NIAS CEAP Reader

Photo : First Post

China Reader Daily Wire | 01 September 2026, Tuesday | Vol 3 No. 129

Xi reaffirms strategic ties with Russia

China and Bangladesh to begin two-plus-two dialogue

In Brief
INTERNAL
China's factory activity edges up but stays in contraction for second month
On 31 August, Reuters reported that China's factory activity improved in August but remained in contraction for a second straight month, an official survey showed, in a further sign that economic growth has lost momentum amid weak domestic demand. The official manufacturing purchasing managers' index (PMI) rose to 49.8 from 49.2 in July, beating the median forecast of 49.6 in a Reuters poll, but staying below the 50-mark separating growth from contraction. New orders and production sub-indexes returned to expansion above 50, with 16 of 21 surveyed industries showing month-on-month gains. The non-manufacturing PMI, covering services and construction, held at 49.0, its weakest level since December 2022. Economist Xu Tianchen said domestic demand appeared to be recovering, though "more likely... driven by AI and exports than by policy expansion." Pinpoint Asset Management's Zhiwei Zhang said it was too early to call it a rebound.
("Chinese factory slump eases, but weak services signal uneven recovery," Reuters, 31 August 2026)
https://www.reuters.com/world/asia-pacific/chinas-factory-activity-improves-stays-contraction-august-2026-08-31/

ENERGY AND ENVIRONMENT
Solar surpasses coal as China's top source of installed power capacity for the first time
On 01 September, Straits Times reported that solar panels have become China's top source of power capacity, surpassing coal in a key milestone for the country's green-energy transition. Solar capacity reached 1,286 gigawatts (GW) at the end of July, accounting for 31.5 per cent of total installed generation capacity, state broadcaster CCTV reported, citing the National Energy Administration (NEA). Coal capacity stood at 1,285 GW by comparison. Solar generation rose 15.5 per cent year-on-year to 802.4 billion kilowatt-hours in the first seven months of 2026, about one-eighth of the country's total electricity output. Newly installed photovoltaic capacity in July alone totalled 13.73 million kilowatts, up 43 per cent year-on-year. China remains the dominant player in the global solar supply chain, with sector investment expected to exceed CNY 2 trillion over the next five years. Despite the milestone, coal-fired plants still generate significantly more electricity than solar, since coal plants run much closer to their maximum output capacity.
("Solar surpasses coal as China's top source of power capacity," Straits Times, 01 September 2026)
https://www.straitstimes.com/business/solar-surpasses-coal-as-chinas-top-source-of-power-capacity

CHINA AND SPACE
China launches world's first operational space-based computing cloud
On 31 August, Global Times reported that China has put into operation the world's first orbital computing cloud capable of providing regular in-orbit experimental services, marking a new stage in commercialising space-based computing infrastructure. Led by Beijing University of Posts and Telecommunications (BUPT), the platform allows users to submit tasks, deploy software, and receive results through an automated, end-to-end workflow, reducing manual operations and enabling repeatable trials. Since entering service, it has supported big-data computing, 6G communication trials, and distributed storage experiments, completing hundreds of orbital computing calls for over 100 users. The system delivers large-model inference at an energy efficiency of ten tokens per joule using domestically developed hardware, with orbital service coverage exceeding 10 per cent. BUPT said the project's long-term value lies in shifting the space industry from "delivering hardware" to "continuously delivering services," potentially opening new commercial opportunities for satellite and telecom operators.
("The world's first space-based computing cloud kicks off in-orbit operation: media report," Global Times, 31 August 2026)
https://www.globaltimes.cn/page/202608/1369442.shtml

CHINA AND TAIWAN
Editorial: “Taiwan isn't saying much about its war plans for a China fight — but its military drills are” Business Insider, 31 August 2026
“Heavily outmanned and outgunned by China, Taiwan has been pivoting toward what it calls the "porcupine strategy." Instead of seeking to match China force-for-force, the island plans to rely on asymmetric warfare to make itself prohibitively costly for Beijing to capture. "From a capability standpoint, having small units operate in a more decentralized and independent way is exactly the kind of thing Taiwan's military has been emphasizing in its asymmetric force development in recent years," said Tristan Tang, a Taiwan-based nonresident fellow with the National Bureau of Asian Research, a US think tank. Taiwan has talked openly about building a "drone hellscape," a term coined by US Pacific Command chief Adm. Sam Paparo, on the strait, flooding it with hostile uncrewed aerial and seaborne systems to make a crossing extremely costly for Chinese forces. As the Han Kuang progressed, the drills moved farther inland, including a counter-sabotage operation at an oil refinery in Taoyuan, a city just west of Taipei. There, chemical troops called in by refinery staff set up a decontamination station for injured workers affected by simulated toxic gases released by enemy infiltration teams. "Dealing with that kind of threat would also require Taiwan to send out small units, probably squad- or platoon-sized task forces rather than company-sized formations," Tang said.
https://www.businessinsider.com/how-taiwans-drills-reveal-unspoken-blueprint-for-chinese-invasion-2026-9

