China has recently launched its sixth-generation stealth fighter, the Chengdu J-36. The sale of J-35 stealth fighter jets to its long-time strategic partner, Pakistan, signifies China’s growing ambitions to enhance its global weapons exports. This engagement between China and Pakistan comes in the wake of President Donald J. Trump’s re-election, and the possible targeting of China’s supply chains through the enforcement of strict tariffs. Beijing already maintains pre-eminence in the civilian nuclear supply chain, where it has become the fastest-expanding nuclear power generator with 39 operating and 19 under-construction nuclear power reactors. China is actively contributing towards resolving various global crises such as the energy crisis by introducing and financing innovative technologies into the global supply lines. This scenario prognosticates that China’s leadership in the nuclear energy industry is transcending into the domain of conventional supply lines.
The global supply chain refers to the distribution of production labour across different divisions and geographical locations. Transnational companies have dispersed modes of production connected through a contractual network among them. This approach enhances their efficiency and improves quality as multiple entities develop expertise in manufacturing specific components of a complete product. In this entire process, it is not just firms but also countries that specialise in manufacturing different products by ascertaining competitive advantage at the global level.
The ascendance of China in the nuclear supply chain of peaceful technologies is evident both domestically and internationally. The China National Energy Administration aims to increase nuclear capacity to 120-150 GW by 2030, up from 38 GW in 2017. Globally, China has become the second largest nuclear energy producer, surpassing France in 2020, and it aims to become the largest by 2030. In addition, Beijing aims to build 30 civilian reactors abroad, valued at $145.5 billion by 2030 with negotiations underway with countries such as Kazakhstan, Pakistan, Argentina, and Saudi Arabia.
The strategic focus on securing lead roles in global supply chains is likely to intensify, especially with Donald Trump’s return to the Oval Office, as his provocative rhetoric is expected to further strengthen China’s determination to lead a productive role in global affairs.
China’s progress in reactor development is notably rapid, with an average of seven years required to become functional. This success encompasses its leading role in knowledge gathering from a network of international collaborations, including partnerships with the French Alternative Energies and Atomic Energy Commission and Kyoto University. China is making significant contributions to the global market for peaceful nuclear technologies through these accomplishments in civilian nuclear export.
The dominant status of China in the nuclear industry is due to the advancements in cross-cutting technologies. It has also emerged as a global leader in nuclear fusion innovation for the generation of nuclear energy, especially with the development of the HL-3 tokamak, which is the most advanced fusion device to date. China’s patent applications for nuclear fusion have significantly increased from 1.3% to 13.4%. Additionally, it has pioneered the launching of the world’s first fourth-generation, indigenously made nuclear energy reactor: the Hualong One reactor. With a major leap in controlled fusion technology through robust investment, China has pledged $1 billion to 1.5 billion annually to address the global energy crisis.
Beijing has acquired a peaceful development in the global nuclear supply chain. Its domestic capacity enhancement, through its innovative and highly efficient peaceful nuclear technology, resulted in a positive impact on the global civil nuclear supply chain. Moreover, China intends to establish its dominance in additional supply chains, including conventional weapons and appears keen on ascertaining this through methodically conceived initiatives.
China’s state-owned defence corporations have developed significantly in recent years, augmenting its footprint in the global defence industry. State-owned firms like the Aviation Industry Corporation of China (AVIC) and China North Industries Group Corporation Limited (NORINCO) are among the leading Chinese vendors that have been instrumental in enhancing China’s footprint in the global supply chain of conventional weapons. These firms are increasingly taking over the market share, surpassing their American and European competitors. The extensive focus on emboldening its state-led defence enterprises reflects Beijing’s commitment to boosting its conventional weapons market share.
China’s extensive incorporation of advanced technologies, including Artificial Intelligence (AI), in its defence sector has been pivotal in asserting the credibility of Chinese technology and demand for Chinese weapon systems. The SIPRI 2024 report on Armaments, Disarmament and International Security places China as the fourth biggest arms exporter. Future arms orders promote China even ahead of Russia, as per the SIPRI 2023 report, as the demand for Chinese combat aircraft and tanks is increasing exponentially.
China’s strategic superiority over the United States (US) in the Rare Earth Elements (REEs) has similar underpinnings in the global supply chain of conventional armament. Being a key component for electronic chips required for missiles, Unidentified Air Vehicles (UAVs), aircraft and submarines, China’s dominance on rare earth metals demonstrates its capability to weaken the dominance of the US military-industrial complex. The deterrent potential of REEs against the Western armament industry is illustrated by China’s ban on the export of certain REEs to the US that were suspected to have potential military applications.
US preferential treatment of its allies and enforcement of sanctions on several states is a strong impetus to the growing Chinese share in the global supply chain of conventional weapons. As evidence, the aggrieved states including Pakistan, which have historically relied on the US armament, are now moving towards the Chinese camp. Similarly, US President Donald Trump has repeatedly indicated the enforcement of cumbersome tariffs against China, raising the threat perception for the Chinese global supply chain. This also acts as an impetus for China to look for multiple supply chain avenues and take concrete steps toward leading global supply chains.
With established leadership in the global nuclear supply chain innovation, China is poised to lead the innovations in the conventional supply chain next. By dedicating a major share of military spending, which reportedly amounted to $236 billion, it surpassed all the other Asian countries combined to bolster its state-of-the-art weapons technology. Consequently, China has taken concrete steps towards introducing AI in its military apparatus to ensure its rise in the domain of conventional weapons supply chain.
China’s recently launched sixth-generation stealth fighter Chengdu J-36 possesses the ability to fly supersonically without using afterburning. They are specialised as miniaturised command and control centres in the air that can guide the swarm of combat drones on a battlefield. It validates China’s upward trajectory in the conventional armaments domain and sets the stage for China’s greater market share acquisition. These substantial advancements in the domain of conventional weapons demonstrate the country’s capability to spearhead global supply chains. China is emerging as a major innovator in emerging technologies that aim to challenge US political and economic dominance. This is evident from its leading role in the Shanghai Cooperation Organisation (SCO) and BRICS, which stands for Brazil, Russia, India, China, and South Africa, and now five new members, as well as the Belt and Road Initiative (BRI) project. China’s leadership in global supply chains underscores its expanding presence on the international stage. The strategic focus on securing lead roles in global supply chains is likely to intensify, especially with Donald Trump’s return to the Oval Office, as his provocative rhetoric is expected to further strengthen China’s determination to lead a productive role in global affairs.
This article was published in another form at https://cscr.pk/explore/themes/defense-security/chinas-rising-influence-in-civil-nuclear-supply-chains-is-conventional-next/