General Ding Henggao serves as Chairman, Commission on Science, Technology and National Defense Industry (COSTIND). This article originally appeared in China Military Science (Summer 1994).

The development and reform of defense science, technology, and industry are now in a key stage. A new situation and some arduous tasks lie ahead of us. This is mainly reflected in the following:

• Owing to the needs of modern technology, especially in a high-tech regional war, we have to speed up research and development of new weapons and develop our national defense science and technology in order to reach the advanced world level.
• The second strategic goal of socialist modernization is for us to continue to carry out a policy of linking the army and civilians and to accelerate this step of strategic transition so as to release more power into the main battle field of national economic construction.
• The basic object and whole plan of national economic system reform call for further liberating and developing military productive forces to form a new system suited for socialist market economy that would combine with the practices and special features of the national defense industry. The necessary prerequisites to complete these tasks are to uphold a practical and realistic style of work, emancipate the mind, and under the guidance of Deng Xiaoping's thoughts on building a socialist society with Chinese characteristics, to research and approach the major problems, to enhance our sense of principle, orderliness, predictiveness and creativity.

Faced with new conditions and wanting to speed up the reform and development of defense science and technology, we must first of all fully understand its vital importance. President Jiang Zemin pays great attention to this. He asserts that the key to developing defense science and technology is to heighten its level. This is not only the requirement of the new military strategy but also that of the whole modernization drive. We can deepen our understanding of these points from the following three aspects:

• Defense science, technology, and industry are the major material bases on which we can realize our army modernization. The use of modern weapons is a sign of a modernized army, and is also one of the factors for improving the combat effectiveness of an army. The biggest problem we have in the construction of a modern army is the lack of up-to-date weapons. With the deployment of high technology in the military domain, the precision of weaponry has improved, the intensity of the battle has greatly increased, and other characteristics of war like swiftness, abruptness, three dimensions, mobility etc. have become more conspicuous. As the Gulf War clearly showed, the one who possesses high-tech superiority will have the upper hand on the battlefield. To fundamentally change the backwardness of our army's weapons, and strengthen the material base we count on to deal with local wars of modern technology, especially those under high-tech conditions, we must speed up the research of new and high-tech weapons , and raise the level of modernization of our weaponry. Weapons modernization is, in the final analysis, determined by the modernization of our defense science, technology, and industry. Therefore, we must seize the opportunity and speed up the development of our defense science, technology and industry, to ensure the realization of the modernization of defense.
• Defense science, technology, and industry are important symbols of our comprehensive national power. At a time of peace and development, world competition is essentially about comprehensive national power, and the key is the competition in science and technology. National defense science, technology, and industry represent a nation's economic and technological power and are important pillars of the comprehensive national power. They are also essential for the raising of the nation's status. China is a developing country with a low per capita income. One of the reasons that we are not looked down upon in the world is that we have built a relatively complete defense industry, and we have been able to research and manufacture various types of conventional and strategic nuclear weapons independently. Deng Xiaoping said, "If China did not have atom bombs and hydrogen bombs, and had not launched satellites since the '60s, China would not be called an important, influential country and would not enjoy the international status that it does today." Such things reflect the ability of a nation, and also symbolize the prosperity and development of a nation. In the last few years, we have achieved a series of breakthroughs in defense science, technology and industry. Both the new developments in the research of weaponry and the successful launching of satellites for foreign countries further promote the strengthening of comprehensive national power and raise our international status.
• Defense science and technology are the leading forces for the development of our national high-tech industries. Nowadays, more and more countries attach great importance to science and technology and are developing their high-tech industries as if they were in a race. It has become a strategic focal point and a common practice. Deng Xiaoping once said, "Whether it was in the past, at present, or in the future, China is determined to develop its own high technology and to occupy a position in the domain of high technology in the world." On the whole, defense science, technology, and industry belong to high-tech industry, and they can stimulate high-tech industry and cause great advances in it, especially in three aspects:

-To go through the processes of research, experimentation, and production in the defense industry, we need a lot of new materials, new technologies, experiments with new methods, and efficient facilities for production. This is bound to make strict demands on basic industry and result in a series of industrial breakthroughs and improvements.

-Then, some new high technologies, such as nuclear technology, telemetry and remote sensing technology, automatic control, electronics and computer science, precision machinery, meticulous chemical, etc. were originally and successfully used in the defense industry and have gradually formed some new competitive industries through their application in the civilian sector. -Finally, the military departments and enterprises make full use of their superiority in equipment, technology, and talented personnel directly to develop new high technology products, which, to a certain degree, have filled in the gaps in the fields of science and technology and raised the overall level of the national economy.

