(Xinhua)
Updated: 2007-11-24 10:06

Chinese Vice Premier Zeng Peiyan has urged the defense industry to strengthen its capabilities by facilitating technical innovation, either independently or through imported expertise.

Zeng spoke during a four-day tour to northwestern Shaanxi Province, which ended on Thursday.

Zeng visited defense enterprises and research institutes, urging them to achieve technical innovation by targeting market demand, deepening reform and accelerating the training of skilled personnel.

He said the defense industry should maximize its advantages in science and technology, as well as human talent, to contribute to the sustainable development of the economy.

Shaanxi is one of China's traditional bases for the defense industry, and the province aims to build an industry chain that centers upon space technology.

Shaanxi also wants to expand its expertise to information technology, new materials, new energy, software and equipment manufacturing.

The defense industry has become an economic engine for the province as more military manufacturers add profit-making civilian product lines.

Statistics from the Provincial Commission of Science, Technology and Industry for National Defense (CSTIND) showed that 20 of the 300 civilian products in mass production each generated more than 100 million yuan (about US$13.51 million) in sales last year.

The aggregate output generated by civilian products manufactured by the local defense industry has risen 11 percent annually since 2000, when it stood at from 5.6 billion yuan (US$757 million) to 10.2 billion yuan last year (US$1.38 billion).

Overall, the output of civilian-use products as a percentage of the total output of the national defense industry jumped from less than 10 percent in 1978 to 65 percent last year.

Nearly 200 civilian products each have yearly sales of more than 100 million yuan, and there are 20 products that generate at least 1 billion yuan a year.

No breakdown is available for military products.

Wu Xincheng, party secretary with the Shaanxi CSTIND, told reporters earlier this year that the state-controlled national defense industry is very likely to expand in the 11th five-year-plan period (2006-2010).

Since June, the government has promulgated several regulations to boost the defense industry. The moves it approved include allowing domestic and foreign investors to acquire shares in military firms of lower strategic value, including those that produce civilian products, and allowing some firms to raise funds in the capital markets.

The defense industry has also established more than 23,000 technical standards that help promote the integration of advanced technology in both military and civilian fields, according to Sun Laiyan, vice minister of the CSTIND.