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Military

ANNUAL REPORT TO CONGRESS
Military Power of the People's Republic of China
2006

Chapter One
Key Developments

Several significant developments in China's national strategies and military capabilities over the past year relate to the questions posed by Congress in Section 1202 of the National Defense Authorization Act for Fiscal Year 2000 (P.L. 106-65). These developments include:

Grand Strategy, Security Strategy, and Military Strategy

  • Beijing released a White Paper entitled China's Peaceful Development Road in December 2005 to allay growing regional concerns over China's rise. China's military expansion - which provides an important context for understanding China's development - was not addressed.
  • China continued its strategy of building "comprehensive national power" with a declared emphasis on economic development. China's 11th Five-Year Plan (2006-2010), ratified during the March 2006 session of the National People's Congress, calls for a 20 percent reduction in per capita energy consumption by 2010, a doubling of China's 2000 Gross Domestic Product (GDP) by 2010, and an overall GDP of $4 trillion by 2020. The plan stresses coordinated, sustainable development and greater investment and urbanization in the rural interior to address widening income disparities and resultant social unrest.
  • Domestic protests, mainly directed at local policies and officials, have increased and, in some cases, become violent in recent years. The protests reflect popular dissatisfaction with official behavior related to property rights and forced relocations, labor rights, pensions, and corruption. They pose increased challenges to China's internal security forces.
  • China's dependence on imported energy and raw materials continues to grow. In 2004 China maintained its position as the world's second largest consumer and third largest importer of oil. Securing adequate supplies of resources and materials has become a major driver of Chinese foreign policy. Beijing has pursued stronger relations with Angola, Central Asia, Indonesia, states in the Middle East (including Iran), Russia, Sudan, Venezuela, and Zimbabwe to secure longterm resource supply agreements. Some of these countries are also recipients of Chinese military technology, raising questions over whether or not arms sales are used to facilitate access. China has also strengthened ties to countries that are located astride key maritime transit routes (e.g., the Straits of Malacca). PRC strategists have discussed the vulnerability of China's access to international waterways. Evidence suggests that China is investing in maritime surface and sub-surface weapons systems that could serve as the basis for a force capable of power projection to secure vital sea lines of communication and/or key geostrategic terrain.
  • In July 2005, Major General Zhu Chenghu, from the People's Liberation Army (PLA) National Defense University, stated to the press: "[In a cross-Strait confrontation] if the Americans draw their missiles and position-guided ammunition [sic] on the target zone on China's territory, I think we will have to respond with nuclear weapons." This is not the first time Zhu, or others, have threatened the United States with nuclear strikes in the context of conflict over Taiwan.
    • Following international criticism, the Chinese government formally disavowed General Zhu's remarks, stating that they reflected a personal opinion, and that China continues to adhere to a doctrine of "no first use" of nuclear weapons. This assurance was also conveyed to Secretary of Defense Rumsfeld during his October 2005 visit to China. Zhu's remarks, however, show that the circle of military and civilian national security professionals discussing the value of China's current "no first use" nuclear policy is broader than previously assessed.

  • China continues a systematic effort to obtain dual-use technologies through trade, commercial transactions, and joint ventures, particularly in the areas of software and integrated circuits industries that are vital for information-based, network-centric warfare. This trend, noted as a key finding in the U.S.-China Economic and Security Review Commission's 2005 Annual Report, is evidenced by increasing high-technology foreign investment and joint ventures in China and the concentration of export licenses destined for China in computer, electronics, semiconductor, telecommunications and information security technology.

