China Aerospace Science and Industry Corp, a major space contractor, is considering the establishment of a satellite company to tap the space-based communications market, according to a project insider.

Tan Qianhong, Party chief of China Space Sanjiang Group, a CASIC subsidiary in Hubei province, said Sanjiang has submitted a plan on the proposed satellite firm to CASIC and is waiting for approval.

The new entity would focus mainly on the research, development and launch of small satellites that would operate in low orbit and provide narrowband communications service, Tan told China Daily in an exclusive interview. Tan spoke on the sidelines of the 19th National Congress of the Communist Party of China, to which he is a delegate.

"General Secretary Xi Jinping has stressed that China's modernization drive will not succeed without the completion of informatization," he said. "Space-based infrastructure is a pillar of the information industry. The new company would be tasked with forming a satellite constellation to boost space-based communications."

Informatization is the development of an information-based economy.

The network would offer coverage to users at sea or in remote regions that have poor access to ground-based communications services, according to Tan. He said the proposed firm would have a team of satellite designers but would procure others' satellites if they have better cost-performance ratios.

Tan said Sanjiang also would continue to improve the capabilities of its Kuaizhou-series carrier rockets, a major product of the company, and use them to acquire more commercial space contracts.

In China, the commercial space industry generally includes development and production of spacecraft not sponsored by the government as well as non-State launch activities. While China has a long history of space exploration, commercial involvement in space is a new idea that is gaining popularity among State-owned space contractors and private enterprises in the wake of the country's rocketing demand for space-based services.

"We will strive to reduce our rockets' costs and to strengthen their capacities. We will also introduce private capital and partners in the rockets' production to optimize the outsourcing and marketing work," he said.

Sanjiang began to develop Kuaizhou-series solid-fuel rockets in 2009 in hopes of presenting a low-cost, quick-response rocket family to the commercial launch market. It has launched three of the rockets－two Kuaizhou 1 models and one Kuaizhou 1A.

In 2018, Sanjiang plans to launch four Kuaizhou 1A rockets within one week. Each will lift a remote-sensing satellite into orbit for a client. The missions are expected to set a world record for launch frequency for a single model of carrier rocket, the company said.

A new-generation rocket, the Kuaizhou 11, is being tested and will make its first flight next year, sending six satellites into orbit, according to Sanjiang.

The Kuaizhou 11 will have a liftoff weight of 78 tons and will be capable of placing a payload of 1 metric ton into a sun-synchronous orbit at an altitude of 700 kilometers, or a 1.5-ton payload into a low-Earth orbit.