With changes in international affairs and hot competition in the high-tech world, all countries are readjusting their national strategy and defense strategy and pursuing the development of modern technology, especially high technology, as the key measures to strengthen comprehensive national power and defense strength, and thus gain the strategic initiative. Historical experience has proven that all starting points and guiding ideology in our work should alter with changing situations. Analyzing the distinguishing features of modern technology, especially high technology, and taking into consideration our national and military conditions, we need to seize the opportunity to speed up the development of defense science and technology. We also need to correctly understand and handle some important relationships:

• The relationship between the part and the whole. Defense science and technology are parts of a complicated system involving a wide range of areas. Some of them are urgent in the short view but not so from the longer view. Therefore, we must pay special attention to the overall balance, clearly defining our priorities and tilting toward the major projects. When we form development strategy or policy on technology, we should start from the overall development of defense science and weapons research and manufacturing. We should focus on raising overall efficiency and properly handling the relationship between the part and the whole. The relationship between requirements and possibility. For a considerably long time, the gap between available funds and the large investment needed for developing high-tech weapons will be a restriction on development. For this reason we must make great efforts to balance production with rational disposition of funds in all projects. Additionally, we should get rid of and guard against extravagance for instant benefit, repeatedly spending money for quick results followed by a quick reversal, and so on.
• The relationship between making the focal points stand out and coordinating the different branches of development. It would be best if we choose projects that will play both an important role in strengthening the fighting capacity and the deterrent power of our armed forces, and a vanguard role in raising the level of defense science or the level of the whole nation's science and technology. For the major projects, we should concentrate manpower, material resources, and financial resources to ensure their implementation. Meanwhile, we need to coordinate the overall development of all weapons with science and technology.
• The relationship between the requirements of demand and the push of technology. To program weapons development we have to adhere to the principle of linking demand requirements with the push of technology. On the one hand we should make thorough studies of the requirements of local war under the circumstances of modern technology, especially high-technology. On the other hand, we should lay stress on discoveries in the development of new and high technology, which will raise the effectiveness of weaponry. A new concept and a new system of weaponry should be formed and the structure of weaponry renewed and optimized constantly.
• The relationship between long-term and short-term interests. Proceeding from the requirements of high-tech war, we ought to manage to do research on some weapons with a higher starting point in accord with the plan and the focal point, and utilize results in scientific research to improve existing weaponry and military equipment. To obtain staying power, we should also do research in advance, reserve more technical capacities and keep up with the advanced world technology, so as to raise the overall level of defense science and technology.
• The relationship between the efficiency of the whole and the efficiency of a single unit. A local war under the circumstances of modern high technology is a confrontation between two systems within a given battleground. We need to study both operational policy and weapons development from the standpoint of systematic operations to raise the efficiency of the whole and hence the quality of our weapons system. If we do not examine the quality of our weapons system as a whole, even if we have numerical superiority or an advanced single weapon, we can not make the most of these weapons as a whole.
• The relationship between the offensive and defensive. In a future anti-aggression war, our country will uphold the concept of active defense. It means that active defense is not just defensive, it is offensive as well. Our air-defense weapons system and even the whole weapons system should have two capabilities. It could greatly help overall quality and effectiveness if we possess one or two effective weapons that can assume the offensive.
• The relationship between defense and commercial use. With the development of modern science and technology, defense and commercial products become more and more compatible. While we emphasize the conversion of defense technology into commercial use, we must study defense-commercial dual purpose technology and possible transfers from commercial technology to defense use. Development of defense products should actively use commercial technology, so that it will have a solid foundation for development.

A problem that restricts or affects the development of the defense industry is the improper defense industrial structure. For this reason, our fundamental goal for modernizing the structure is the optimum disposition and full liberation of the military productive force. As the international situation changes and new technology steadily develops, many developed and developing countries find a flexible military industrial structure to be an important strategic measure in restructuring their national defense industry. Currently, we have made good progress in defense industry adaptation, but the situation is still short of what is expected for example, problems such as activities too large in scale, overextended battle lines, low-level production, inefficiency and so on still exist. In the future, any defense industry should follow and serve the needs of the military strategy in the new era and be suited to the building of the country's socialist market economy system. Additionally, we should pay attention to the following points in our guiding ideology:

• Speed up modernization by relying on progress in science and technology. Science and technology are the number one factors in the productive force. With the rapid development in science and technology, economic competition in the world has more and more become the competition of a product's level of technology. Modern warfare is also, to a degree, the competition of high technologies. Adjustment in the structure of the defense industry and improvements in its of research and manufacturing capabilities should be conducive not only to the rapid development of national defense science and technology but also to research and manufacturing of high-tech weapons, and to the integration of research and production. We should pay attention to the development of mature technological products and useful foreign products to improve our existing equipment, and to raise its technological level. We should also be aware of the requirements of a high-tech local war and focus on the research and manufacturing of high-tech weaponry. To raise the level of technology, and to have rapid development, we should put advanced research in a strategic position and concentrate our resources on breakthroughs in key technologies. At the same time, we should pay close attention to the improvement and renewal of technology and the coordinated development of technology, equipment, and materials. Additionally, we should conduct our research and production of military supplies by relying on science and technology and by improving the quality of our workers.
• Adhere to the principle of contracting the front and stressing the main point. At the present time, the units that are responsible for research and manufacturing of military products do not have that many projects or funds. In addition, some shortcomings like scattered resources and repeated projects still exist, causing a longer period of research or manufacturing and a lower productive level. In future modernization, we should cut down those projects that are outdated and make allowances for those that are really advanced. We will mainly derive our plan from the tasks, and take the investment as the foundation, concentrating the research and production in some major enterprises and academies or scientific institutes. Moreover, we should concentrate them in a number of workshops or laboratories within an enterprise or an institute. As a number of scientific bases and major production bases are formed, we will concentrate resources and try to fulfill the task of manufacturing military products on time, guaranteeing quality and quantity.
• Apply economic methods to promote modernization. In the past, we adjusted the defense industry structure depending on the plan and administrative method. Under the overall situation of building a market economy system, we should apply more economic methods, particularly insisting upon the role of the market and giving full play to the function of our market system. For instance, the start or the abandonment of our scientific projects, or the increase or decrease of production power, should be decided according to the requirements of the domestic and international markets. The market will play a fundamental role under the macro adjustments and be controlled by the state.

The Fourteenth Party Congress made it clear that the goal of our economic system reforms is to build up and improve the socialist market economy system. The third plenary session of the Fourteenth Party Congress further confirmed the framework of our socialist market economy system and put forward requirements for the initial buildup of the socialist market economy system at the end of this century. How to speed up the reform of the military industry, and build a new system that meets the requirements of the market economy are important issues to study and answer.

The military industry is an component part of the whole economic system of the country. Its production, circulation, distribution, and exchange activities cannot be separated from the national economy. Therefore, it must be subordinated to the need to set up a new economic system in the country, and speed up the transition to the socialist market economy. The transition from a highly centralized, command and planned economic system to a market economic system is a great change of strategic significance for the military industry. The key to what is actually a profound revolution is the proper handling of the relationship between the plan and the market. Deng Xiaoping has emphasized on many occasions that both the plan and the market are tools of economics. President Jiang Zemin pointed out, "The scope, degree, and forms of integration of the planned and market economicscan be different at different times, in different areas and regions." According to the realities and characteristics of the military industry, we should pay attention to the following three points for the present time:

• National security is the foremost reason for the research and production of military products. Its funding mainly relies on investment by the state, and the state is the monopoly buyer of the products. There should be strict planning and management of the research and production of military products by the state. The state should purchase these products, and production should not be regulated by the market. Concerning the allocation of resources, the state plan should still play the leading role and be the main control point.
• Reform of the research and production of military products should be directed toward designing a contract system. Through economic contracts, there should be clear relations of interests between the supply and the demand sides, and there should be unity of responsibility, rights, and interests. The essence of a purchaser/contract system is to shift to the market economy, changing administrative management to management by economic means.
• As an economic activity, the research and production of military products should follow the law of value, and adapt to the changes in supply and demand, making full use of the role of the market. At the same time, control by the state should not be weakened or negated. During a shortage of resources, or an imperfect market, the strengthening of state control would be conducive to giving full play to the advantage of socialism in concentrating resources on big projects, and achieving better results and efficiency from limited resources.

Another outstanding problem is the introduction of competition into defense industry reform. Competition is necessary to encourage creativity and to raise efficiency. In the early 1980s Deng Xiaoping said that there can be competition in weapons production. Some weapons can be produced by more than one department, and the army can choose to buy the better products. But in recent years, because of the unsmooth structure, the unclear division of government and enterprise, interference by the administration, and the weak concept of market, the competition mechanism has not been given full play in the research and production of military products. According to the experiences of the developed countries, and in light of the actual conditions in our country, we should actively introduce competition in the research and production of military products. But the scope, items, and forms of competition should be chosen according to actual situations. For example, in terms of scope, competition can be carried out in the same trade, in the defense industry system or in the whole country in certain cases. In terms of weapons systems, there can be competition in subsystem or in single unit equipment. In terms of items, we can start out in small and medium projects, and when we have more experience, we can then gradually press forward. In terms of forms, we can have competition among units and even within the same unit.