Trends in China's Strategy in the Asia-Pacific and Other Regions of the World

  • In the past year, China continued its efforts to build influence in the Asia-Pacific region and beyond: China has publicly called for a "nuclear-free Korean Peninsula," and hosts the Six-Party Talks aimed at resolving the North Korean nuclear issue. China has unique potential, due to historical ties and geographical proximity, to convince North Korea to give up its nuclear ambitions.
  • Resource concerns played a role in increased Sino-Japanese tensions in the East China Sea, which flared last fall as PLA Navy vessels trained their weapons on Japanese Self Defense Forces aircraft monitoring Chinese drilling and survey activity in the disputed area.
  • In August 2005, China and Russia held a combined forces exercise, "PEACE MISSION 2005." The scenario was a UN-sanctioned intervention to separate combatants and restore order following ethnic disagreements in an imaginary country. Participants conducted off-shore blockades, paradrops, airfield seizures, and amphibious landings - all components of a Taiwan invasion plan. Russian forces included strategic bombers, advanced early warning, transport, refueling, and fighter aircraft along with modern naval vessels, suggesting the exercise also served as a showcase for Russian equipment to prospective Chinese buyers.
  • In July 2005, China and Russia secured a joint statement from the Shanghai Cooperation Organization's (SCO) Astana Summit calling for a date for the withdrawal of U.S. forces prosecuting the War on Terrorism in Central Asia, where Beijing hopes to reduce U.S. influence and gain greater foothold.
  • China remains a committed participant in the Asia-Pacific Economic Cooperation (APEC) and the Association of Southeast Asian Nations (ASEAN) Regional Forum. These two institutions, in which the Unites States participates, form the basis for East-Asian and Pacific regional architecture. Some of China's diplomacy was also geared to promoting regional institutions that would exclude the United States, however, such as the December 2005 East Asia Summit and the ASEAN+3 dialogue.
  • China made progress on resolving its border dispute with India, and the two countries affirmed their strategic partnership in April 2005. China seeks improved ties with New Delhi to both stabilize its periphery and balance improvements in U.S.-India relations. Beijing is encouraging New Delhi and Islamabad to reduce tensions while preserving China's longstanding strategic partnership with Pakistan.
  • China's foreign policy is now global. It engages in key issues in almost all international security and economic institutions, including the UN and the WTO. Its decision to deploy peacekeepers to several African countries and to Haiti and its growing economic ties in Latin America reflect this new global role. Of more concern are China's economic and political links with states such as Iran, Sudan, Burma, Zimbabwe, Cuba, and Venezuela, which are objects of international efforts to influence in the direction of nuclear non-proliferation, political reform, stability, and/or human rights. China also continues to use its growing leverage to restrict Taiwan's international roles and convince Taiwan's remaining 25 diplomatic partners to shift diplomatic recognition to Beijing.

The Security Situation in the Taiwan Strait

  • There were no armed incidents in the vicinity of the Taiwan Strait in 2005. Trends in the cross- Strait relationship in 2005 appeared to ease Beijing's concerns over Taiwan President Chen Shui-bian's 2004 re-election and stated plans to amend Taiwan's constitution by the end of his term in 2008. In early 2006, Beijing maintained a posture of restraint following President Chen's decision to suspend the National Unification Council and National Unification Guidelines. However, China's expansion of missile and other military forces opposite Taiwan has continued unabated, with the balance of forces shifting in the mainland's favor.
  • PLA amphibious exercises and training in 2005 focused on Taiwan. In September 2005 the PLA held one large-scale, multi-service exercise that dealt explicitly with a Taiwan invasion. China has conducted 11 amphibious exercises featuring a Taiwan scenario in the past 6 years.

Size, Location, and Capabilities of Chinese Forces Facing Taiwan

China is pursuing long-term, comprehensive military modernization to improve its capabilities for power projection and access denial. Consistent with a near-term focus on preparing for Taiwan Strait contingencies, China deploys its most advanced systems to the military regions directly opposite Taiwan.

Ballistic and Cruise Missiles.

The tempo of ballistic missile testing increased in 2005, indicating the priority China places on strengthening this force. China is developing qualitative upgrades to certain forces as well as methods specifically designed to counter ballistic missile defenses.

