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Guarding the Great Wall: The Fate of Defence SOE Leaders
Anushka Saxena
On February 4, 2026, the Standing Committee of the 14th National People’s Congress (NPC) convened in Beijing for an unusual, ‘Emergency’ session. In it, the NPCSC announced the immediate removal of three deputies from the legislature, who also happen to be pivotal leaders in China’s defence industry – Zhou Xinmin, former Chairman of the Aviation Industry Corporation of China (AVIC); Luo Qi, Chief Engineer of the China National Nuclear Corporation (CNNC); and Liu Cangli, former Director of the China Academy of Engineering Physics (CAEP).
The emergency session to dismiss Zhou, Luo and Liu was definitely unique in that this is the second such session of the 14th NPC – the first having been called on July 25, 2023, to remove Qin Gang from the post of Foreign Minister. Likely, the hasty removal could be because of a few reasons – the harm these leads have brought about in their domains (aerospace and nuclear) was causing major national security issues and decisive action had to be taken; their arrest was imminent and some announcement to remove them was essential; or it’s just Xi Jinping bringing down his house of cards to re-build it as soon as possible.
The press release No. 15 from the session, highlighting the dismissals, said:
The Standing Committee of the Shanghai Municipal People’s Congress has decided to remove Zhou Xinmin from his position as a deputy to the 14th National People’s Congress. The Standing Committee of the Shandong Provincial People’s Congress has decided to remove Luo Qi from his position as a deputy to the 14th National People’s Congress. The Standing Committee of the Sichuan Provincial People’s Congress has decided to remove Liu Cangli from his position as a deputy to the 14th National People’s Congress.
In accordance with the relevant provisions of the Law of the People’s Republic of China on Deputies to the National People’s Congress and to the Local People’s Congresses at Various Levels, the deputy qualifications of Zhou Xinmin, Luo Qi, and Liu Cangli are terminated.
In accordance with the relevant provisions of the Election Law of the People’s Republic of China on the National People’s Congress and Local People’s Congresses at Various Levels, Luo Qi’s positions as a member of the Standing Committee of the 14th National People’s Congress and as a member of the Education, Science, Culture and Public Health Committee of the National People’s Congress are correspondingly revoked, and Liu Cangli’s position as a member of the Standing Committee of the 14th National People’s Congress is correspondingly revoked.
Zhou, Luo and Liu are only the latest to fall in a series of purges targeting leaders of top Defence State Owned Enterprises (SOEs) in China. Since 2023, over 15 such leaders have been caught in the net for a range of crimes, from embezzlement, bribery, and insider trading, to “loosing of ideals and beliefs” and “abusing power.” I have prepared a list of defence SOE leaders targeted between 2023 and 2026, along with the crimes for which they have been charged (based on publicly available data and reports). Before we get to that, who were they whom the NPCSC dismissed at the emergency session?
Zhou Xinmin (周新民)
Zhou Xinmin served as Chairman of the Aviation Industry Corporation of China (AVIC), the state-owned behemoth responsible for developing and producing the PLA Air Force’s most advanced platforms, including the J-20 stealth fighter, the Y-20 transport, and the much-anticipated H-20 strategic bomber.
Zhou’s tenure was brief and tumultuous. He assumed the chairmanship in March 2024, replacing Tan Ruisong, who himself had been investigated for corruption in August 2024, and expelled from the CPC in early 2025. Removing Zhou less than two years into his tenure indicates extreme volatility in AVIC’s leadership structure. His removal followed an internal AVIC meeting on anti-corruption held just one day prior, on February 3, 2026, likely suggesting that his downfall was immediate and linked to specific findings of the CCDI inspection teams embedding themselves within the defence SOEs.
Zhou’s background was deeply rooted in the technical aspects of aviation manufacturing. Before becoming AVIC Chairman, he was a key figure in the commercial aircraft sector, holding senior roles including Vice Chairman, General Manager, and Deputy Secretary of the Party Committee of COMAC. COMAC, of course, is an SOE best known for its C919 narrow-body jetliner, which is supposed to be China’s answer to the Airbus-Boeing duopoly in the 150+ seater commercial jetliner domain. Before that, he also led Changhe Aircraft Industry (Group) Co., Ltd. (CAIG), a subsidiary of AVIC and a provider of helicopters and drones to the PLA.
Luo Qi (刘仓理)
Luo has been the Chief Engineer of the China National Nuclear Corporation (CNNC), a doctoral supervisor at the China Nuclear Power Research and Design Institute, and a prominent Academician with the Chinese Academy of Engineering (CAE). His tenure coincided with that of the now-disparaged Gu Jun, former General Manager of CNNC, removed from his position in January 2026.
Luo was instrumental in developing the “Hualong One” reactor, China’s flagship indigenous third-generation nuclear power technology, which Beijing has aggressively marketed for export as part of the Belt & Road Initiative.
However, Luo’s role extended beyond the civilian sector. CNNC is the primary contractor for the propulsion systems of the PLA Navy’s nuclear submarine fleet (Type 094/ 096 SSBNs and Type 093/ 095 SSNs). His removal, therefore, has direct implications for the modernisation of China’s sea-based nuclear deterrent. Reports indicate that early signs of his political demise appeared in March 2025, when he was conspicuously absent from the presidium list for the annual ‘Two Sessions’.
Liu Cangli (刘仓理)
Liu Cangli is the former Director of the China Academy of Engineering Physics (CAEP). He was in that position for 9 long years, from 2019 to 2024. He also held the high honour of being an Academician with the Chinese Academy of Sciences.