China warns of “consequences” over Taiwan’s attendance at Pacific Islands Forum leaders summit
On 01 September, ABC News reported that China’s special envoy to the Pacific warned of “consequences” for Taiwan’s presence at the Pacific Islands Forum’s leaders summit in Palau after Taiwan’s Foreign Minister Lin Chia-lung joined its opening proceedings. Palau is one of the few countries in the world that maintain official diplomatic ties with Taiwan, alongside two other Pacific Island countries, the Marshall Islands and Tuvalu. Minister Chia-lung is set to meet with the leaders of these three allies tomorrow, but is also said to have held informal “catch-ups” with other dignitaries including the US representative Christopher Landau. China’s Pacific Envoy Qian Bo stated that Taiwan is not a dialogue partner with the forum and that they’ve made their “position” to the government of Palau, and insisted that the “consequences” remark wasn’t intended as a threat. Palau President and incoming chair of the Forum, Surangel Whipps, stated that China tried to coerce Palau over their Taiwan links, and that “he would not be bullied.”
(“China warns of 'consequences' over Taiwan's presence at Pacific Islands Forum leaders meeting,” ABC News, 01 September 2026)
https://www.abc.net.au/news/2026-09-01/china-warns-of-consequences-over-taiwan-attendance/107100296

Taiwan claims China has strengthened air and sea control around its territories
On 31 August, Reuters reported that Taiwan’s annual defence report on China’s threats to the country stated that Beijing has become “unpredictable” and that they’ve tightened air and sea controls near Taiwan island. China regularly conducts military drills and naval patrols around Taiwan Island as part of its “grey zone” activities, intending to put psychological pressure on its inhabitants. In its annual report released by the Defence Ministry, it stated that the regional security situation “continues to escalate” and noted the “rising unpredictability” in China’s actions due to its recent purges of senior military officers. The report added that China still lacks the capability to launch an amphibious invasion, but noted that they are attempting to “strengthen” its control over the sea and airspace around the Taiwan Strait, which is to “achieve the destruction of command-and-control and our air defence capacity in the early stage of combat.”
(“Taiwan says 'unpredictable' China strengthens air and sea control nearby,” Reuters, 31 August 2026)
https://www.reuters.com/business/aerospace-defense/taiwan-says-unpredictable-china-strengthens-air-sea-control-nearby-2026-08-31/

CHINA AND THE PACIFIC
Washington to fund gallium plant in Australia in an effort to reduce reliance on China
On 31 August, Bloomberg News reported that the US Department of War would fund USD 174 million to Alcoa Corporation to build a gallium plant in Western Australia as part of its efforts to reduce reliance on China. Gallium is used in high-performance semiconductors used in cutting-edge military technologies such as advanced radar and missile guidance systems. China currently accounts for 98 per cent of the world’s Gallium production and introduced an export control regime that banned all Gallium shipments to the US. Alcoa Corp. agreed to jointly develop the plant with Japan’s Sojitz Corporation and the Japan Organisation for Metals and Energy Security. Assistant US Secretary of War Michael Cadenazzi stated that “This landmark agreement with our key allies, Australia and Japan, will secure a vital supply of gallium for our defence industrial base, strengthening our collective security and economic resilience for years to come.”
(“US funds Alcoa gallium plant in Australia to cut China reliance,” Bloomberg News, 31 August 2026)
https://www.bloomberg.com/news/articles/2026-08-31/us-funds-alcoa-gallium-plant-in-australia-to-cut-china-reliance

