CHINA'S NAVAL MODERNIZATION AND ITS IMPLICATIONS FOR MOSCOW AND WASHINGTON

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP04T00794R000200660001-5
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 27
• Document Creation Date: December 22, 2016
• Document Release Date: July 14, 2011
• Sequence Number: 1
• Publication Date: April 1, 1986
• Content Type: REPORT

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Directorate of
Intelligence
China's Naval Modernization
and Its Implications for
Moscow and Washington
EA 86-100/.3)
Apri! 1986
~?pv ~ 1 5
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Directorate of
Intelligence
and Its Implications for
Moscow and Washington
China's Naval Modernization
Office of East Asian Analysis, with a contribution
from Office of Soviet Analysis.
Comments and queries are welcome and may be
directed to the Chief, China Division, OEA~
This paper was prepared by
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Top Secret
EA 86-100/3J
April 1986
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and Its Implications for
Moscow and Washington
China's Naval Modernization
Key Judgments The Chinese Navy is adopting astrategy-first enunciated in 1983-of a
/rJormation available more forward or "active" defense for China's 14,500-kilometer coastline.
as of /5 March 1986 Whereas China's outer perimeter of naval defense traditionally reached
was used in this report.
only 500 kilometers from the coast, we believe that Beijing now envisions a
defense that begins with submarines and long-range bombers some 900
kilometers from the Chinese landmass. Chinese Navy planners hope to
extend this perimeter and speak of a Navy that, by the 1990s, would be ca-
pable of routine operations 2,000 kilometers off the coast.
This new strategy, which allows greater depth to inflict losses, rests on new
weapons, more aggressive patrolling by Chinese submarines, and an
increased emphasis on professional training. Beijing is close to deploying
two new antiship missiles-an Exocet-like, solid-propellant missile and an
80- to 100-kilometer-range, liquid-propellant, air-to-surface missile-that
will allow Chinese crews to launch missiles at extended ranges. In addition,
the Chinese are buying Italian deep-diving torpedoes, building new
frigates, and refitting older destroyers for antisubmarine warfare (ASW)
operations.
marine warfare, air defense, and early warnine are annarent:
Although the Chinese have made significant progress in obtaining new
weapons for the Navy, Beijing lacks the advanced weapons to ensure a
credible deterrent to Soviet naval attack. Serious deficiencies in antisub-
Top Secret
EA 86-100/3J
Apri l 6
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China's deficiencies in weapons development could translate into some new
opportunities for the United States to build on the nascent US-PRC
defense relationship.
But any movement in this area is likely to stop short of strategic
cooperation or close military coordination. In general, Beijing is still
reluctant to take overt steps that would undercut its claim of pursuing an
independent foreign policy or that would further complicate its relations
with Moscow. And, in our view, the Chinese leadership remains divided
over how far to go in forging direct military links to the United States.
Beijing seeks technology rather than finished weapons and is often
dismayed by the high costs-even with coproduction arrangements-and
technological limits set by Washington on arms transfers. Beijing, there-
fore, will seek to exploit the rift between the United States and other
Western nations on arms sales to China by luring the Governments of
Israel, Britain, Italy, and France.
China's severely limited defense budget will continue to be the paramount
constraint on the pace of weapons acquisitions from the West and overall
naval modernization. With economic modernization continuing to take
precedence, China's armed services compete vigorously for shares of a
relatively small military procurement budget. Navy Commander Liu
apparently has fought successfully for some new weapons production for
the Navy, but the equally pressing needs for modernization of ground and
air forces are likely to keep naval imports restricted to a very few key areas
for many years.
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Although Beijing's more aggressive naval strategy is primarily defensive,
the weapons under development will improve China's ability to project
power against the weaker nations on its periphery. Taiwan will feel
especially threatened-particularly as Beijing's capability to successfully
blockade the island improves-and Taipei will seek additional US assis-
tance to restore the naval balance. Concern among other non-Communist
states in East Asia is also certain to grow; both Indonesia and Malaysia are
wary of Beijing's growing regional strength, and Japan already has
expressed reservations in COCOM to the transfer of advanced naval
systems-including US torpedoes-to China. They are certain to voice
their concern to Washington and to seek assurances on how much the
United States is willing to help China. In the case of Vietnam, Hanoi may
press the Soviet Union for more advanced warships, which Moscow
probably will attempt to parlay into greater access to Cam Ranh Bay.
