The assistance will be mainly in the form of subsidized loans, with direct funding as an alternative option, said the notice, posted on the website of the Commission of Science, Technology and Industry for National Defense.

The decision was made in order to "guarantee the smooth progress of research and development in military equipment," said the notice, which was posted in recent days.

All profits made as a result of government funding will have to be returned to the government, according to the notice.

No figures were given as to the amount of assistance that could be given.

The initiative could be of significance, as many non-state makers of military equipment are struggling financially, even if they are the source of the bulk of innovations in the field.

China is devoting increasing amounts of money to military purposes, with its defense budget rising by nearly 15 percent this year.

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