Omani and UK Challenger 2 MBTs during Exercise Saif Sareea3 in 2018. Credit: UK MoD/Crown copyright

A projected rise in defence budgets in the Sultanate of Oman, strategically located on the southeastern coast of the Arabian Peninsula, is being driven by spending in the land domain, in part through a doubling of expenditure on its main battle tank (MBT) and infantry fighting vehicle (IFV) fleets.

Newly released figures from GlobalData’s Oman Defense Market report indicates that spending on MBTs would rise from $38m (OR14.4m) in 2024 to $85m by 2034, a significant decade-long increase. Over a shorter time period, between 2024-2029 Oman’s spending on IFV would increase from $4.5m currently to $9.6m by 2029.

Oman acquired 38 Challenger 2 MBTs from Alvis Vickers, now BAE Systems Land Systems, between 1996-2001, along with four Challenger recovery vehicles in 1996. The country also operates an unknown number of M60A1 and M60A3 MBTs, obtained from the US in the 1980s and 1990s respectively.

Oman’s PARS III IFVs have been provided by FNSS, and are among the newest platforms in the Sultanate’s military. Credit: FNSS

It is likely that the increase in spending in the MBT segment will be driven by maintenance and upgrade costs as the Sultanate looks to keep its ageing platforms operational. Oman’s Challenger 2 MBTs were ‘desertised’ in order to improve their operational capabilities in hot, dry, and sandy conditions, with one armoured brigade operating the type.

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The only other operator of the Challenger 2 – the UK – is upgrading 148 of its 227-strong fleet to the Challenger 3 variant, incorporating an active protection system, a new turret, and Rheinmetall’s 155mm L55A1 smoothbore gun.

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Oman operates 27 PARS III 6×6 and 145 PARS III 8×8 wheeled IFVs provided by FNSS in the mid-to-late-2010s, and as such are among the Sultanate’s newest land platforms. It also operates a small number (approximately six) of VBC-90 scout vehicles obtained in the 1980s, according to GlobalData intelligence.

Charting Oman’s defence spending increase

Oman looks to be emerging from a multi-year period of defence spending decline, which between 2020-2024 registered a negative compound annual growth rate (CAGR) of 2.9%, primarily due to lower oil prices and the impact of the Covid-19 pandemic.

As a result, the defence budget was reduced from $9bn in 2020 to $8bn in 2024, while the acquisition budget was dropped from $1.7bn in 2020 to $1.4bn in 2024.

However, according to GlobalData’s Oman Defense Market 2024-2029 report, the country’s defence expenditure is forecast to value $8.2bn in 2025 as it seeks to modernise its current inventory, keeping pace with regional neighbours such as Saudi Arabia, the UAE, and Bahrain.

Over the 2025–29 forecast period Oman is anticipated to grow at a CAGR of 2.6%, while the defence acquisition budget is expected to grow at 3.9% to record $1.7bn over the reporting period. The defence budget for 2029 is forecast to reach $9.1bn, with Oman’s Ministry of Defence expected to invest in land vehicles, fixed-wing aircraft, and ammunition.