Nationalist Party lawmakers are pushing for increased defense spending to counter Beijing's military expansion, sparking internal divisions ahead of critical legislative votes.

This debate comes as China's military modernization accelerates, with Taiwan allocating US$17.4 billion for new hardware and personnel in 2026. The opposition party's push contrasts with the ruling Democratic Progressive Party's more cautious approach, reflecting deeper political rifts over Taiwan's security strategy.

Investors are watching closely, as defense spending could impact Taiwan's economy and its relationship with the U.S., which has pledged support but avoids formal alliances. The outcome may signal Taiwan's strategic priorities in navigating China's pressure.