Although naval modernization somewhat improves Beijing's power projec-
tion options, China is in no position seriously to threaten US interests in the
Pacific. Beijing appears to have no plans to build the large warships needed
for distant power projection, and China's naval training is wholly defensive.
Beijing has few illusions about
building a "blue water" navy and, although the Chinese Navy hopes to ex-
tend the range of its naval operations, its mission remains largely defensive.
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Key Judgments
Beijing Feels the Heat
The Navy Adopts "Active Defense"
New Weapons and Equipment: The Key to the New Strategy 7
Antisubmarine Warfare Systems 10
Air Defense Weapon Systems: A Major Weakness 11
The New Dependence on Western Technology 12
The Push for US Technology 12
Future Systems 12
Can the New Strategy Work? 14
Implications for the United States 15
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China's Naval Modernization
and Its Implications for
Moscow and Washington
The upgrading of China's conventional armed forces
continues to be an important objective for Chinese
leader Deng Xiaoping. First enunciated in 1975,
military modernization was slow until Deng's acces-
sion to the chairmanship of the Central Military
Commission in 1980. In 1981 Deng and his supporters
instituted a new defense strategy for China's industri-
al northeast that relies heavily on a modernized army
with greater firepower and mobility.' Since then, the
Military Commission has trimmed the size of the
armed forces, dramatically improved military educa-
tion and training, increased funding for weapons
development, and improved the quality of weapons.
Last year, for example, Beijing undertook sweeping
changes to the standing military when the Military
Commission announced atwo-year program of troop
cuts to trim the armed forces by about 1 million men.
China's desire to modernize its military is spurred by
the impressive buildup of Soviet power in the Far
East. Before 1964, 13 Soviet ground-combat divisions
with some 2,500 tanks and armored vehicles were
deployed on China's border. Today, there are 49
active ground-combat divisions and over 30,000 tanks
and armored vehicles there. As a result, China's
ground forces had first priority for modern weapons
and equipment. Over the past few years, Beijing has
fielded new types of tanks, armored vehicles, self-
propelled artillery, antitank missiles, and air defense
weapon systems to improve its Army's chances
against better equipped Soviet forces.
The growth of Soviet naval forces in the Far East is
also compelling Beijing to modernize its 1,300-ship
Navy (see inset). High-ranking Chinese officials have
publicly called for speeding up the modernization of
the Navy to protect China's maritime interests, and
Liu Huaqing, commander of the Chinese Navy and a
key architect of China's naval modernization, has on
several occasions described the building of a modern
Navy as an urgent and strategic task in China's
national defense construction. In January, Liu stated
that the most important task in the Navy's modern-
ization is the production and deployment of new, more
sophisticated weapon systems. Despite limited fund-
ing, these and other statements by Chinese political
leaders suggest that Beijing is ready to provide re-
sources for equipping the Navy with advanced hard-
ware and for training a new generation of officers.
Beijing Feels the Heat
Beijing rarely voices its concern over Moscow's expan-
sion of Pacific power, but is candid in closed-door
discussions. While publicly claiming that the Soviet
naval buildup is directed mainly against the United
States and its allies in the Pacific, high-ranking
Chinese officers have privately conceded that the
buildup poses a grave threat to China. According to
the told
US Navy Secretary Lehman last August that Viet-
namese forces regularly exercise with the Soviet
Navy, and that China views this collaboration as
threatening to its sea lines of communication. Xu Xin,
a deputy chief of general staff, expressed similar
concerns to high-level US officials last November
over the buildup in the Pacific Fleet and, in particu-
lar, the growth of Soviet air and naval forces at Cam
Ranh Bay.
Moscow's warming relations with North Korea are
also adding to China's perception of growing Soviet
power in the region. Beijing International Institute of
Strategic Studies (BIISS) officials complained to US
visitors last fall about Soviet intelligence collection
flights over North Korea and admitted that Beijing
had scrambled fighters in reaction to the Soviet
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Figure 1. The 37,000-metric-ton Kiev-class aircraft carrier (top
IeftJ can carry 32 aircraft and helicopters. /t is also equipped with
/6 SS-N-12 surface-to-surface missiles that have a maximum
range of 550 kilometers (kmJ, and carries over l00 surface-to-air
missiles with ranges out to 40 km.
including the /40-km-range SA-N-6. The ship is also armed with
10 SS-N-/9surface-to-surface missiles that can strike targets as
jar away as 550 km.
