Sharpening skills: Chinese air fighters trained in Shandong Province in September. China's growing military prowess is changing the calculus in the Pacific.

BEIJING - Shi Jin wears a jean jacket, has razor-cropped hair, and seems gravely earnest. An officer in the People's Liberation Army, he was wooed from a Beijing vocational college three years ago by recruiters who talked up his technical aptitude - and his patriotism.

In the past decade, China has undergone two military high-tech reforms designed to give the country a modern fighting force. To sustain that progress, it must attract many more gung-ho young engineers like Shi, who spends most of his time working on an "informational" revolution that planners hope will one day allow them to "see" a battlefield with the same depth as the US military. "I will not do any direct fighting if there is a war, but I am contributing on the technical side," he says. "We are all needed in the new Army."

China's desire, often stated, is to be a great nation. Many in Beijing feel that the country's natural right is to be the major power in Asia. But China has rarely been given high marks in global military annals. It has a "brown water" Navy that doesn't navigate open seas. It can't project power by sending forces abroad. It has relied on states like Russia for jet fighters, cruise missiles, and other advanced weapons.

Yet it now appears China is methodically changing this equation.

In a surprisingly short time, China has accomplished two feats. One, it has focused its energy and wealth on creating an army within an army. It has devoted huge amounts of capital to create a small high-tech army within its old 2.2 million-member rifle and shoe-leather force.

The specialty of this modern force, about 15 percent of the PLA, is to conduct lightning attacks on smaller foes, using an all-out missile attack designed to paralyze, and a modern sea and air attack coordinated by high-tech communications. In other words, this new modern force is designed to attack Taiwan.

Second, China has taken painful but successful steps to create a "defense industrial base," or weapons-building capability. The PLA has improved its factory quality control and its ability to adapt foreign technology. It is bringing an indigenous small-wing F-10 fighter off the production line, and it is moving rapidly toward a "blue water" Navy with ships built in China.

Indeed, the past three years have yielded the impressive fruits of a modernization campaign started in the late 1990s: A nuclear attack submarine, the 093, launches in months; presumably it will be capable one day of firing satellite-guided cruise missiles that can blast a cruiser or carrier. China now has more accurate ICBMS, a host of land- and sea-based cruise missiles, and about 400 Su-27 and Su-30 Russian fighter jets it didn't have before.

"Do the old shibboleths still apply - that the Chinese defense industry is backward, poor, and low-quality?" asks Evan Medeiros, an analyst with the RAND Corp. in Washington, D.C.

"No," he says. "It seems China has turned the corner.... For the first time in 20 years, the PLA has adopted reforms that make sense. They adopted, and implemented, and are really learning quickly." Medeiros is lead author of a 300-page RAND study, "New Directions for China's Defense Industry," released this month.

"The PLA has undergone a revolution in communications," says James Mulvenon, of the Center for Intelligence Research and Analysis in Washington, D.C. "They have gone from dirt to wireless in a generation."

Taking China's power seriously

Such progress is catching attention, respect, and concern in the Pentagon. At Honolulu's US Pacific Command, and in military circles in Taiwan, Guam, and Tokyo, it is universally accepted that China is on its way to becoming a military challenge in Asia. US planners no longer talk dismissively of China's power or, potentially, its reach. In a key shift, US ability to quickly and easily defend Taiwan in an attack is no longer a given. Chinese cruise missiles are creating a more lethal environment in the Taiwan Straits.

This summer, Gen. Zhu Chenghu, dean of China's National Defense University, raised the subject of weapons of mass destruction, which China rarely mentions, in connection with Taiwan. Should US forces aid Taiwan in a war, he told bewildered US visitors, "Americans will have to be prepared that hundreds ... of cities will be destroyed by Chinese" nuclear weapons.

Coming to Taiwan's rescue "used to be a political decision," says Denny Roy, an expert on cross-straits relations at the Asia-Pacific Center for Security Studies (APCSS) in Honolulu. "Now it is a political and a military decision."

Yet while China may have turned a corner, tomorrow's Monitor story looks at how China's military prowess runs far short of the doomsday trend lines. China's military has not "leapfrogged" into modern warfighting in the way many alarmists in the US often loudly suggest.

Perceptions about a "China threat" have taken several sharp turns in the past 24 months. One came in 2004, as it appeared Beijing was making progress on not one but three submarine programs, including the 093. A Sovremenny class destroyer, one of four new Chinese-made destroyers appeared out of the blue. China was laying fiber-optic cable around the country; it was developing a capability at the heart of high-tech warfare called C4ISR (the interlocking sets of missile targeting and tracking known as command, control, communications, computers, intelligence surveillance and reconnaissance).

Then last winter, as Europe prepared to lift an arms embargo on China, the Pentagon took more than passing note. Seminars, papers, blogs, and defense reporting registered stepped-up amazement at China's progress: Chinese cruise missiles made US carriers more vulnerable. The word spread that selling NATO-compatible European weapons would give Chinese engineers a way to inductively figure out how US equipment ticks.

But months later, a strong "get real" school emerged, arguing that the threat was being hyped. A great gap exists between obtaining hardware and being an effective modern army, it was posited.

A major moment came this July in a Defense Department review on the PLA. While criticized as soft by hawks, the report hit especially hard due to a comment that China's buildup now appears to go past just an effort to invade Taiwan. Rather, it stated that China was modernizing its forces with the intent of longer range operations and "regional contingencies."

