TAIPEI (Taiwan News) — The proposed NT$1.25 trillion (US$40 billion) special defense budget will help boost Taiwan’s domestic defense industry, Deputy Defense Minister Hsu Szu-chien (徐斯儉) said Thursday.

Hsu said the budget would help domestic manufacturers invest in research, development, and capacity building, according to the Military News Agency. This, in turn, would strengthen defense autonomy and supply chain resilience, he said.

The budget would also support long-term procurement of unmanned systems and related equipment, rapidly upgrading Taiwan’s combat power, Hsu added.

The special budget is a one-time, large-scale investment, the deputy defense minister said. It will accelerate the development of combat capabilities and provide long-term, stable demand for domestic industries, he said.

Hsu warned that handling the budget through annual allocations would negatively affect the military’s timeline and integration efficiency.

He reiterated that preliminary coordination for arms procurement cases has been completed with US counterparts, and formal Letters of Offer and Acceptance have been received. The defense ministry will maintain close contact with the US to ensure the smooth progression of all procurement cases.