In today’s world, a nation’s strength is no longer solely defined by the size of its economy; it is equally shaped by the power of its military. Recent events, particularly the 2025 India-Pakistan standoff, have underscored the growing importance of defence capabilities. For Pakistan, balancing defence spending with economic growth has become a matter of national security and prosperity.
Following the 2025 conflict, Pakistan’s defence industry has experienced a significant growth. The country’s use of domestically built combat drones and the JF-17 Thunder fighter jet during the standoff highlighted its ability to compete globally. The JF-17, a multi-role fighter co-developed with China, has emerged as a key export product, offering countries a more affordable alternative to expensive fighters like the F-16 and Rafale. Priced between $30 million and $40 million, it’s an attractive option for air forces that need advanced radar, precision weapons, and reliable air policing platforms, yet are constrained by budget limitations.
Pakistan’s defence exports extend beyond just fighter jets. The country has diversified its offerings to include combat drones, training services, logistics, and advanced weaponry, all at a price point that appeals to nations in the Middle East and Africa. These regions are in high demand for affordable military equipment, and Pakistan is becoming a significant supplier. In fact, Pakistan has recently secured significant defence deals with countries like Libya and Sudan, providing everything from fighter jets to drones and air defense systems.
In these deals, Pakistan is not merely selling equipment but also using defence diplomacy to strengthen its global position. By offering not only hardware but also training, spare parts, and long-term support, Pakistan is deepening its strategic relationships with nations looking to modernize their military capabilities. A recent $4.6 billion arms deal with Libya and a $1.5 billion deal with Sudan highlight Pakistan’s growing role as a supplier of cost-effective and expendable drones and fighter jets.
While Pakistan’s increasing defence exports provide an economic boost, it still faces the challenge of balancing defence spending with economic growth. In 2024, the country’s defence budget was approximately $10.2 billion, which is 2.7% of its GDP. While this is a significant amount, it is modest compared to the defence budgets of global powers like the United States, which allocates $968 billion, China at $235 billion, and Russia at 8.1% of GDP. Despite these global comparisons, Pakistan ranks 29th in the world for defence spending, highlighting its relatively lower per-person expenditure. For context, India ranks 6th globally with a defence budget of USD 64 billion, and Israel ranks 11th with USD 34 billion allocated to defence.
Pakistan’s defence spending translates to just under $45 per person, while the US spends about $2,900 per person. Despite these financial constraints, Pakistan has focused on enhancing its defence capabilities through strategic investments in technology and efficient resource use. The development of domestically produced equipment like the JF-17 Thunder fighter jet has helped Pakistan maintain a strong defence posture while managing its budget. The increasing demand for the JF-17 abroad is expected to generate revenue through exports, which could offset some of the defense budget costs.
Pakistan’s growing defence exports are a vital part of its economic strategy. They help reduce the fiscal burden of defence spending, transforming it from a drain on national finances into a contributing economic sector. As defence production continues to grow, it complements other export-oriented industries like agriculture and manufacturing, further boosting the country’s economic resilience.
While these exports are helping strengthen Pakistan’s economy, the country still needs to prioritize domestic economic growth. A stronger economy would not only provide a foundation for military modernization but also reduce the relative burden of defense spending over time. By focusing on key sectors like technology, agriculture, and manufacturing, Pakistan can grow its GDP and create a more sustainable defense strategy. A stronger economy would enable the country to invest more in defense without dramatically increasing the proportion of GDP spent on it.
However, economic growth alone is not enough to guarantee security. The ongoing geopolitical instability, particularly tensions with India and Afghanistan, means that Pakistan must continue to invest in its defence capabilities. The 2025 India-Pakistan standoff made it clear that military strength is essential for protecting national sovereignty. Therefore, Pakistan must continue to balance its economic growth with strategic defence investments to ensure both national security and long-term prosperity.