CHINA AND SOUTHEAST ASIA
Vietnam demands to halt Chinese construction on the disputed Paracel Islands
On 31 August, The Diplomat reported that Vietnam expressed opposition to what it called “illegal” reclamation and construction activities in the Paracel Islands, following reports of fresh Chinese infrastructure work at Antelope Reef and nearby Yagong Reef. The Asia Maritime Transparency Initiative (AMTI) reported on 14 August that China had completed land reclamation at Antelope Reef and appeared to be building new infrastructure, including a likely airstrip, while Reuters later reported new installations resembling radar or early warning facilities on Yagong Reef. Vietnam, which claims sovereignty over the islands as “Hoang Sa” but has not controlled them since China seized them in 1974, said it held “full historical evidence and legal grounds” for its claim and had lodged a formal protest demanding an immediate halt to the activities. Analysts noted the Vietnamese response was unlikely to foreshadow significant tensions, given China’s comparatively restrained stance toward Vietnamese island-building in the Spratlys, where Hanoi has reclaimed nearly 2,800 acres of land in recent years.
(“Vietnam Demands ‘Immediate Cessation’ to Construction Activities in Paracel Islands,” The Diplomat, 31 August 2026)
https://thediplomat.com/2026/08/vietnam-demands-immediate-cessation-to-construction-activities-in-paracel-islands/

CHINA AND SOUTH ASIA
China and Bangladesh to begin two-plus-two dialogue
On 30 August, The Hindu reported that China and Bangladesh will begin a two-plus-two dialogue mechanism covering diplomatic and defence issues in the “very near future”. Bangladesh’s Minister of State for Foreign Affairs Humaiun Kobir said the framework is currently being prepared, with no specific dates yet fixed. The dialogue is expected to begin at the Minister of State level before eventually moving to the Foreign Minister level. The announcement followed Kobir’s meeting with Chinese Ambassador Yao Wen, during which they discussed several projects associated with Prime Minister Tarique Rahman’s recent China visit. These included the Teesta River Comprehensive Management and Restoration Project, the proposed China-Myanmar-Bangladesh economic corridor, the China Economic and Industrial Zone, and modernisation of Mongla Port. Kobir also reaffirmed Bangladesh’s commitment to the One-China policy. The proposed mechanism marks an institutional expansion of China-Bangladesh engagement into a more structured diplomatic and defence dialogue.
(“China, Bangladesh to start two-plus-two dialogue in the ‘very near future’, says Humaiun Kobir,” The Hindu, 30 August 2026)
https://www.thehindu.com/news/international/china-bangladesh-to-start-two-plus-two-dialogue-in-the-very-near-future-says-humaiun-kobir/article71407979.ece

China closes Tatopani border crossing amid landslide risks
On 31 August, The Kathmandu Post reported that China has suspended imports and exports through the Tatopani border point until further notice, citing the risk of landslides on the Nepali side near Liping. The crossing had only recently resumed limited operations after being closed for nearly three weeks in August because repeated landslides blocked the Araniko Highway. The latest closure comes after devastating floods destroyed the Rasuwagadhi border crossing and severely disrupted another major route between Nepal and China. With both Tatopani and Rasuwagadhi unavailable for normal trade, Korala in Mustang has become Nepal’s only functioning overland trade route with China. Officials are considering diverting stranded trucks and containers through Korala. The disruption is particularly significant ahead of Nepal’s festive shopping season, with traders warning of potential shortages and higher transportation costs. The closure also threatens customs revenue and further complicates Nepal-China trade following extensive flood damage along the northern border.
(“China closes Tatopani border point citing landslides risk,” The Kathmandu Post, 31 August 2026)
https://kathmandupost.com/national/2026/08/31/china-closes-tatopani-border-point-citing-landslides-risk

China sends 50 tonnes of emergency relief supplies to flood-hit Nepal
On 30 August, Kathmandu Post reported that China sent 50 tonnes of emergency relief supplies to Nepal following devastating floods and landslides along the Bhotekoshi and Trishuli river systems. Two Y-20 transport aircraft of the Chinese People’s Liberation Army Air Force arrived in Kathmandu carrying 13,200 relief items, including tents, blankets, sleeping bags, dry food and first-aid kits. Four Chinese tunnel-rescue specialists also arrived with specialised equipment to support rescue operations at hydropower facilities affected by the disaster. The assistance was handed over at Tribhuvan International Airport in the presence of Chinese Ambassador Zhang Maoming and Nepalese officials. The Chinese Embassy said additional tunnel experts would be deployed at Nepal’s request. Separately, China provided emergency cash assistance, including USD two million from the Chinese government and USD 200,000 from the Red Cross Society of China, according to the embassy’s spokesperson. The response marks a significant humanitarian component of China-Nepal relations amid one of Nepal’s most severe recent flood disasters.
(“China sends 50 tonnes of emergency relief supplies to flood-hit Nepal,” The Kathmandu Post, 30 August 2026)
https://kathmandupost.com/national/2026/08/30/china-sends-50-tonnes-of-emergency-relief-supplies-to-flood-hit-nepal

