On August 29, Japan’s Defense Ministry requested 8.8 trillion yen ($60.1 billion) for fiscal year 2026, starting in April, its largest ever budget request. Tokyo is striving to strengthen its defense capabilities to cope with growing military threats from China, North Korea, and Russia.
The proposal, a 1.7 percent increase from the initial budget in the current fiscal year, marked the 14th consecutive year of rising fiscal requests from the ministry. The trend started when late Prime Minister Abe Shinzo, who adopted a tougher stance against North Korea and China, returned to power in December 2012. Current Prime Minister Ishiba Shigeru – who like Abe, belongs to the pro-U.S. Liberal Democratic Party (LDP) – has vowed to “fundamentally reinforce Japan’s defense capabilities.”
The budget request will be sent to the Finance Ministry to consider before a decision is made in late December. It is almost certain that next year’s budget will be the largest ever, which would mean the 12th consecutive year that Japan’s defense budget has set a new record.
Fiscal year 2026 marks the fourth year of the Defense Buildup Program, approved by the Japanese Cabinet in December 2022. Under this program, the government set to increase the total defense budget to about 43 trillion yen for the five years from fiscal 2023 to 2027.
As in the past three years, the budget plan lists seven key pillars of “necessary efforts to drastically strengthen Japan’s defense capabilities.”
Those are: (1) “stand-off defense capabilities,” such as mass production of longer-range missiles; (2) “comprehensive air and missile defense capabilities” to deal with various missiles; (3) “unmanned asset defense capabilities” such as the use of drones; (4) “cross-domain operational capabilities” in space, cyberspace, and electromagnetic domains; (5) “command and control and intelligence-related functions”; (6) “maneuvering and deployment capability” to send troops and supplies to the front line of a conflict; and (7) “sustainability and resiliency.”
Of these seven pillars, the defense budget request for next fiscal year places a strong emphasis on the third pillar: strengthening unmanned asset defense capabilities.
The Defense Ministry asked for 128.7 billion yen to establish an overall coastal defense system called “SHIELD” by fiscal year 2027, utilizing a massive fleet of unmanned vehicles in the air, sea, and underwater. The name stands for “Synchronized, Hybrid, Integrated and Enhanced Littoral Defense.”
The ministry said that it will acquire an unspecified number of surface ship-launched unmanned aerial vehicles (UAVs), small ship-based UAVs, small multirole unmanned surface vessels (USVs) and small multirole unmanned underwater vessels (UUVs) for the three branches of the Self-Defense Forces (SDF) – Ground (GSDF), Maritime (MSDF), and Air (ASDF) – to build SHIELD.
Defense officials said the plan would involve purchasing existing UAVs and USVs, primarily from foreign manufacturers. Most notably, the Defense Ministry requested 77 billion yen to acquire four more MQ-9B SkyGuardian UAVs, which have already been decided for deployment to the MSDF.
The ministry also plans to purchase the Turkish-made Bayraktar TB2 attack drone, which has been used in the war between Russia and Ukraine. The UAV is inexpensive, costing an estimated $5 million each.
In addition, the Defense Ministry requested 2.3 billion yen to conduct demonstration tests for simultaneous control of a large number of various unmanned assets.
As one of the major projects, the ministry also requested 104.8 billion yen to build one new multirole frigate, called the “New FFM” in Tokyo. The new ships are upgraded Mogami-class multirole frigates of the MSDF. It plans to construct a total of 12 New FFMs to be delivered by fiscal year 2032.
Requesting construction costs for just one New FFM in one year is very unusual because the ministry has so far earmarked the construction costs for two ships in the 2024 budget and three ships in the 2025 budget.
The move came as the Australian government selected the upgraded Mogami class as the Royal Australian Navy’s future fleet of general purpose frigates in early August.
It is widely believed that Tokyo has prioritized Canberra over its own MSDF in construction of the new upgraded Mogami class in order to win a lucrative Australian naval contract. The reduced acquisition pace of the New FFM for Japan may take into account the delivery deadline for Australia, which is urgently strengthening its naval power.
As part of its major naval modernization plan, Australia aims to acquire 11 new general purpose frigates to replace the aging Anzac-class frigates commissioned between 1996 and 2006.
The first three ships will be built in Japan, with the first to be delivered to the Royal Australian Navy in 2029 and enter service in 2030. The remaining eight will be built at Henderson shipyard in Western Australia.
On stand-off defense capabilities, the Defense Ministry requested 179.8 billion yen to acquire a new upgraded ground-based version of the Type 12 surface-to-ship missile (SSM) and its related ground equipment. The SSM is part of the country’s development of counterstrike capabilities.
The ministry announced it will start to deploy the new missile, which has an extended range of about 1,000 km, to the GSDF 5th Surface-to-Ship Missile Regiment at Camp Kengun in Kumamoto Prefecture on Kyushu Island during fiscal 2025 and 2026, and to the JGSDF Fuji Artillery School Unit at Camp Fuji in Shizuoka Prefecture during fiscal 2027.
The ministry also asked for 36.2 billion yen to acquire the long-range, ship-launched, improved version of the Type 12 SSM.
Japan began mass production of the improved Type 12 SSM in the current fiscal year. It said the MSDF will begin operating this new missile on the refurbished JS Teruzuki (DD-116) in fiscal 2027.
In addition, the Defense Ministry said the upgraded air-launched version of the Type 12 SSM is scheduled to enter service in fiscal 2027 at ASDF Hyakuri Air Base in Ibaraki Prefecture, where it will be operated by the upgraded F-2 fighter.
The Ministry of Defense will begin mass production of hypersonic guided missiles, which can fly at more than five times the speed of sound, from next fiscal year. For the first time, the ministry has requested a budget of 30.5 billion yen for the acquisition of these missiles and ground equipment.
As for the fourth pillar of enhancing “cross-domain operational capabilities,” the ministry requested about 176.8 billion yen to strengthen the security infrastructure for outer space. It plans to reorganize the Air Self-Defense Force to the Air and Space Self-Defense Force during the next fiscal year.
The Defense Ministry requested 206.6 billion yen to push ahead with its next-generation fighter program in partnership with the United Kingdom and Italy. It plans to continue developing a basic design for the future fighter’s fuselage and the detailed engineering of its engines. A Defense Ministry official said the first flight of the next-generation fighter jet is scheduled for around 2030.
In addition, it requested 4.9 billion yen for research and development of unmanned aircraft to be used in conjunction with this next-generation fighter jet. Specifically, it will carry out conceptual design of a collaborative unmanned aircraft that utilizes artificial intelligence to enable autonomous situational and flight decisions and other behavioral decisions.