The Sovremenny-class destroyer (bottom) carries the 130-km-
range SS-N-22 surface-to-surface missile and the 40-km-range
SA-N-7 surface-to-air missile. ~~
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The 28,000-metric-ton Kirov-class nuclear-powered cruiser
Frunze (top righiJ carries over 150 surface-to-air missiles,
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Since 1979, Moscow has added over 25 submarines
and principal surface combatants to the Pack Fleet,
including some ojits newest, most powerful ships:
? The Soviets have augmented the Pacific Fleet's
aging November-class nuclear powered attack sub-
marines (SSNsJ with I1 new V-III-class SSNs.
? The Pacific Fleet has two Kiev-class VTOL aircr~t
carriers and was given its first Kirov-class cruiser
and Sovremennyy- and Udaloy-class guided-missile
destroyers in 1985.
? The Soviets have upgraded the Pacific Fleet's naval
aviation in the last jive years with two Backfire
bomber regiments, an SU-17 Fitter fighter-bomber
regiment, and increasing numbers of antisubmarine
warfare helicopters.
Soviet naval forces
at Cam Ranh include three to jour submarines, two
missile-equipped combatants, jour small ASW ships,
and two coastal minesweepers that form the core oja
permanently deployed squadron. The Soviets also
have a composite air regiment at Cam Ranh, com-
posed of jour to eight Bear ASW and reconnaissance
aircrctl't, 16 Badger bombers, and 14 MIG-23 air
defense fighters. The missile-equipped combatants
and MIG-23 fighter aircr~jt were added in the last
two years and have considerably strengthened Soviet
defenses there.
and aircruj't.
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had lodged a
formal complaint with Pyongyang, calling the Soviet
overflights a threat to China's security.
that athree-year program of building up China's
border and coastal defense facilities had been com-
pleted.
A Japanese source told US military officials
movements of Soviet warships.
last year that China plans to use a combination of
destroyers, aircraft, and submarines to monitor the
Beginning in
began to refer to a
more extended defense or "active defense" as the
Navy's new strategy. In the words of one Navy staff
officer, "The Navy's strategy is still one of coastal
defense, although we have moved some of our opera-
tions farther out to sea, extending our defensive
perimeter."
from shore than previously planned.
that, to accomplish this
strategy, the Navy believed it needed to be capable of
operating 1,850 km offshore. Active defense, as de-
fined by another officer; "shortens the distance to
battle," indicating that in a conflict the Chinese Navy
wants to engage enemy warships at greater distances
The new strategy of active defense has, in our judg-
ment, already extended the defensive perimeter an-
other 370 km from the Chinese coastline. Although
the lack of effective air defenses still restricts China's
destroyers and frigates to operating within the range
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of land-based airpower, Chinese submarines are pa-
trolling more aggressively, farther from home. They
are operating about 900 km offshore near the critical
choke points leading into the East and South China
Seas. This suggests that they will try to blunt a Soviet
Beijing has not conducted similarly large exercises
since 1983 probably because of budgetary constraints.
Nevertheless, the Chinese Navy has stressed the
integration of aircraft and submarines with surface
To implement this more forward-looking defense
strategy, Beijing has embarked on an impressive
reform of its training procedures and organization.
Naval schools and academies closed during the 12
years of the Cultural Revolution (1965-76) have re-
opened; younger, better educated officers are being
selected to captain the Navy's warships; and the
Chinese Navy is training in large-scale, complex
exercises. The progress in naval training was summed
up in the official Chinese media in January: "The
good situation of naval fleet training in 1985 was rare
in previous years. In particular, the Navy attached
importance to long cruise and redeployment training,
intensified combined tactical exercises, and further
enhanced the combat effectiveness of naval fleets."