Xi, Modi and Putin attend SCO summit amid focus on multipolarity, trade and regional security
On 31 August, Al Jazeera reported that Chinese President Xi Jinping, Indian Prime Minister Narendra Modi and Russian President Vladimir Putin are attending the Shanghai Cooperation Organisation (SCO) summit in Bishkek, Kyrgyzstan. The two-day summit marks the organisation’s 25th anniversary and is taking place amid the aftermath of the US-Israel war on Iran and the continuing Russia-Ukraine conflict. The agenda includes regional security, Afghanistan, India-China relations, India-Pakistan tensions, economic integration and new transport corridors. The SCO is also expected to discuss the Development Bank, Development Fund and Investment Fund, while disruptions to maritime routes have increased interest in alternative Eurasian connectivity projects such as the International North-South Transport Corridor. For China, the summit provides an opportunity to strengthen its role in Eurasian security, connectivity and trade while promoting a more multipolar international order. However, differences among SCO members mean the grouping remains more a platform for strategic coordination than a unified political bloc.
(“Xi, Modi and Putin attend SCO summit: What’s on the agenda?” Al Jazeera, 31 August 2026)
https://www.aljazeera.com/news/2026/8/31/xi-modi-and-putin-set-to-meet-for-sco-summit-whats-on-the-agenda

CHINA AND THE MIDDLE EAST
China holds up Egypt ties as a model for its cooperation with Arab states and Africa
On 1 September, Xinhua reported that China’s President Xi Jinping said China-Egypt relations had become a benchmark for collective cooperation between China and Arab states and between China and Africa, describing the ties as a model of amity, solidarity and cooperation among developing countries. In a signed article published in Egyptian media ahead of his state visit, Xi said the two countries had always been close brothers who stood together through difficulty, reliable partners committed to win-win cooperation, and sincere friends built on equality and mutual trust, calling the relationship a successful model of mutual learning among civilisations.
(“Xi says China-Egypt ties a benchmark for China-Arab, China-Africa cooperation,” Xinhua, 1 September 2026)
https://english.news.cn/20260901/d2b9c58efba4427b99a2d72e7f9dc6fd/c.html

CHINA AND RUSSIA
Xi reaffirms strategic ties with Russia amid ‘unpredictable’ global order
On 31 August, Al Jazeera reported that China’s President Xi Jinping and Russia’s President Vladimir Putin reaffirmed their strategic alliance during their first meeting since May, held on the sidelines of the Shanghai Cooperation Organisation (SCO) summit in Bishkek, Kyrgyzstan. Xi said bilateral ties had grown “more solid” and that prospects for the relationship remained “even brighter” despite rising global uncertainty, while Putin said cooperation was “successfully developing on all fronts.” The two-day summit, marking the SCO’s 25th anniversary, drew over a dozen leaders, including Iran’s President Masoud Pezeshkian, India’s Prime Minister Narendra Modi, and Pakistan’s Prime Minister Shehbaz Sharif. Putin also met separately with Modi, who said New Delhi was ready to help end the war in Ukraine, while Pezeshkian told Modi that continuing the Iran-US war was not in Tehran’s interest. A Kremlin spokesperson said Putin and Xi discussed the Ukraine war only “in passing,” focusing largely on economic ties.
(“Putin, Xi reaffirm Russia-China ties amid ‘unpredictable’ world,” Al Jazeera, 31 August 2026)
https://www.aljazeera.com/news/2026/8/31/putin-and-xi-affirm-strategic-alliance-amid-unpredictable-world

CHINA AND EUROPE
EU seeks to persuade China to curb exports to the bloc reports Politico
On 31 August, Politico reported that the European Commission was exploring ways to convince Beijing to rein in its exports to the European Union as Brussels sought to narrow its trade deficit with China. EU Trade Chief Maroš Šefčovič said addressing the deficit required both increasing European exports to China and better managing Chinese exports into the bloc, describing a two-sided approach as the most effective path for the future relationship. He said the issue would need to be “tackled from both sides” to serve the long-term interests of both parties.
(“EU wants to convince China to curb exports to the bloc,” Politico, 31 August 2026)
https://www.politico.eu/article/eu-wants-to-convince-china-to-curb-exports-to-the-bloc/

CHINA READER DAILY WIRE

PREVIOUS CHINA READER DAILY WIRE