An unclassified report by the Defence Intelligence Agency said Beijing has made military strides in recent years, thanks partly to domestic laws forcing foreign partners to divulge technical secrets in exchange for access to China's vast market.
"Beijing's longstanding interest to eventually compel Taiwan's reunification with the mainland and deter any attempt by Taiwan to declare independence has served as the primary driver for China's military modernization", DIA Director Robert Ashley said.
The report released Tuesday by the Defense Intelligence Agency said China saw a almost threefold increase in defense spending from 2002 to 2018.
"China shifted funds and efforts to acquiring technology by any means available".
"Rather, China has routinely adopted the best and most effective platforms found in foreign militaries through direct purchase, retrofits, or theft of intellectual property".
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"The result of this multifaceted approach to technology acquisition is a PLA (People's Liberation Army) on the verge of fielding some of the most modern weapon systems in the world", the report says. "In some areas, it already leads the world", the report said.
Speaking to reporters in Washington on Tuesday, a senior defense official admitted that he was anxious about China now having the confidence to pull off major military moves - such as invading Taiwan.
"The biggest concern is that as a lot of these technologies mature".
"China has been investing billions of dollars, possibly as much as $200 billion past year, into its military, which Chinese leadership is putting through a massive overhaul in hopes of building a modern, world-class fighting force capable of waging and winning wars".
These bases, and other improvements to the PLA's ability to project power during the next decade, will increase China's ability to deter by military force and sustain operations overseas, the report said. This includes a wide range of missiles and deployment systems, including a vehicle that launches ballistic missiles specifically against aircraft carriers.
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It also mentions how China has "closed numerous gaps in key warfare areas" in recent years, through building or acquiring advanced platforms such as submarines, missile patrol crafts and land-based systems that carry antiship cruise missiles, in order to deter Taiwanese independence or provide "a range of tailored military options against Taiwan and potential third-party military intervention" if an attack were deemed necessary.
But Beijing considers it to be a wayward province and has never ruled out military force to bring it under control. "The challenge, of course, is for measuring against a globally active USA military that has many different missions and many different tasks, so I think there's a very long way for the PLA to reach that level". "We reserve the option for all the necessary means".
Taiwanese President Tsai Ing-wen refused to acknowledge a "one China" solution and said she will not back down, despite losing re-election to a more Beijing-friendly opponent.
China's territorial claims in the resource-rich South China Sea are driving major logistic developments in the Spratly and Paracel Islands.
"I think both sides have managed to operate professionally".
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The 140-page report, published Tuesday, is titled "China Military Power: Modernizing a Force to Fight and Win".