Before 1982, the Chinese Navy had little experience
in large exercises featuring air, surface, and subsur-
face units in opposing forces scenarios. For the first
time, in the spring of 1982, and again in both the
spring and fall of 1983, Beijing conducted large,
multiforce exercises in the North Sea Fleet:
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Figure 4. A Chinese B-6
bomber armed with two
air-to-surface missi/es~
? China conducted its first foreign port calls and New Weapons and Equipment: The Key
deployment to the Indian Ocean in 1985. A Navy to the New Strategy
destroyer and oiler left Chinese coastal waters on 17
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November and entered the Indian Ocean on the Beijing is developing advanced weapons that will 25X1
29th. Port calls occurred in Sri Lanka (8-13 Decem- considerably strengthen the Navy's ability to imple-
ber), Pakistan (18-23 December), and Bangladesh ment the strategy of active defense.
(26-30 December).
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China has produced four of25X1
the ASM-capable bombers. We believe that each
B-6D is capable of carrying two ASMs.~~ 25X1
These voyages give young Chinese naval officers This antiship ASM will give China's naval aviators
considerable at-sea experience and allow Beijing to their first standoff weapon against ships. Exploiting
use its naval forces to show the flag to the Soviets and the B-6 bomber's long range and speed, the Chinese
the rest of the world. We believe that the value of
these voyages for naval training and as a diplomatic
tool will persuade Beijing to increase the frequency of
such long-distance cruises.
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ASM provides naval aircraft with the capability to
strike at enemy warships well out to sea-a key
requirement of active defense.
China is also fielding a new antiship missile for its
warships. Under development since 1978, the solid-
propellant CSS-NX-4 is similar to the Frencet
and, according to information obtained by th
has a range of about 50
km. US defense attache reporting indicates that the
antiship missile's use will be widespread and the
missile could be operational as early as next year:
hina
launched its first major surface combatant equipped
with the CSS-NX-4. The warship, a 1,700-metric-
ton Jianghu frigate, carries eight of the new antiship
missiles. More of these modified frigates are likely
to be built.
(will soon begin building
Osa-class guided-missile patrol boats equipped with
the Exocet-like missile. Larger than the Hoku, now
used as the platform for testing the missile, Osas
can carry eight CSS-NX-4 missiles.
With the Exocet-like missile, China's R-class subma-
rines, which provide the outer perimeter of China's
naval defense zones, become even more effective.
for a torpedo attack.
They are Beijing's"only credible naval defense against
enemy task forces with standoff strike capability, and,
by acquiring its own standoff capability, China's
submarine fleet will be able to strike surface targets
from 50 km away, instead of the 4 to 8 km required
The middle and inner rings of China's defense zones
also will be reinforced by the CSS-NX-4. Beijing is
likely to replace many of the outdated liquid-propel-
lant Styx missiles ^-China's main shipborne surface-
to-surface missile-on Chinese destroyers, frigates,
and missile patrol boats with the CSS-NX-4 because
of its substantial advantages:
? The CSS-NX-4's sea-skimming abilities and its
small size make it far more difficult to detect on
approach and destroy.
? The greater safety of the CSS-NX-4's solid-
propellant fuel raises the readiness level of ships
that could fuel their Styx missiles only just before
combat. The CSS-NX-4 may also allow reloading
of launchers at sea.
? The CSS-NX-4's size-roughly half that of the
Styx-allows Beijing to double the number of mis-
sile launchers aboard each warship.
In our judgment, the flexibility and versatility of the
CSS-NX-4 will lead Beijing quickly to adapt the
missile for air delivery. China's first air-launched
ASM is based on the large, heavy Styx missile and is
not suitable for lightweight fighters. With its smaller
size and weight, the CSS-NX-4 not only will allow
B-6 bombers to carry more missiles and attack multi-
ple targets on a single mission, but it can also be
mounted on smaller aircraft, such as China's A-5
ground attack fighter
' The Chinese probably will retain the Styx missile-with its longer
range and greater destructive power-for land-based coastal de-
fense and possibly as a second missile system aboard larger surface
combatants.) I
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Antisubmarine Warfare Systems
Beijing is also seeking to improve its antisubmarine
warfare (ASW) capability.