  • By late 2005, China had deployed some 710-790 mobile CSS-6 and CSS-7 short-range ballistic missiles (SRBMs) to garrisons opposite Taiwan. SRBM deployment continues to expand at an average rate of about 100 missiles per year. Newer versions feature improved range and accuracy.
  • China is modernizing its longer-range ballistic missile force by qualitatively upgrading and/ or replacing older systems with newer, more survivable ones. China is introducing a new road-mobile, solid-propellant, intercontinentalrange ballistic missile (ICBM), the DF-31 and the extended-range DF-31A, which can target most of the world, including the continental United States. These systems are supplemented by a new submarine-launched ballistic missile (SLBM), the JL-2, for deployment aboard the JIN-class (Type 094) ballistic missile submarine.
  • China is exploring the use of ballistic and cruise missiles for anti-access missions, including counter-carrier and land attacks, and is working on reconnaissance and communication systems to improve missile command, control, and targeting.

Air Power. China has more than 700 combat aircraft based within unrefueled operational range of Taiwan and the airfield capacity to expand the number of aircraft within this range. Although many aircraft are obsolescent or upgrades of older aircraft, new aircraft are a growing percentage of the inventory. China continues to acquire advanced fighter aircraft from Russia, including the Su-30MKK multi-role and Su-30MK2 maritime strike aircraft. China is producing its own version of the Su-27SK, also known as the F-11, under a co-production license with Russia. Last year, Beijing renegotiated this agreement to produce the multi-role Su-27SMK for the remainder of the production run.

  • According to the Defense Intelligence Agency (DIA), there were indications last year that China plans to organize a combat air wing for a future aircraft carrier, possibly based on the Russian Su-33/FLANKER D, a carrier-capable variant of the Su-27/FLANKER. Russia currently uses the Su-33 aboard Kuznetzov-class aircraft carriers.
  • China's indigenous fourth-generation fighter, the F-10, completed development in 2004. DIA estimates production of 1,200 aircraft over the life of the program. Reported to be similar in weight and performance to the Eurofighter Typhoon or Dassault Rafale, newer variants of the F-10, the F-10A, and Super-10, now under development, feature improved weapons, engines, and radars.
  • Improvements to the FB-7 fighter program will enable this older aircraft to perform nighttime maritime strike operations and to use improved weapons such as the Russian Kh-31P anti-radiation cruise missile and KAB-500 laserguided munition.
  • China is developing special mission aircraft, including the KJ-2000 airborne warning and control (AWACS) aircraft, based on the Russian IL-76 transport platform. China is also modifying the Y-8/CUB transport into a variety of platforms, including Airborne Battlefield Command, AWACS, and intelligence collection.

Naval Power. China's naval forces now include 75 major surface combatants, some 55 attack submarines, about 50 medium and heavy amphibious lift vessels (an increase of over 14 percent from last year), and approximately 45 coastal missile patrol craft.

  • China has received its first of two Russian-made SOVREMENNYY II guided missile destroyers (DDGs), with the second expected by the end of 2006 or early 2007. These DDGs are fitted with advanced anti-ship cruise missiles (ASCMs) and sophisticated, wide-area air defense systems, which represent a qualitative improvement over China's earlier SOVREMENNYY-class DDGs purchased from Russia.
  • China's SONG-class diesel electric submarine is in serial production. The SONG is designed to carry the YJ-82, an encapsulated ASCM capable of submerged launch. In 2004, China launched a new diesel submarine, the YUAN-class. China's next-generation nuclear attack submarine, the SHANG-class (Type 093) SSN, is now entering the fleet.
  • China is acquiring eight additional KILOclass diesel electric submarines from Russia to augment the four previously purchased units. The new KILOs are equipped with the supersonic SS-N-27B ASCM, and wire-guided and wakehoming torpedoes.
  • In 2005, the PLA Navy (PLAN) launched its newest ship, the LUZHOU-class (Type 051C) DDG. Designed for anti-air warfare, it is equipped with the Russian SA-N-20 SAM system, controlled by the TOMBSTONE phasedarray radar. The SA-N-20 more than doubles the range of current PLAN systems.
  • The LUZHOU-class DDG complements ongoing developments of the LUYANG I (Type 052B) DDG (similar to the SOVREMENNYY) and LUYANG II (Type 052C) DDG. The LUYANG I is fitted with the Russian SA-N-7B GRIZZLY SAM and the YJ-83 ASCM. The LUYANG II is fitted with an integrated air defense system and the indigenously-produced HHQ-9 SAM.

