It is also most likely that China will carry on intimidating Taiwan before 2008, according to a report by the defense ministry made available to lawmakers along with its 2004 defense budget proposal.

"After 2008, if our country's defense capabilities are not sufficiently boosted, the military imbalance will create a favorable condition for China to paralyse us militarily and launch an attack," the report said.

An invasion will be possible if the international situation turns unfavorable to Taiwan or when the hawks in the Chinese military get the upper hand, it said.

Political instability on the mainland could also prompt an attack on Taiwan, it added.

But the ministry saw slim chance for a drastic political change on the mainland during the term of Chinese President Hu Jintao, who like his predecessor Jiang Zemin, has maintained close interaction with the international community.

The report said as of the end of 2002, China's armed forces totalled some 2.3 million, with 64 percent of them being ground troops.

Six percent of the armed forces are artillery troops, which have deployed more than 400 ballistic missiles aimed Taiwan, it said.

Meanwhile, the Chinese air force owns some 3,000 fighters, one-third of which are deployed within 600 nautical miles (690.5 miles) of Taiwan.

Last month, Washington also warned in its annual report to the US Congress that China's military modernizations were giving Beijing the ability to launch a surprise attack on Taiwan that would keep US forces in the western Pacific at bay.

The United States said Beijing was annually adding 75 short-range missiles across from Taiwan and was acquiring or developing weapons and tactics aimed at countering technologically superior US forces.

Washington has been the leading arms supplier to Taiwan, despite switching its diplomatic recognition from Taipei to Beijing in 1979.

China and Taiwan split in 1949 at the end of a civil war, but Beijing has repeatedly threatened to invade Taiwan if the island declares independence.

In the budget proposal submitted to parliament Friday, the ministry planned defense spending of 265 billion Taiwan dollars (7.75 billion US) in 2004, up 7.8 billion from this year.

Taiwan Premier Yu Shyi-kun reportedly guaranteed the United States last year that Taiwan would invest 700 billion Taiwan dollars in modern weaponry in the 10 years beginning 2006.

Local reports have said Taiwan is prepared to push that schedule up by one year and begin its own military buildup in 2005.

On the military's shopping list are eight conventional submarines, long-range early warning radar systems and Patriot PAC-3 anti-missile systems.

WAR.WIRE