credible airborne ASW capability, however, and the
ASW weapons and sensors on its current warships are
inadequate to detect, track, and defeat modern, deep-
diving Soviet submarines. For the past several years,
acquiring ASW hardware has been a major priority:
China had launched its first major combatant
eauinned with a helicopter deck. According to the
the Jianghu frigate
sions.
probably will carry the French Dauphin helicopter
and Western electronic equipment for ASW mis-
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Air Defense Weapon Systems: A Major Weakness
Despite progress in other areas, China has done little
to improve its air defense weapons over the past few
years. Chinese warships still possess no surface-to-air
missiles, and Beijing's indigenous SAM program-
under development since the mid-1970s-appears to
be a failure. The Chinese Navy, however, is working
to overcome some of its air defense weakness by the
addition of radar-controlled, rapid-fire guns on its
warships:
? In 1983, China fielded a copy of aSoviet-designed
30-mm rapid-fire antiaircraft gun on an Osa-class
patrol boat. The gun is capable of firing up to 1,000
rounds per minute and is controlled by a new,
indigenously designed fire-control radar. Although 25X1
the Chinese have encountered difficulties in mating
the gun to the radar, at least 13 Osas have been
fitted with the new gun.
modified Jianghu frig- 25X1
ates also will carry four of the 30-mm guns.
? China's new frigates also will be equipped with a
rapid-fire 100-mm gun based on French technology.
China bought two 100-mm Compact rapid-fire guns
from France in 1983 and may have adapted aspects
of the French gun for a Chinese 100-mm gun
already under development. 25X1
suggests that Beijing has been testing a 100-mm
gun at a munitions test center in northern China.
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Major Naval Imports From
Beijing's progress in naval modernization depends the West, 1983-85
heavily on access to Western technology. In the past,
this was accomplished mainly through the illegal
diversion of Western technology to China-as is
probably the case in Beijing's acquisition of a French Cost Equipment
Exocet from Pakistan to reverse-engineer the (million US 81
CSS-NX-4. More recently, the purchase of Western 1983
naval technology from foreign companies and govern- Total tb.s
menu has played a key role in China's naval modern- France 1.9 Two Fenelon submarine
ization. Since 1983, China has accelerated its pur- s?nars
chases of naval-related weapons and technology from 12.1 Two 100-mm rapid-fire
.,_ _ .., - ~'- . _ ~ m.,~ . __ ??? .'- -'' naval guns
equipment~~ Moreover, as Beijing strives to .,...`.," v`""~ ~.~ launchersv.,?v V.?"'.
overcome deficiencies in key mission areas such as 1984
antisubmarine warfare and air defense, we believe its Total 23.5
purchases of foreign technology will increase substan- France 4.0 Two HS-12 helicopter
0.4 Integrated shipborne
The Push for US Technology communications system
Diplomatic and Italy 7.5 Two shipborne electronic
,uarfarP ~.~~rPrr,~
tec no ~'or its naval modernization. In technical """`" ""'6"~"' ~" ' ~~`" ""'"' '"""'? """
tactical displays
discussions with the US Navy over the past two years, 9.4 Five integrated communica-
the Chinese have focused primarily on ASW technol- bons systems
ogies: the Mk 46 Mod 2 ASW torpedo, the Raytheon 2.o Antenna for use with
DE-1167 sonar, and the Lamps Mk-1 ASW helicop- commnnications systems
ter. Beijing has also expressed interest in US air 1985
defense weapon systems such as the Phalanx rapid- Total 247.2
fire gun and the Standard shipborne surface-to-air France 4.2 Maintenance equipment for
__.__.,_ ._ r--r.~ 100-mm guns
in ship design and systems integration for future- ""'~ ~ `"?''""v""`"' """"
helicopters
generation naval vessels. Thus far, however, the sale united States 200.0 Five LM-2500 gas turbine
of only a limited number of Mk 46 torpedoes is engines
pending, and discussions with the Chinese for copro- Italy 19.7 Forty A244S ASW
duction of the Mk 46 have stumbled over what torpedoes
Beijing perceives to be the inordinately high cost of United Kingdom 2.6
the agreement ($500 million)
Future Systems
Beijing's naval modernization thus far consists mainly
of mating weapons or equipment onto existing naval
platforms. In our judgment, Beijing will use the
experience gained by this method in the design and
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construction of entirely new classe
s of warships, and
antiship missiles and its limited ASW advances repre-
plans for several
sent a dramatic improvement in Beijing's ability to
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new classes of ships are going forw
ard:
deter hostile naval action. ~~
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plans to build a new
Despite progress in building a more modern Navy,
however, serious deficiencies in ASW, air defense,
and early warning continue to keep the Chinese Navy
incapable of protecting commercial sea lanes or fight-
ing the Soviet Navy any farther than 900 km off the
Chinese coast:
4,200-metric-ton destroyer. Last July~igned
a contract with General Electric for five gas turbine
engines for the new destroyer.
