Even in PPP dollars, China is not projected to become twice the size of the United States before mid-century (PWC 2017 projects 2050 PPPs in 2016 USD for USA and China at 34 and 58 trillion dollars respectively). And while there are certainly elements of the military apparatus that are sensitive to local price conditions (in the way that PPP tries to capture), most significantly personnel costs, I believe that market exchange rates provide a superior basis for comparison, for two main reasons: fuel costs (a major input into operational costs) are more or less the same between nations, and the further one ascends up the technological chain, the greater the degree of convergence in both wages and material costs.
A strict PPP comparison will overestimate China's military-economic resources for the reasons noted above, while a strict MER comparison will underestimate those resources by failing to account for lower personnel costs. A hybrid or approximation of the two measures, therefore, is likely to be more accurate than either alone, although that still leaves open the question of the appropriate ratio.
Applying a crude 50/50 approximation of MER and PPP measures, using PWC 2017 projections for future economic growth, and assuming that defence allocations as proportion of GDP remain equivalent to the 5yr average of 2011-2016 (as estimated by SIPRI 2017) , generates the following "comparable" figures of defence expenditure in 2030:
USA (3.8%): $892bn
China (1.9%): $613bn
India (2.5%): $342bn
Russia (4.4%): $151bn
In summary, I disagree with the PWC methodology as it is not very good.
The key thing is the actual volume of goods and services that an economy produces, which is best measured by PPP.
And as of 2017, the IMF have the Chinese PPP economy at almost 20% larger than the USA, and the Chinese economy is still growing much faster as it is still less developed overall.
So by 2035, it is not a stretch to say that China's economy (as measured by PPP) will be twice that of the USA. Even by that projection, the average Chinese person will only be half as wealthy as their US equivalent, and China should still have lower costs overall.
And in the long run, the actual exchange rate should converge to the PPP exchange rate in a liberal trade and investment environment.
China is already the world's largest market for most categories of goods and services. And that market is one of the most ruthlessly competitive in the world, which is well on the way to forcing companies to become world-class in terms of cost, quality, technology etc
In terms of military spending, China is self-sufficient except in a few key technologies. So the exchange rate doesn't matter, and China benefits from procurement costs which look like half that of the equivalents in the US/Europe.
With reference to fuel costs, they don't actually have much of an impact of military spending. I recall a US Navy study where fuel accounts for 10%-20% of the total lifecycle cost for the Burke.
And remember that China moving rapidly to a future where electric vehicles and energy production means petrocarbons have a very small role,