The current world is an open world. We must notice that the general trend of development in the world economy and in science and technology is increased mutual infiltration, interdependence, and integration. Any country that wants to speed up development has to carry out an open policy. Deng Xiaoping said, "Opening to the outside world is of great significance. It is impossible for any country to have development in isolation and with its door closed, neither would it be possible without the strengthening of international exchanges, and importation of advanced experiences, science and technology, and funds from the developed countries." In fact, even in the confidential and sensitive military sphere, the countries of the world are not closed to each other. Many countries not only import advanced technology and equipment from abroad, but also carry out broad cooperation in the area of military high technology, and have joint research and production of new types of weapons. There is still a gap between the level of our national defense science, technology, and weaponry and that of developed countries. To make quick advances, we need to be self-reliant, but at the same time we should open wider to the outside world. There are two key points in the opening of national defense science, technology and industry:

• Increase exports. To satisfy domestic needs, the defense industry should try to develop products for export and expand exports. This will then open a source of income and accumulate funds to be used for imports. It will facilitate links with the international market, and through competing in the international market, the quality and character of our products will improve. Domestic and international needs can be considered as a whole, and scientific research and production will increase. It will also help to break the international monopoly and raise our international status. We must be aware that our products for export are not very competitive or cost effective. To achieve some breakthroughs in the international market, we need to dare to compete and carefully plan for long-term benefits. We should formulate a correct export strategy and adopt effective measures. For instance, we should try to open new markets, and concentrate on large and new projects. In response to market needs, we should promote the research and development of new types of products for export, raising the technological level of our export products so as to increase our competitiveness. Management of enterprises engaging in foreign trade should be further changed. We should increase the motivation for developing new products, improving quality, lowering cost, and increasing foreign exchange. We should constantly strengthen our competitiveness in the international market and open new venues for our foreign trade.
• Import technology. Deng Xiaoping pays special attention to the importation of technology. He has clearly pointed out, "Science and technology are the common treasures of mankind. Every nation, every country should learn from the strong points of other nations and countries, and learn from the advanced science and technology of others." In the process of our opening to the world, we should seize every favorable opportunity to import advanced technology from abroad, especially new and high technology. We should expand our technology cooperation and exchange with foreign countries. We should be good at linking imports with our own creations. Imported technology should be well digested and widely applied and used. The starting point of our research should be raised, and our ability to be self-reliant should be strengthened. While doing a good job in importing technology, we should create favorable conditions and adopt flexible measures to attract talented people from abroad. This will be beneficial to the acceleration of the development of national defense science and technology, as well as the training of talented people for national science and technology.

Scientists and technology experts are the creators of science and technology. Science and technology experts in the defense industry play a special role in the development of national defense science and technology and weaponry, and to a large degree determine the development progress of new high-technology weapons, and even the successful realization of the goals of modernization for national defense and army building. Under the overall situation of reform and opening up, and the development of a market economy, the conditions for the existence and development of national defense science and technology personnel have undergone great changes. We need to use new thinking to select and train talent. Deng Xiaoping once said, "We need to open up a way, so that talented people will grow to maturity quickly. We should not block talent. The constant emergence of talents means the success of our cause." Under the new situation, the building of the national defense corps of science and technology experts should pay special attention to the following three points:

• Liberate our minds and change our way of thinking. We should not simply rely on the state to supply us with experts. A new way is to attract and train science and technology experts through competition and promotion. The building of a high-level national defense corps of science and technology experts would not be possible without the support of the state and the improvement of the overall situation. But the national defense departments and units of science and technology should realize that reform and opening up have provided opportunities for them to attract more talent. They should focus on strengthening vitality and competitiveness and creating fine conditions to attract talent. They should be good at discovering, uniting, and making use of talent and maintaining a degree of superiority in the competition for talent.
• Change the environment for talent. What Deng Xiaoping once said is significant and worth pondering:
The most important point, which I am most concerned with in the reform of the economic system is talent. In the reform of the scientific and technological system, what I am most concerned with is also talent. . . . We should create an environment, in which talents showing themselves could appear. The reforms should create such an environment.