? A New Submarine. The Chinese Navy has asked
the French for assistance in designing a new class of
diesel-powered attack submarine,
The
Chinese are negotiating with several West European
countries to purchase the advanced periscopes and
fire-control systems, torpedoes, batteries, and sonars
that could be used on a newly designed submarine.
According to press accounts, each
boat will be armed with a 76-mm main gun, four
surface-to-surface missile launchers, and aclose-in
weapon system. These boats will be quicker and
more powerfully armed than China's current fast
attack boats.
Can the New Strategy Work?
With the greater firepower and flexibility resulting
from force modernization, we believe the Chinese
Navy will be able to expand the scope of its naval
operations and continue to meet its coastal defense
mission. The aim of China's drive to modernize its
Navy after all is modest, and Beijing knows it cannot
compete with the Soviet or the US Navy for domi-
nance of the Pacific.
that they do not intend to become a "bl"ue water"
navy. Beijing's goal is instead to deter its adversaries
by raising the cost of a seaborne attack on China, and
the new strategy of active defense supports this aim
by giving China's seaward defenses greater depth to
inflict losses. In this regard, China's development of
? Although China's attempts to upgrade its subma-
rines and helicopters with ASW sensors and the
addition of helicopter-capable warships demonstrate
Beijing's intention to improve its ASW capabilities,
over the next 10 years the Navy probably will not be
able to acquire the quantity and quality of ASW
platforms to hunt Soviet submarines in deep waters
away from China's continental shelf.
? Even though China's efforts to procure rapid-fire
guns for its warships have provided some air defense
capability against antiship missiles, without aship-
borne SAM system China's major combatants re-
main vulnerable to aircraft with standoff missiles
and restricted in their combat operations to the 900-
km combat radius of most Chinese fighter aircraft.
? China's ability to monitor Soviet naval activity is
modest. Chinese aircraft have only limited experi-
ence in maritime reconnaissance,
Moreover, China does not permanently maintain
ships or submarines on station at the entrances to
the East and South China Seas, severely limiting
early warning of Soviet naval moves.
China, moreover, even with Western assistance proba-
bly will be unable to keep pace with the qualitative
and quantitative improvements likely to take place in
the Soviet Pacific Fleet over the next 10 years. These
probably include:
? The introduction of more advanced nuclear-powered
submarines to the Pacific Fleet, including the Alfa
SSN and Oscar SSGN.
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? The delivery of additional Kirov-class cruisers and
Sovremennyy- and Udaloy-class destroyers.
? The fielding of more long-range Backfire bombers
to the Far East, followed by the deployment of
Moscow's newest long-range bomber, the Blackjack.
China's severely limited defense budget will continue
to be the paramount constraint on the pace of weap-
ons acquisitions from the West and overall naval
modernization. With economic modernization con-
tinuing to take precedence, China's armed services
compete vigorously for shares of a relatively small
military procurement budget. Navy Commander Liu
apparently has fought successfully for some new
weapons production for the Navy, but the equally
pressing needs for modernization of ground and air
forces are likely to keep naval imports restricted to a
very few key areas for many years to come. Indige-
nous weapons research and development still marked-
ly lag more advanced nations like the Soviet Union,
and the Chinese leadership probably will be content if
it is able to simply maintain a credible seaward
deterrent for the next decade.
