China accounted for a third of Asia's military spending in 2016 and was looking to sell more arms abroad, the International Institute for Strategic Studies (IISS) said in a report on Tuesday.
China's overall defense budget last year was $145 billion (137 billion euros), 1.8 times higher than South Korea and Japan combined. China's spending was topped only by the United States which spent $604.5 billion (572 billion euros) on defense in 2016.
On air power, China "appears to be reaching near-parity with the West," IISS said, adding that Chinese-made drones had been seen in Nigeria and Saudi Arabia.
Its sales in Africa had moved beyond Soviet-era designs to exports of systems designed in China itself, the think tank's report found.
China's air force had introduced a "highly capable" short-range missile in a class only a handful of leading aerospace nations had been able to develop, it added.
Additionally, China's long range air-to-air missile seen on exercise last year posed a risk for aircraft tankers and AWACS surveillance aircraft that previously loitered safe out of range.
Given China's advances Western dominance "can no longer be taken for granted," said IISS director John Chipman.
NATO members falling short
Across all nations, there was a "growing proliferation of lethality," the IISS concluded, warning the West that increasing sophistication was "complicating" its military options.
Only two European NATO nations - Greece and Estonia - met the aim of spending 2 percent of their gross domestic product (GDP) on defense in 2016, concluded the IISS.
The report also noted that Britain spent 1.98 percent of its GDP on defense, falling short of the 2 percent NATO target. A spokesman with the British Ministry of Defense denied the shortfall, saying that "NATO's own figures clearly show the UK spends over 2 percent of its GDP on defense."
Both British officials and the IISS emphasized that the UK's defense budget is still the largest in Europe.
With $60 billion in spending, Russia remained the "principle security concern," said the think tank. It stressed that Russian equipment outranged the missile and rocket artillery systems of NATO's most capable power, the USA.
"The Kalibr cruise missile, for instance, is being fitted to an array of Russian naval vessels - including an arctic patrol vessel," it said.
NATO would need to "refocus" on spending targets that lead to real capability improvements among systems that were increasingly complex, the IISS recommended.
Ahead of NATO talks in Brussels on Wednesday and the Munich Security Conference next weekend, NATO head Jens Stoltenberg admitted that the "picture is still mixed" with some allies "really struggling."
He was responding to a question about budget constraints in Italy, which is trying to reduce its budget deficit following the euro zone crisis.
ipj/rs (Reuters, AFP, dpa, AP)