Frost & Sullivan: APAC Land Defense Systems Market driven by the need for Upgrades and ReplacementsThe need to implement modern technologies to replace ageing equipment has boosted the prospects of the APAC land defense systems market with threats in the form of illegal trafficking, piracy, and terrorism running rampant across the region.
By: Frost & Sullivan Ageing defense systems have increased the importance of military upgrades and replacements in this region, as modern land defense technology will drive the market for highly capable, reliable, and cost-efficient systems to protect against foreign and domestic threats. According to Frost & Sullivan’s Asia Pacific Consultant of Aerospace & Defense Practice Kunal Sinha, the Asia Pacific Land Defense Systems market earned revenues of over USD5.4 billion in 2009, and estimates this to reach USD9.4 billion in 2016 growing at a CAGR of 9.7% from 2009-2016. “The land defense systems market in Asia Pacific is a growing market. With the need for modern advancements in defense technology, both local and foreign defense contractors having opportunities to showcase modern land defense systems to better equip countries in Asia Pacific and augment defense mechanisms,” He continues, “Network-centric warfare (NCW) is one of the factors triggering military modernization and a more network-oriented military defense structure. With the world shifting toward NCW, priorities are placed in information superiority over enemy forces, providing an advantage early in battle.” Interoperability between different land defense systems will also offer Asia Pacific countries the advantage of situational awareness and ramp up defense capabilities. Although market prospects look upbeat, high procurement costs are deterring smaller nations from upgrading their land defense systems. Next-generation land defense systems easily cost up to millions and thus, are very expensive for developing countries, which are yet to make their procurement decisions. “These systems are increasing in cost as the research and development costs involved are exorbitant. With developed countries looking to produce their own capabilities in this segment, the funding for technological improvements will continue to rise, increasing the price and costs for end users,” states Sinha. Thus, the continued investment from local and foreign players to develop the research and development capabilities of nations in Asia Pacific is imperative. This reduces the costs and provides better reliability and market penetration initiatives. “With local capabilities, the competitive cost structures are also improved, creating a better market for local players to showcase their armaments that is on par with foreign contractors. Strategic alliances with the local business partners also ensure better chances of market penetration. This would create better chances of local presence in this region, and also ensure better system interoperability,” He elaborates, “Maintaining good political relationships with the governing entities would also open opportunities for contractors to market their products, and ensure that the end users are getting the best products and services. This helps in understanding the customer needs, customer requirements, and creating awareness regarding better and upcoming technologies, and their advantages.” “Going forward, communication systems, radars, and intelligence, surveillance, and reconnaissance (ISR) systems will see growth in the land defense systems market together with other market segments such as armored vehicles, missiles, artillery, and fire arms,” says Kunal. He concludes, “Information superiority, situational awareness and network centric systems are the key factors in modern defense tactics which also determine the direction of future military land defense systems upgrade and procurement programs.” About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from 40 offices on six continents. To join our Growth Partnership, please visit http://www.frost.com. Media Contact: Donna Jeremiah Corporate Communications – Southeast Asia P: +603 6204 5832 F: +603 6201 7402 E: djeremiah@frost.com Carrie Low Corporate Communications – Southeast Asia P: +603 6204 5910 F: +603 6201 7402 E: carrie.low@frost.com http://www.frost.com # # # Frost & Sullivan, the Growth Partnership Company, partners with clients to accelerate their growth. The company's research and consulting services empower clients to generate, evaluate, and implement effective growth strategies. End
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