TAIPEI: Taiwan's President Lai Ching-te said Wednesday he will put forth a special USD 40 billion budget for arms purchases, including to build a Taiwan Dome, an air defence system with high-level detection and interception capabilities, in the face of US pressure for the island to increase its defence spending.

The budget will be allocated over eight years, from 2026 to 2033, and comes after Lai already pledged to raise defence spending to 5 per cent of the island's GDP.

Currently, Taiwan has budgeted an increase in its defence budget to 3.3 per cent for 2026, allocating TWD 949.5 billion (USD 31.18 billion).

Lai had previewed the announcement in an op-ed for the Washington Post on Wednesday, saying the special budget would be used to purchase arms from the US.

Wellington Koo, Taiwan's minister of national defence, said Wednesday the USD 40 billion is an upper limit for the special budget and that it will be used to buy precision-strike missiles and toward the joint development and procurement between Taiwan and the US of equipment and systems.