CAEP, or the Ninth Academy [九院], referred to by some as the “Los Alamos of China,” is headquartered in Mianyang, Sichuan, and is the sole institution responsible for the research, development, and testing of China’s nuclear warheads. It is also a vice-ministerial-level body.
Liu’s position placed him at the center of China’s most sensitive state secrets. Unlike Zhou (a corporate manager) or Luo (an engineer), Liu was a scientist-administrator overseeing the physics packages of the rocket forces. He was under investigation since 2024 itself.
Together with the dismissals of Zhou, Liu and Luo, the earlier dismissals of Wu Yansheng (CASC), Liu Shiquan (NORINCO), and Wang Xiaojun (CALT) point to a systemic crisis in the management, manufacturing and delivery of conventional and strategic delivery systems.
So before you delve into the list of defence SOE officials who have come under the radar for various crimes in the past three years, please remember the following common euphemisms in official Chinese discourse and articulation on investigations, suspicions and issuance of criminal charges:
“Serious violations of discipline and law” (严重违纪违法) = Largely pertains to a wide varieties of corruption
“Lost ideals and beliefs” = Largely pertains to ideological or political disloyalty
“Engaged in superstitious activities” = Un-Marxist behavior
“Resisted organisational scrutiny” = Non-cooperation with investigators
Further, typical categories of charges include:
Bribery: Accepting cash, property, favours & kickbacks, or even dinners
Abuse of Power: Using position for personal gain or gain of networks
Embezzlement: Misappropriating State/ Company funds
Favouritism: Helping others obtain contracts, promotions, and acquisitions
Lifestyle Issues: “Power-for-sex transactions,” extramarital affairs
Causing Losses: Largely, decisions that harmed “national interests”
It is no surprise that as military leadership in the PLA and the Central Military Commission (CMC) continued to be constantly targeted between 2023 and now, revealed networks of corruption, kickbacks and favours also showed how leaders of defence business and industry were and are important actors in the ecosystem. In fact, if there was actually water in missiles, if silo doors in Xinjiang were actually fake or dysfunctional, and if Li Shangfu’s tenure as head of the CMC Equipment Development Department actually revolved around rigging of bidding and procurement, it couldn’t have been without a mutual transaction with some such SOE officials.
This was also expected, considering in July 2023 the CMC EDD had made clear its plans to investigate and rectify violations of regulations and discipline by experts involved in equipment procurement bidding and review activities. In China’s procurement ecosystem, the “experts” tasked with technical evaluations of defence equipment may have exploited loopholes in selecting the right SOEs or private-sector firms for the job, or may have leaked trade secrets to make bidding easier for select contractors. Inspections of the equipment in field testing, as is common in the CCP-PLA operational relationship, would have hence revealed mediocrity in quality or management. Internal investigations may have shed light on officials accepting kickbacks or pocketing budgets intended to enhance real combat capability, ultimately leading to the disappearance of some who wavered.
The culmination of the investigations is constantly being made evident, as the CCDI and NSC appear to be dismantling a horizonal & vertical integration of corruption (tiao-kuai, in Lieberthal’s words), where procurement officers and industrial leaders conspired to inflate costs, substitute inferior materials, and siphon off the massive budget increases allocated for military modernisation.
In related news, the CCDI & NSC website published a special commentary marking the beginning of New Year & Spring Festival Holidays on February 12 with a firm warning against corruption. In it, authors make the case that high pressure of malicious actors must be sustained without pause or retreat. Focus must be placed on key problems, key sectors – such as finance, SOEs, energy, education, associations, development zones, bidding and tendering – and key targets, including leading cadres and younger officials. Both bribe-takers and bribe-givers must be investigated. New and hidden forms of corruption – such as “shadow companies,” “options trading,” “agreed proxy shareholding,” and “revolving doors” between government and business – must be addressed through technological empowerment and big data analysis. Grassroots rectification in areas such as rural collective assets, medical insurance funds, and elderly care must be deepened. Notably, a lot of this messaging relates directly to the work of SOEs and the defence industry.
The article also releases crucial data for 2025: 65 centrally managed officials were publicly reported as having fallen from office, and discipline inspection organs nationwide filed 1.012 million cases, handling 1.984 million persons using the “four forms” of discipline.
As I conclude, the important question to ask, is this – what do the purges of really vital nuclear and aerospace scientists means for China’s combat preparedness and defence industry? Maybe, the vaccuum left by the dismissal of such leaders only tanks stock prices, and doesn’t necessarily impact warfighting capability. And yet, it is fair to assume existence of the possbility that the shiny exteriors of a J-20 fighter or a Type 055 destroyer do not speak for either the professionalism or the trustworthiness of those who make OR command them. In any case, the NPCSC’s emergency session proves that Xi Jinping and his remaining team are willing to resolve these structural issues rather quickly – even if it means stacking a whole new deck by the 21st Party Congress in 2027. Whether that will cement Xi’s power and prosperity in his potential 4th term, or have rather drastic consequences for the party-state, remains to be seen.
*ANNEX: Sources from the table formulated above
Source: CCDI
Source: CPPCC
Source: Supreme People’s Procuratorate
Source: Beijing Municipal Commission for Discipline Inspection and Beijing Municipal Supervisory Commission
Source: Shaanxi CPPCC on Weixin
Source: Beijing News Client
Source: Sohu
Source: Jiefang Daily
Source: Global Times
Source: PRC State Council
Source: Caixin
Source: People’s Daily
Source: CCTV
Source: Procuratorial Daily & Justice.cn
Eye on China is a weekly newsletter curated by the Indo-Pacific Studies Programme at The Takshashila Institution, a public policy think-tank based out of Bengaluru, India.
