 20, and analysts anticipate it will top NT$1.1 trillion in total spending.