Some Pentagon sources told the Monitor that the Defense Department report was toned down, basically "because you have to try and work with the Chinese."

"They are buying and developing capability whose only use is against the US military," said an Asia-based US Air Force colonel. "The programs we can see are designed to combat a carrier battle group. Who is it that has carrier battle groups?"

In August, days after a Sino-Russian military exercise, China ordered a complement of Russian bomber refueling planes whose main use is to project power.

The US response to China has shifted as well in the past half year. This spring, Defense Secretary Donald Rumsfeld said in Singapore that China's military rise was illegitimate because China faced no threats. This point was seen as tactically clumsy even in Pentagon circles. "We [the US] spend $400 billion on defense. We don't have the right to decide other nations' threats," commented a career defense official in Washington.

By last month, during Mr. Rumsfeld's visit to Beijing, the defense chief had changed his public tune: China has the right to develop whatever military it wants, he said. But if China intends a long march to match US capability, more transparency is needed to avoid dangerous misunderstandings.

"One place where more information would be helpful to us and other countries is China's military developments," Rumsfeld told his counterpart, Gen. Cao Gangchuan. "China is expanding its ballistic-missile forces and those forces can reach many areas of the world, well beyond the Pacific. Those advances ... give cause for concern, particularly when there is an imperfect understanding about such developments...."

What's China's military budget?

In particular, the Pentagon is concerned about how much China spends, and what it is buying. China's exact military spending is shrouded. US experts say it spends $50 to $90 billion annually. Yet Defense Minister Gangchuan insisted to Rumsfeld that the figure is about $27 billion. Days later, the London-based International Institute for Strategic Studies noted that China's purchase of Russian equipment alone nearly matched the Chinese official estimate; the IISS says China is at $62.5 billion.

Experts like Medeiros argue that China's spending has in part given Chinese engineers the capacity to better adapt foreign technology, and to create its own hybrid technology. China's Shenzhou space capsule (recently returned from manned orbit), China's new destroyers, and its fighter jets - are all former Russian platforms. China's new F-10 jet is an example of an indigenous fighter that performs well.

"The F-10 is full of foreign equipment and technologies," Medeiros says. "It has Israeli avionics, Russian engines, European landing gear. China is gradually reducing its reliance on components and subcomponents from other countries. It can increasingly build such goods its own."

For years, Chinese industry seemed unable to build a decent propulsion system. But Medeiros shows they may soon have a turbo-fan engine for ships and planes. "They never did propulsion well, but they are finally producing such engines," he says.

PLA dollars have also stimulated a "blue water" Navy program that hit its stride last year, according to Taipei defense expert Andrew Yang. "We are seeing them simultaneously build different types of ships. They use a modular frame and load it with [their own] systems," he says.

Frigates, destroyers, and amphibious landing ships are all being built and designed with a new confidence, Mr. Yang says. Navy yards may employ a Russian hull design, but the ships' guts are designed to new Chinese specs.

"The destroyers and frigates, are getting bigger and bigger," Yang adds. "Six to seven tons. That is what you build for a long distance Navy...."

"There's been a sea change in the Pentagon's [view], a lot more respect for what Chinese industry can do," says Bates Gill, at the Center for Strategic and International Studies in Washington, D.C.

Taiwan especially is a place where China has succeeded in getting US attention. Despite Taiwan's 60 years of separate development, China views the island as its own territory. A conflict with Taiwan would be especially dangerous since, for internal political reasons, China can't start a war over Taiwan that it cannot win. A military loss over Taiwan could cause a collapse of the party in Beijing.

In order to win, China has designed a missile strike on Taiwan and a cruise missile attack on US ships that would be so colossal that US leaders will delay a decision to rescue, giving China time to take hold. China's nuclear threat this summer was a message to US forces that should a fight commence over Taiwan, the Pentagon may no longer be able to assume a conventional war over the island.

"They may be taking away US assumptions of a war that would escalate in stages," says Mr. Roy of APCSS in Honolulu.

In a conventional war, says Col. Michael Boera, a wing commander in Guam, his nightmare would be so many missiles or planes that even if his pilots could shoot them down, "they would keep coming.... I fear them numbers-wise. Where I am fighting too many planes, that's my concern."

"The PLA is getting in a position to considerably constrain our freedom of maneuver," says Roy. "We can't expect that we can completely protect a carrier battle group when it got into theater."

Pentagon officers are fond of saying that China is at a military crossroads. It must decide its size, capability, and whether it will begin to share its secrets with the US.

But the US is also at a crossroads in terms of its response and its relations with Asia. So far, the US has said it wants to work with China, keeping at bay those hawks who feel that China is a certain enemy.

Historically, in fact, China is not an aggressor. It rarely attacks. But then, what is called "China" has moved only in the late 20th century from a sprawling "civilization" to a nation in the modern sense. Moreover, the sense of national pride in China is powerful. As one rather liberal intellectual told the Monitor, "In our hearts, most of us want China to be great - we feel deeply a desire to help run Asia and the world."

What concerns some American China experts is that creating a modern army will also create the dynamic to use a modern army. Analysts like Mulvenon point to possible unintended consequences of a buildup.

"What I worry about is the military influencing foreign policy," he says, "[decisionmakers] using the military they have paid so much for like a tool in their kit ... as leverage in certain situations.... That can be how bad things get started."

First of two parts.