TAIPEI (Taiwan News) — An Australian defense expert on Wednesday said Taiwan’s sharp cuts to its domestic drone budget could weaken its coastal defense capabilities and increase reliance on US arms sales that could be vulnerable to pressure from Beijing.

Retired Royal Australian Air Force Group Captain Peter Layton, a visiting fellow at the Griffith Asia Institute, told CNA that last week’s “Balikatan” joint US-Philippine military exercises demonstrated how Indo-Pacific partners are increasingly emphasizing drones in combined joint and multinational operations. He said the drills showed how Indo-Pacific partners are increasingly integrating drones into littoral warfare strategies.

Layton noted that this year’s Balikatan exercises, held across the Philippine archipelago, included the US, the Philippines, Australia, Canada, France, Japan, and New Zealand. He said one of the key highlights was the use of drones to support littoral warfare operations.

Japan deployed Type 88 surface-to-ship missiles during the exercises, while the US launched Tomahawk cruise missiles from the Typhon system and used HIMARS multiple launch rocket systems against maritime targets, Layton said. He added that drones, including the US-operated Predator and Japan’s smaller ScanEagle systems, provided targeting intelligence for the missile strikes.

Layton said the drills marked the first time Japan had launched missiles during exercises in the Philippines and the first deployment of US Tomahawk missiles from the Typhon system on Philippine territory, CNA reported. He said the exercises reflected a united determination among Indo-Pacific partners to deter Chinese expansion.

The expert said drones have become increasingly important in countering China’s military ambitions. He noted that Australia announced in April plans to invest AU$1.2 billion to AU$1.5 billion (NT$27.4 billion to NT$34.2 billion) over the next decade in the Ghost Bat drone, Ghost Shark autonomous submarine, and counter-drone technologies, though he said the funding remained insufficient.

China is likely to welcome both Australia’s underinvestment and Taiwan’s cuts to its domestic drone budget, Layton said. He warned that reducing drone funding effectively weakens Taiwan’s littoral warfare capabilities.

Layton said China understands the effectiveness of drone-supported littoral warfare systems and sees them as difficult defenses to overcome, according to CNA. He added that reducing Taiwan’s domestic drone capabilities removes a major obstacle to weakening Taiwan’s military defenses.

Taiwan would become increasingly dependent on US weapons purchases, while Beijing’s focus would shift toward securing a political deal favorable to China with US President Donald Trump, Layton said. He also warned that China continues to threaten Taiwan’s security and broader Indo-Pacific stability through gray-zone tactics.

Layton cited remarks made May 9 by Chinese Defense Ministry spokesperson Jiang Bin denying the existence of the Taiwan Strait median line. He said the timing of the comments, shortly before a Trump-Xi meeting, suggested Beijing was seeking greater leverage in negotiations with Washington.