NATO Pledges 5% GDP Defence Spending By 2035 Amid Rising Global Conflicts And Tensions

At its June summit, NATO pledged to raise defence spending to 5% of member nations’ GDP by 2035, up from the earlier 2% target.

NATO’s new pledge to raise defence spending is driven by ongoing conflicts (Russia-Ukraine, Israel-Gaza, Israel-Iran, India-Pakistan) and geopolitical tensions.

Historical Trajectory of Military Spending

Global military spending reached $2718 billion in 2024, marking the steepest rise ( a 9.4% increase) since the end of the Cold War.

Top five spenders: United States ($997B), China ($314B), Russia ($149B), Germany ($88.5B), India ($86.1B). (60% of total).
The top 15 spenders account for nearly 80% of global defence budgets.
All 32 NATO members combined spent $1.506 trillion—about 55% of the global total.

2024 was the 10th consecutive year of increase in worldwide military expenditure.
Over 100 countries increased their military expenditure in 2024.
As a share of global GDP:
- Peaked at 6.1% in 1960 (Cold War era)
- Fell to 2.1% by 1998
- Rose to 2.5% in 2024

Crowding-out effect: Studies show higher military budgets reduce health and welfare spending, especially in low- and middle-income countries.
In 2023, militarisation increased in 108 countries, the highest number since World War II.
Spain, spending just 1.24% of its GDP on defence, rejected NATO’s new target as “unreasonable,” warning the €300 billion cost would slash welfare spending.

The UN budget is just $44 billion (half of which remains unfunded) is a fraction of global military spending.
In the 12-day Israel–Iran clash, the U.S. alone reportedly spent almost $1 billion on missile defence.
Programs that address healthcare, nutrition, poverty, and climate action are suffering from chronic underfunding.
Policy shifts—including cuts to USAID and foreign aid—have strained UN capabilities; a Lancet study estimates that USAID health programs may have prevented 91 million deaths, and cuts could result in 14 million additional deaths by 2030, mostly children.

Ending extreme poverty and absolute poverty by 2030 requires annual expenditures of $70 billion and $325 billion, respectively—small compared to defence outlays.
Militaries are large carbon emitters. A 3.5% GDP defence spending target for NATO could raise CO₂ emissions by 200 million tonnes annually.

India’s defence spending is 2.3% of GDP, while public health is 1.84%, below the National Health Policy target of 2.5%, and far below developed-country benchmarks (~10%).
Following Operation Sindoor, India allocated an extra ₹50,000 crore for emergency military purchases—on top of a ₹6.81 lakh crore defence budget. In contrast, Ayushman Bharat covering 58 crore people gets only ₹7,200 crore.

NATO was established in 1949 with the signing of the North Atlantic Treaty, also known as the Washington Treaty. It was created primarily to deter Soviet expansion in Europe following World War II.
It is built on the principle of collective defence (outlined in Article 5 of the Treaty), which states that an attack on one member is considered an attack on all.
Founding Members (12): Belgium, Canada, Denmark, France, Iceland, Italy, Luxembourg, the Netherlands, Norway, Portugal, the United Kingdom, and the United States.
- Finland joined the alliance in 2023.
Funding: All member countries contribute to NATO’s operational costs based on a cost-sharing formula tied to each country’s Gross National Income.

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