Troop cuts announced by President Xi Jinping will further strengthen the People's Liberation Army's combat capability and pave the way for growth of the Navy and Air Force, according to observers.

The president, who is also commander-in-chief, announced a reduction of 300,000 troops before last Thursday's V-Day parade in Beijing.

"The troop cuts are good news because they indicate that the PLA is paying more attention to its operational capability rather than its size," said Xu Guangyu, a senior consultant at the China Arms Control and Disarmament Association and a retired major general.