Implications for the United States
We believe Beijing views the United States as an
excellent source of military technology and as an
important counterweight to Soviet naval power in
East Asia. Although the Chinese Navy is eager to
build on the senior naval contacts that have developed
over the past two years, they are unlikely to lead to
any form of strategic cooperation or close military
coordination. For its part, Beijing believes that would
undercut its claim of pursuing an independent foreign
policy, further complicate its relations with Moscow,
and-in our judgment-be a source of friction in the
leadership. China's extreme sensitivities on this issue
were demonstrated last spring when a scheduled US
port call at Shanghai-the first since 1949-was
canceled at the last moment, in part because it
became entangled in other issues, including leadership
politics. More recently, Chinese and US warships
steamed together for the first time, but the Chinese
Foreign Ministry downplayed the significance of the
exercise and stressed that China is not allied with
either superpower. Moreover, China recognizes that
the United States intends to maintain a strong naval
presence in the Pacific-from which Beijing bene-
fits-regardless of China's actions.
Nonetheless, Beijing's inability to keep pace with the
growing sophistication of the Soviet Pacific Fleet will
make the role of the United States in China's naval
modernization increasingly important. In our judg-
ment, as the Chinese Navy slowly absorbs the first of
its Western technologies, the pressure on Beijing from
the Chinese Navy probably will increase for the
acquisition of even more sophisticated weapons and
equipment not only for the ASW mission area, but
also for more sensitive areas such as submarine
warfare.
If Washington fails to provide the level or type of
technology desired by Beijing, however, China most
certainly will try other channels. Moreover, Beijing is
most interested in acquiring production technology,
and arms deals that offer only finished weapon sys-
tems are less attractive. To get the transfer of the
most sophisticated technology for the lowest cost, we
believe, Beijing will seek to further exploit the rift
between the United States and other Western nations
on arms sales to China by luring the Governments of
Israel, Britain, France, and Italy to make concessions
on technology transfer. One tactic favored by the
Chinese is to stage a showdown among competing
Western weapon systems. In 1983, for instance, Beij-
ing held a "fly offl' among three Western defense
contractors for aheavy-lift helicopter that netted
Sikorsky a $150 million contract. A similar "fly offl'
was held last year for attack helicopters.
The US Posture in East Asia
Although Beijing's naval strategy and the weapons
desired from the West are primarily defensive,
China's naval modernization will improve Beijing's
capability to use its naval forces to project power
against militarily weaker nations. In East Asia, Tai-
wan and Vietnam will view these developments as
most threatening, but diplomatic and
modernization is a
major concern to Japan and other East Asian nations.
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Too Secret
In our judgment, the strengthening of China's naval
capabilities will improve Beijing's chances of success-
fully blockading Taiwan.s As a result, Taipei will seek
means-including heavier lobbying of the United
States for more advanced weapons and equipment,
such as FFG-7 frigates, Lamps ASW helicopters, and
PC-3 Orion aircraft-to restore the naval balance in
the Taiwan Strait
Hanoi likewise will seek to improve its naval forces, in
our opinion, by requesting more warships and training
from the Soviet Union, possibly allowing Moscow
greater access to Cam Ranh Bay in return. Japan and
other East Asian nations, on the other hand, are likely
to express their concern and seek assurances from
Washington on how far the United States will go on
military technology transfer to Beijing. Japan already
has expressed reservations in COCOM about the
transfer of certain types of naval equipment to Bei-
jing-including US torpedoes and British sea mines-
and more advanced sales are sure to elicit sharp
protests. Both Indonesia and Malaysia, while seeking
to improve their relations with Beijing, plan to up-
grade their air and naval forces with advanced fight-
ers and warships from the West, and are likely to seek
US assistance in doing so.
No Direct Threat to US Naval Power
Although naval modernization somewhat improves
China's capability to project power, Beijing lacks the
weapons, doctrine, and experience to seriously threat-
China built its last amphibious warfare
Vietnamese Navy despite two years of artillery and
infantry clashes along the Sino-Vietnamese border.
Beijing's reluctance to employ its Navy to harass and
intimidate the Vietnamese suggests that the Navy's
mission is, and will remain, largely defensive.
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ship in 1981, and there is no evidence Beijing plans to
resume construction. Moreover, China's naval train-
ing is strikingly defensive in orientation. China has
only one 5,000-man Marine brigade, and its mission
appears largely confined to defending the Paracel
Islands from Vietnamese assaults. Furthermore, Chi-
na has not used its Navy against the much weaker
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Top Secret
Top Secret
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