China's defense-related science, technology and industry focuses on consolidating its foundation, making independent innovation, and speeding up the implementation of the strategy of transition and upgrading, so as to ensure the production and supply of military equipment and promote the development of national economy.

Improving the industrial structure, enhancing its capabilities of developing and producing new and high-tech weaponry and equipment. Defense-related science, technology and industry endeavors to accelerate structural adjustment in research and production, adopt advanced production modes, promote specialized production and upgrade processing technologies. Priority is given to R&D of new and high-tech weaponry and equipment, and endeavors to achieve breakthroughs in a number of key technologies and leapfrogging technological progress, thus speeding up weaponry and equipment modernization. Defense-related science, technology and industry is enhancing its core capabilities in R&D and production of the overall systems and key subsystems of major projects, and introducing more competition into the manufacturing and processing of general and supporting equipment, gradually establishing an all-round outsourcing system of cooperation for developing and producing weaponry and equipment. Priority is given to upgrading technologies and products in the nuclear, space, aviation, shipbuilding, weaponry, electronics and other defense-related industries, so as to form a cluster of high-tech industries to drive the growth of China's economy. In 2005, the output value, added value and gross revenue of the entire spectrum of defense-related science, technology and industry increased by 24.3 percent, 20.7 percent and 21.6 percent, respectively, over the previous year.

The defense manufacturing industries have been further informationized. The Tenth Five-Year Plan period saw the rapid development of digitalized manufacturing technology and wide application of computer-aided design, manufacturing and system-integrated manufacturing technologies in China's defense industries. The capabilities of master design and development, as well as of final assembly and integration, and the technological level of precision and super-precision processing were significantly raised. The means and methods of systems integration, experimentation and simulation, as well as of inspection and testing were upgraded.

The defense industry enterprises have stepped up restructuring and reform, and are exploring approaches for diversifying their ownership structure and steadily transforming themselves into share-holding enterprises. The reform of defense-related research institutes is being speeded up and greater support was given to research institutions engaged in strategic research, basic research and research in the public interest.

Strengthening capabilities of independent innovation. Efforts are being made to improve the innovative system of development and production of weaponry and equipment, and the innovative system of technology for high-tech industries combining military and civilian needs. The former takes master design, final assembly and manufacturing, and experimentation and verification as leading factors, and is supported by research and manufacturing of core systems and specialized equipment, and completed by an outsourcing system. The latter combines production, education and research, takes enterprises as the main body and research institutions as the mainstay, and is market-orientated. Priority is given to enhancing basic research, key technology research and frontier technology research. As a result, a number of state-of-the-art scientific and technological achievements that enjoy independent intellectual property rights have been made. Patent applications have increased rapidly -- at an average annual rate of over 40 percent. Major scientific and technological projects, such as manned space flights and the Lunar Probe Project, are being carried out to spur the leapfrogging development of high-tech enterprises combining military and civilian needs and to bring about overall improvements in defense-related science and technology. Platforms for developing weaponry systems, lab systems for defense-related science and technology, and research and application centers for advanced industrial technologies are being built. As a result, a fairly mature scientific and technological infrastructure is taking shape, which is well-configured, multi-functional, efficient and based on close cooperation between the military and civilian sectors. In addition, higher education and vocational education are being boosted for defense-related science, technology and industry. Three professionally specialized contingents are being constructed, namely, a contingent of business managers, a contingent of professionals and specialists and a contingent of skilled workers. Efforts are being made to establish an innovative mechanism to absorb and train high-caliber people for defense-related science, technology and industry.

On the premise of strictly honoring its international commitments, China encourages and supports participation in international cooperation and competition in civilian-military industries.