Under the traditional planned economy system and personnel system, national defense science and technology experts were normally assigned through state planning and administrative means. As the development of the market economy and the reform of personnel system moves forward, we should, under the guidance of the state, pay attention to exploring the opportunities for recruiting and selection through labor markets and facilitate the appropriate promotion of talent, to create a balance of supply and demand. We should also gradually set up a system of training, evaluation, examination, recruiting, promotion, and awards for talented people.

• Take a long-term point of view and train talent for the next century. In the competition for talent in the world today, competition for young and middle-aged talent is very intense. Many developed countries believe that the greatest challenge facing national defense science and technology is attracting and retaining needed talent, especially for key technologies. To strengthen the building of our national defense corps of science and technology, we should face up to modernization, the world, and the future, and focus on selecting and training a group of young and middle-aged leaders in science and technology who will advance to the forefront of global science and technology in the next century. Senior scientists and technological experts should make the historical responsibility of training young people their first priority. At the same time, concerned departments and units should not stick to a certain pattern but select talent, especially young talent, and boldly make use of them, letting them shoulder heavy responsibility in making technological breakthroughs, accumulate experience, and grow to maturity quickly.

National defense science, technology, and industry are very important strategically and have a unique pattern of development. Only by strengthening overall control can we take into consideration national and military strategic requirements and make timely decisions and arrangements in light of national economic, scientific, and technological realities based on collective wisdom and scientific proof. According to historical experiences and future trends of development, we should pay attention to the following if we want to raise the authoritativeness and effectiveness of the overall control system:

• Strengthen the centralized and unified leadership of the Party and the state. During the 1950s and 1960s, we lacked economic power and qualified technical personnel, and we faced a very serious international situation. We made atom bombs, hydrogen bombs, and satellites, and we made major breakthroughs in other fields of high technology. The most important reasons for these successes were the wise decisions of Chairman Mao and the Party Central Committee, and the high prestige enjoyed by the central government headed by Premier Zhou Enlai. Judging from the experiences of foreign countries, the development of high technology, especially military high technology, is strictly regulated and controlled by the state. Under our current system, the strengthening of centralized and unified leadership is mainly the strengthening of decisionmaking, at high levels on the development of the defense industry, major projects, and important issues like the integration of defense and commercial industries. Under centralized and unified leadership, the different levels of administration should be responsible for their own management work.
• Decisionmaking on the major issues should be scientific and democratic. One important lesson we learned from both positive and negative experiences in the past is to ensure correctness in decisionmaking and efficiency and effectiveness in execution. The key to both of these is that decisionmaking should be scientific and democratic. Along with the steady development of new-tech revolution, modern weaponry is increasingly associated with high technology, and its cost has more than doubled. In addition to the changeable and unstable international situation, various intricate problems place higher demands on decisionmaking. Those important decisions related to development strategy, planning, goals, and focal points of the defense industry and weapons development are related to complicated systems engineering, and they should be suited to the changes in the international situation and rely on possible national power. The modernization of our army places demands on national defense research and production and science and technology; it is especially high technology that provides a great push in the development of weapons and equipment. These two points should be emphasized. Only through an all-around assessment and a comprehensive balance of strategy, tactics, economics, and technologies can we ensure that any decisionmaking is correct and its execution effective. To make fewer false starts and avoid mistakes, we should adhere to a strict decisionmaking process while making decisions. The decisionmaking system should be improved, and we should give full play to the consulting departments' role in the making of decisions, especially paying attention to the advice by experts. We should also pool the wisdom of the masses, and the basis for the decisionmaking should be scientific and democratic.
• State planning should be based on scientific methods and earnestly carried out. The state command plan for the research and production of military products has the effect of law and should not be changed by any one or any unit without authorization. Of course, under the overall situation of a market economy, the command plan should also strictly follow the law of value, reflect the changes in supply and demand and give play to the economic lever. On the premise that energy supply, main materials supply, and transportation are provided by the state, all departments and enterprises should give priority to fulfilling the research and production tasks for military products, and strictly carry out contracts according to the law. Those who have violated the state plan or can not fulfill the plan, should be seriously dealt with.
Set up a fairly complete law system. We could say that a market economy is a legal economy. In order to carry on the research and the production of military products in a systematic fashion and achieve standardization, regularization, and legalization, we should continue improving the existing laws and regulations, emphasizing development of the basic law of research and production in the defense industry. Moreover, we need to make and issue new administrative decrees in accordance with the new problems or new situations we might be facing in research and production. We should have strict management procedures, work according to objective laws, and ensure the sustained, rapid, and healthy development of the national defense industry.

SOURCE: Chinese Views of Future Warfare
edited by Michael Pillsbury
Institute for National Strategic Studies