China raised military spending to meet inflation, and training and equipment needs. Premier Wen Jiabao said in his national report that focusing on fighting the battle against inflation is very significant. From Reuters via Financial Times :
Chinese Premier Wen Jiabao warned on Wednesday that overheating remains his nation’s top economic foe even as global growth softens, vowing a tough fight against price rises and feverish investment.
In his annual ”state of the nation” report to parliament, Wen targeted pollution, misgovernment and the gulf between the urban rich and farming poor as China prepares to go on show at the Olympic Games.
But he mostly dwelt on the risks that heady inflation poses to China’s social fabric and double-digit growth, which has transformed the country into the world’s fourth-biggest economy.
See also Beijing raises funds for military by 17.6% from Financial Times.