HANetf will expand its regional defence fund offerings with a new Indo-Pacific ex-China ETF set to launch in July 2025.
The ETF will provide targeted exposure to Indo-Pacific-listed firms in the defence, aerospace and security sectors. It joins the firm’s existing defence range, including the $2.6bn HANetf Future of Defence UCITS ETF and the €130m HANetf Future of European Defence UCITS ETF.
The launch comes amid rising defence spending and greater focus on military industrial policies across the Indo-Pacific. Countries such as India, Japan, South Korea and Taiwan are increasing their defence budgets and seeking greater self-reliance in arms production.
The new ETF will track the VettaFi Future of Defence Indo-Pac ex-China index, which focuses on companies domiciled in the Indo-Pacific with significant defence revenues. Top constituents include Singapore Technologies Engineering, Kawasaki Heavy Industries and Mitsubishi Heavy Industries, with the biggest geographical allocations being South Korea (45.3%), India (28.9%) and Japan (9.6%).
At the Shangri-La Dialogue in Singapore, US defence secretary Pete Hegseth encouraged Asian allies to follow Europe’s lead, citing NATO members pledging 5% of GDP to defence spending.
Among the regional defence drivers highlighted by HANetf are Japan initiating its largest military build-up since the 1950s, India directing three-quarters of its defence capital budget to domestic manufacturers and South Korea expanding its defence exports with the aim of taking 5% of the global arms market by 2027.
Hector McNeil, co-founder and co-CEO of HANetf, said: “The Indo-Pacific is fast becoming the geopolitical centre of gravity for the 21st century. From Taiwan to the Indian Ocean, rising tensions and a shift toward defence self-reliance are driving a historic rearmament cycle.
"Just as our NATO and European Defence ETFs have helped investors access the new realities of global security, this strategy offers targeted exposure to companies within the Indo-Pacific region.”