China plans to boost defense spending to $130 billion, a 12 percent increase.
At the opening of the National People's Congress in Beijing Wednesday, a major political meeting, officials also said they expect the economy to continue to see stable growth of around 7.5 percent this year.
China's leaders say they faced tough challenges in 2013 including a slowing global economy, fluctuating exports, and natural disasters. Premier Li Keqiang says risks and hidden dangers remain for the world's second largest economy.
"There are still many problems people are unhappy with," Li said. "Serious and industrial accidents occur frequently. The social safety net needs strengthening and problems of corruption crop up time and time again."
Li attributes some of the some problems to China's status as a developing country, but acknowledges the government could do a better job.
Last year, China's leaders spoke at length about corruption. This year at the annual meeting, they talked about the need for transparency of budgets.
"Governments at all levels should release their budgets and final accounts to the public, and budgets released by government bodies should progressively include details down to itemized expenses," said Li. "Public spending on official overseas visits, official vehicles, and official hospitality should be made public to ensure transparency and make it easy for people to understand and oversee it."
China's National People's Congress meets once a year to discuss legislation, outline policy direction for the year ahead and approve budgets, including increased defense spending.
"Last year, we made solid progress in strengthening national defense," Li said. "The armed forces and armed police force are full of new vigor and have enhanced capabilities. This year, we will comprehensively enhance the revolutionary nature of the Chinese armed forces, further modernize them and upgrade their performance and continue to raise their deterrence and combat capabilities in the information age."
For years, China's military spending has been expanding at a double-digit pace but the officially disclosed figures show it's still one-sixth the size of the Pentagon's budget.
Even so, Beijing's rapid growth in military spending has increasingly been a point of concern in the region, especially as the country has become more assertive of its territorial claims on land and at sea.
Li says China will strengthen its research and development of new and high-tech weapons technology and equipment. He also says China will resolutely uphold its maritime rights and interests and build China into a maritime power.