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China’s Dahua Technology to Exit Projects in Xinjiang

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Zhejiang Dahua Technology (002236.SZ), a major Chinese video surveillance equipment maker, announced on Monday that it and its subsidiaries will terminate or exit five projects in China’s Xinjiang region. The projects, which were awarded between 2016 and 2017, include both terminated contracts and those still in operation, according to a filing with the Shenzhen stock exchange. Dahua confirmed it would cease operating the projects and initiate asset disposal and debt resolution procedures, but did not provide a specific reason for the withdrawal.

This move follows a similar decision by Hikvision (002415.SZ), another Chinese surveillance camera manufacturer, which also exited contracts with five Xinjiang local governments earlier this month, without disclosing the reasons.

Dahua’s exit comes amid heightened international scrutiny. The U.S. government added Dahua to its trade blacklist in 2019, accusing the company of involvement in “repression and high-tech surveillance” against Uyghur Muslims and other minority groups in Xinjiang. Dahua has consistently denied these allegations, arguing that the U.S. decision was not based on factual evidence. The Chinese government has also rejected claims of human rights abuses in the region and criticized companies that sever ties with firms operating there.

 

Exclusive: Russia Secretly Developing War Drones in China, Intel Sources Reveal

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Russia has launched a covert drone production program in China aimed at developing long-range attack drones for use in Ukraine, according to European intelligence sources and documents reviewed by Reuters. The project, led by IEMZ Kupol, a subsidiary of Russian arms giant Almaz-Antey, has reportedly been developing and testing a new drone model, Garpiya-3 (G3), in China with assistance from local experts. Documents show that Kupol informed Russia’s defense ministry that they could produce drones, including the G3, on a large scale at a factory in China to support Moscow’s war efforts in Ukraine.

Kupol and the Russian defense ministry have not commented on these revelations, while China’s foreign ministry denied knowledge of the project, emphasizing strict export controls on unmanned aerial vehicles (UAVs). However, this collaboration, if confirmed, would represent a significant shift in China’s involvement in Russia’s military operations. Previously, China had been providing dual-use components, but full drone systems have not been documented in open sources.

The White House National Security Council expressed concern, stating that while there is no evidence that the Chinese government is involved, it is China’s responsibility to ensure its companies are not providing lethal aid to Russia. NATO and Britain’s Foreign Office echoed these concerns, urging China to halt material support for Russia’s war effort.

Kupol’s G3 drones reportedly have a range of 2,000 km with a 50 kg payload. Invoices indicate that seven drones, including two G3s, have already been delivered to Kupol’s headquarters in Russia for further testing. The European intelligence sources described these deliveries as the first verified evidence of entire UAV systems being shipped from China to Russia since the war in Ukraine began.

The intelligence also suggests that Kupol is working with a Chinese company, Redlepus, to establish a joint drone research and production facility in Kashgar, China’s Xinjiang province. The planned facility, labeled the “Advanced UAV Research and Manufacturing Base,” would produce up to 800 drones annually, although no operational timeline was provided.

Kupol has also proposed the production of a new Chinese-designed attack UAV, the REM 1, with a payload of 400 kg, comparable to the U.S. Reaper drone. While Russia and Ukraine are both racing to increase drone production, China’s potential role in directly supporting Russian efforts could expose Beijing to sanctions. Experts believe this could significantly alter China’s international standing, as it navigates the delicate balance between maintaining its strategic alliances and avoiding punitive global repercussions.