China will now allow more companies to cooperate in the development and production of military equipment, according to a report by China Daily.
"The government will open more fields in the defense sector to private enterprises and lower the entry threshold for them," director of the State Administration of Science, Technology and Industry for National Defense Xu Dazhe said.
The declaration comes as the country opened the first Military and Civilian Industries Integration Expo in Beijing on Thursday that will showcase military technologies and products during the 10-day event.
Furthermore, Xu said that the government will reduce restrictions on private businesses in the military equipment industry and urge state-owned defense contractors to make use of products made by private companies.
Ding Feng, an expert at the Civil-Military Integration Equipment Research Institute, explained that the new strategy will enable private companies to cater to the needs of the People's Liberation Army (PLA) and reduce development and procurement costs.
After obtaining four government-issued licenses that cover confidentiality and technological capability, businesses can bid for contracts from the PLA.
Since 2005, China has been gradually letting private enterprises get a share of the defense market.
President Xi Jinping has called on the government and the PLA for increased integration of defense and civilian industries.
The endeavor has been considered as one of three goals which the Party pledged to attain through reforms in the national defense system and the PLA.
According to Xu Zhanbin, deputy director of the administration, close to 1,000 companies in the private sector have been allowed to develop and produce weapons, which comprise 40 percent of defense equipment contractors in the country.
However, there are still factors that inhibit the full integration, such as poor access to large experimental instruments and testing facilities on the part of private companies.
Aside from inviting private companies to take part in the restructuring of state-owned defense enterprises, the administration is also prodding the latter to go public, said the deputy director.