Funding Boost for China's Military

China's military is to receive another hefty budget increase, with a 17.6% rise in funding to beef up its capabilities and ease the lives of more than two million troops, it emerged today.

Soldiers will get better training, higher salaries and better meals as spending rises from 350bn yuan (£25bn) to 418bn yuan.

But some of the cash will go on hardware, allowing China to conduct a war "under IT-based conditions" capacity, Jiang Enzhu, a spokesman for the country's parliament told agency reporters.

Speaking before the opening session of the National People's Congress tomorrow, he said the rise was "moderate" because it came from a low base, despite a substantial increase last year.

The news comes the day after a Pentagon report expressed concerns about the development of China's military, including an apparent rise in cyber-espionage as well as its increased strike capacity and testing of an anti-satellite weapon last year.

It argued that the People's Liberation Army was "pursuing comprehensive transformation from a mass army designed for protracted wars of attrition on its territory to one capable of fighting and winning short-duration wars along its periphery against high-tech adversaries".

It also suggested China's true defence budget was two to three times the official figure last year. That would still leave it well below the United States budget, which has also risen substantially to $623bn (£314bn) for 2008.

Jiang told reporters: "In recent years the Chinese government has moderately increased its spending on national defence on the basis of sustained, steady and fast economic growth and rapid build-up of government revenues.

"These increases were of a compensatory nature to make up for the weak defence foundation."

Jiang said China's military spending was 1.4% of its gross domestic product last year, compared with 4.6% in the US and 3% in Britain.

The budget rise prompted Japan's defence ministry to urge China to enhance transparency and address international concerns.

Figures for 2006 from the Stockholm International Peace Research Institute suggest China lagged behind the US, UK and France in total spending, but in purchasing power parity was second to the US, spending the equivalent of $188bn to the US's $529bn.

Trefor Moss, Asia Pacific editor at Jane's Defene Weekly, said it was hard to know the true scale and nature of the country's military development, but added: "For a long time China's spending was clearly quite tiny comparatively, and the army was quite basic. They are a long way behind in terms of military hardware but are clawing back some ground. Their IT capacity is probably further ahead because they are stronger there and the Pentagon has had a lot of concerns."

Jiang also renewed China's warnings to Taiwan that its plans for a referendum on United Nations membership, to coincide with the presidential election this month, was putting the difficult relationship under further strain. He said the island would pay a "heavy price" if the public endorsed the motion.