China’s creation of a commission headed by President Xi Jinping to increase integration between the nation’s military and industry shows Beijing’s determination to shake up the country’s bureaucratic and antiquated weapons production system, analysts said.

Military observers believe the ultimate goal of the commission is aimed at cultivating defence manufacturers in China similar to Lockheed Martin and Boeing in the United States.

But they warned that interest groups that monopolise China’s defence industry and concerns over the protection of intellectual property rights will be two key obstacles hindering any reforms.

The state-news agency Xinhua reported on Sunday that Xi would head the newly established Central Commission for Integrated Military and Civilian Development.

… China’s state defence companies want to be more commercially minded, but rely heavily on government support, according to Richard Bitzinger, a military expert at the S. Rajaratnam School of International Studies in Singapore.