TLDR: China is rapidly integrating artificial intelligence into its industrial landscape, moving beyond traditional automation to deploy advanced AI agents and large language models. This strategic shift is yielding significant gains in productivity, efficiency, and quality across various sectors, positioning AI as a core driver of the nation’s industrial evolution.
China’s industrial sector is experiencing a profound transformation, with artificial intelligence emerging as the indispensable engine of its evolution. This strategic pivot, dubbed ‘Industry plus AI,’ is being spearheaded by the nation’s tech companies, which are actively developing sophisticated AI agents to address complex industrial challenges.
A prime example of this integration can be observed at a textile mill in Suzhou, Jiangsu province. Here, China Telecom’s ‘StarWeave Textile AI Agent’ operates tirelessly, harmonizing the rhythmic clatter of looms with its silent, rapid-fire calculations. This AI agent meticulously adjusts thread tension in real-time and scrutinizes fabric for flaws as it emerges, fundamentally transforming an age-old craft. The tangible results are impressive: a reported 99 percent on-time delivery rate, a 20 percent surge in productivity, and near-perfect defect detection, according to China Telecom.
This is not an isolated experiment but a glimpse into a sweeping national initiative. AI agents, unlike traditional AI that merely assists or provides recommendations, are software systems capable of executing complex workflows and pursuing goals without continuous human input. They are purpose-built to perform specialized roles within companies, ranging from customer support and data analysis to compliance checking and financial tasks.
The Chinese government is actively championing this shift. Li Lecheng, Minister of Industry and Information Technology, recently chaired a meeting in Beijing, outlining a comprehensive strategy to accelerate AI technological innovation and its integrated application, thereby positioning AI as a core driver of China’s new industrialization. Furthermore, Xie Shaofeng, chief engineer at the Ministry of Industry and Information Technology, announced the coordination with provincial governments to establish 11 national AI innovation pilot zones, fostering a robust ecosystem for AI development and deployment.
The financial commitment to this transformation is substantial. International Data Corp (IDC) forecasts China’s industrial AI spending to reach 90 billion yuan ($12.53 billion) by 2028, a clear indicator of the accelerating adoption. This investment is fueling a fundamental evolution in how Chinese industry operates, shifting from fragmented point solutions towards interconnected, increasingly autonomous systems.
Market research data underscores this seismic shift: the proportion of Chinese industrial enterprises deploying large models and intelligent agents has skyrocketed from 9.6 percent in 2024 to an impressive 47.5 percent in 2025. Crucially, the proportion of those implementing these technologies across multiple operational areas has exploded from 1.7 percent to 35 percent. Cui Can, senior research manager of IDC China, noted, ‘We’re moving rapidly beyond isolated pilots,’ emphasizing that industrial AI agents represent a critical lever for driving the innovation cycle for essential industrial assets like datasets and large language models, creating a self-reinforcing ecosystem for advancement.
Hong Qunlian, a researcher at the National Development and Reform Commission’s Chinese Academy of Macroeconomic Research, highlighted the strategic importance of this move, stating, ‘Manufacturing is the focal point of competition among major powers and technological supremacy. Nurturing strategic advantages for the future fundamentally relies on the high-quality development of our manufacturing industry.’ She further stressed that ‘Promoting AI-driven industrial upgrading is paramount for China’s real economy over the next five years.’
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Beyond textiles, the application of AI is broad. Electric vehicle giant BYD, for instance, has harnessed AI end-to-end, from battery research and development and design automation to manufacturing and autonomous driving systems, fundamentally reinventing operations to accelerate time to market and capture dominant market share. Experts also point to significant potential in traditional sectors such as mining, steel, nonferrous metals, petrochemicals, and machinery, where repetitive or dangerous tasks can increasingly be performed by AI or AI-powered machines. This comprehensive approach signifies ‘corporate reinvention,’ where AI is viewed as a strategic engine rather than merely a productivity tool.
