Published on Jan. 15, 2026

China has announced a plan to modernise its manufacturing sector by integrating the industrial internet and AI. The Ministry of Industry and Information Technology (MIIT) in Beijing released the "Action Plan on Industrial Internet and Artificial Intelligence Integration and Empowerment” on January 6, 2026, the official Xinhua News Agency reported.

The goal was to "strengthen the country's manufacturing sector" by establishing "new-type industrial networks" at a minimum of 50,000 enterprises by 2028, the agency wrote. Until that time, "the level of integration between the industrial internet and AI will see marked improvements", the report continued.

Zhang Yi, Director of the Policy Research Institute at the China Academy of Industrial Internet, explained some of the ideas behind the plan in an interview with the online news portal Dayoo (dayang wang) (in Chinese) .

"The Action Plan will clearly accelerate the systemic transformation of China’s manufacturing sector. One can envisage future industrial production rapidly evolving toward end-to-end intelligence across all levels: device-level, production-line-level, workshop- level, factory-level, enterprise-level, and ecosystem- level", Zhang said.

At the device level, this entails intelligent upgrades to CNC machine tools, industrial robots, sensors, and industrial cameras and will enable smart perception, execution, interaction, and collaboration, improving equipment operating efficiency, the researcher explained.

At the production-line level, the action plan aims to bring about an "intelligent transformation of industrial control systems such as PLCs, DCSs, and HMIs", he said. By establishing production control models and intelligent scheduling models, the planners want to form a closed loop of “perception – decision – execution” and enable flexible manufacturing, Zhang explained.

Another part of the plan is the widespread deployment of AI large and small models combined with edge intelligence, he said. The goal is that production tasks can be intelligently orchestrated, significantly improving efficiency.

He also provided some details dealing with enterprise management and a smarter "industrial ecosystem" by using AI to optimise processes and communications across whole supply chains.

The plan employs the usual toolset of China's central planners by formulating high-level goals, which are usually broken down into more concrete and specific tasks in the following weeks and months by other officials at provincial and local levels and in state-run enterprises.

The numerical target of "not fewer than 50,000 enterprises" in which the industrial internet is to be integrated with AI is meant to pressure lower ranking officials and establish a reporting framework.

Only one day after this plan was published, on January 7, 2026, MIIT and seven other government departments published a related document meant to accelerate the deployment of AI in the manufacturing sector.

It is called "Implementation Opinions on the Special Action Plan for ‘Artificial Intelligence + Manufacturing".

Its stated goal is to "achieve a safe and reliable supply of artificial intelligence technologies” in China by 2027. It links general government support for large AI models with concrete use cases for industrial AI, again demonstrating that Beijing is clearly focused on putting the algorithms to practical use as fast as possible.

In that second document, the central government sets down more numerical targets such as the "deep application of three to five general-purpose large AI models in manufacturing, develop the specialised, full-coverage industry-specific large models, the creation of 100 high-quality industrial datasets, and the promotion of 500 typical application scenarios".

The background for all this bureaucratic activity within the first week of the new year is China's recent fundamental pivot of its industrial policy "from quantity to quality". President Xi Jinping and other party and government leaders have explained the new development paradigm in a number of speeches and policy documents.

In essence, faced with the dual pressure of a shrinking and rapidly ageing population, fearing that the current economic model of exporting relatively cheap manufactured goods will no longer be sustainable, China now wants to give science and technology a more central role.

Beijing now promotes the development of "high-quality productive forces", meaning technologies like artificial intelligence or biotechnologies, nurturing future industries like the low-altitude economy with its freight drones and flying cars, advanced material sciences and many others.

On top of promoting the country's modernisation with future technologies and emerging industries, the pivot explicitly also includes a comprehensive upgrading of existing, traditional industries through digitalisation and the integration of AI.

There are a number of other internal factors that make the central planners in Beijing believe that they have to act fast to harness the power of AI. Economic growth has slowed down markedly over the past years and youth unemployment has been on the rise.

Looking at the external environment, China feels under pressure from Washington's chip boycotts and trade sanctions, which have the goal of denying the country access to advanced AI chips and related technologies, with the United States arguing that those measures are necessary for its own national security.

For those reasons, Chinese analysts see Beijing's plans to promote the development and fast industrial deployment of AI also in the context of the AI race with the United States.

In a recent interview with the state outlet Global Times in Beijing, Wei Shaojun, Vice-President of the China Semiconductor Industry Association, has warned that China's domestic semiconductor industry must remain vigilant and "uphold its commitment to advancing domestic capabilities in cutting-edge technologies".

While Beijing promotes the development of home-grown AI chips with investment funds playing catch-up with the likes of Nvidia, Beijing feels it has an edge over the U.S. in industrial AI due to its huge manufacturing sector.

Infusing its existing supply chains with AI as fast as possible, Beijing hopes, will not only let the economy grow in the coming decade, but also defend the country against "hostile foreign forces".