The Global Arms Trade

Who sells and buys weapons around the world, why the trade is dominated by a few countries, and the economic and ethical debates it raises.

Weapons are bought and sold across borders in a market worth tens of billions of dollars a year. The arms trade is shaped by economics, politics and security all at once.

Who sells

A small number of countries dominate arms exports. According to SIPRI, the United States is by far the largest exporter, accounting for over 40 percent of global arms exports in the period 2020 to 2024. France has become the second-largest exporter, with Russia’s exports having fallen sharply. China, Germany, Italy and the United Kingdom are also major sellers.

Who buys

Buyers include countries facing security threats or modernising their militaries. India has been one of the world’s largest arms importers for many years, historically buying heavily from Russia but increasingly from France, the United States and Israel. Ukraine became one of the largest importers after 2022, largely through military aid. Countries in the Middle East, such as Saudi Arabia and Qatar, are also major buyers.

The economics of the defence industry

Making advanced weapons involves very high research and development costs and relatively small production runs. Exports help spread these fixed costs over more units, lowering the price for the producing country’s own military. This is one reason governments actively support arms exports.

The industry is concentrated in a few large companies, and governments are often the only customers, creating an unusual market with few buyers and few sellers.

Make in India for defence

India has sought to reduce its dependence on imports by building a domestic defence industry. Policies have included lists of equipment that must be bought from Indian producers and support for private and state-owned manufacturers. India's defence exports have grown quickly from a small base in recent years, though the country remains a large importer.

Debates

The arms trade raises hard questions. Exports support jobs and alliances, but weapons can fuel conflicts, human rights abuses and regional arms races. Many countries use export controls to restrict sales to certain countries, and the Arms Trade Treaty, which entered into force in 2014, sets international standards for regulating the trade.

Thinking arms exports are just ordinary trade

Arms sales are rarely purely commercial. Governments approve and often negotiate them as part of foreign policy, and they carry consequences for security and human rights that ordinary goods do not.

Key takeaways

The United States is the largest arms exporter, followed by France.
India has long been among the largest arms importers and is building a domestic industry.
Exports help spread the high fixed costs of developing weapons.
Export controls and the Arms Trade Treaty try to limit harmful sales.