Air Defense. In addition to the shipborne air defense developments listed above, in 2004 China purchased the Russian-made S-300PMU-2. The first battalion is expected to arrive in 2006. With an advertised intercept range of 200 km, the S-300PMU-2 provides increased lethality against tactical ballistic missiles and more effective electronic counter measures.

Ground Forces. China has 400,000 ground force personnel deployed to the three military regions opposite Taiwan, an increase of 25,000 over last year. China has been upgrading these units with tanks, armored personnel carriers, and a substantial increase in the amount of artillery pieces.

  • In December 2005 the PLA completed another round of downsizing, reducing personnel by some 200,000. This brought the size of the PLA to about 2.3 million, according to official statistics. The inclusion of the paramilitary People's Armed Police (which has upwards of 1.5 million personnel) and reserves (800,000) increases the total figure for active, reserve, and paramilitary units to over 4.6 million. The 2004 Defense White Paper also declares that China can draw upon more than 10 million organized militia members.

Developments in Chinese Military Doctrine

  • In October 2005, China announced that it completed a translation of the 2001 edition of the Science of Strategy (ZhanlŘexue), giving English-language readers better insight into official Chinese views of modern warfare.
  • China is digesting lessons learned from Coalition military operations in Afghanistan and Iraq, as well as the international response to the December 2004 Asian tsunami. China can be expected to incorporate these lessons into updated military doctrine, planning, and acquisition programs.

Technology Transfers and Acquisitions to Enhance Military Capability

  • China has maintained pressure on the European Union (EU) to lift its embargo on the sale of arms to China, which the EU established in response to the Tiananmen crackdown in 1989. An EU decision to lift the embargo would, in the U.S. view, weaken the restraints on EU member states' transfers of arms and other technologies with military application to China. Chinese access to advanced European military and dual-use technologies could result in new weapon systems entering into China's inventory and an increase in the quality of, and production capabilities for, current and future systems.
  • China signed a contract in September 2005 to acquire approximately 40 IL-76 transport planes and 8 IL-78/MIDAS air refueling aircraft from Russia. These aircraft will increase PLA Air Force strategic lift capacity, in particular, the ability to airdrop troops and fighting vehicles. The refueling aircraft will extend the range and strike potential of China's bomber and fighter aircraft.
  • China continues to employ covert and illegal means to acquire foreign military and dualuse technology. Individuals allegedly engaged in illicit technology transfers to China were arrested in the United States and Russia in the fall of 2005.

Assessment of Challenges to Taiwan's Deterrent Forces

  • The cross-Strait military balance is shifting in the mainland's favor as a result of Beijing's sustained economic growth, increased diplomatic leverage, and improvements in military capabilities based within striking range of Taiwan.
  • Taiwan's defense spending has steadily declined in real terms over the past decade, even as Chinese air, naval, and missile force modernization has increased the need for defensive measures that would enable Taiwan to maintain a credible self-defense.
  • In 2005, Taiwan leaders stated their intention to reverse this trend and increase defense spending to three percent of GDP by 2008.
  • The Special Budget for procurement of major defense systems, designed to correct growing imbalances in the critical areas of missile and air defense and anti-submarine warfare, has been before the Taiwan Legislative Yuan since 2004. The United States approved these systems for sale to Taiwan in 2001.
  • The United States continues to make available defense articles, services, and training assistance to enable Taiwan to maintain a sufficient selfdefense capability consistent with the provisions of the Taiwan Relations Act, Public Law 96- 8 (1979). In December 2005 the Taiwan Navy accepted delivery of the first two of four KIDD-class DDGs.



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