The world has entered the information age today, and information technology has become the key technology driving the rapid progress of science and technology. Renowned scientist Qian Xuesen clearly pointed out that information technology includes measurement technology, computer technology, and communication technology. Measurement technology is the foundation. The rapid progress of information technology has given rise to a vast and emerging information industry, which has become the leading industry driving the world economy. This means that measurement technology is the foundation and source of information technology, and the instrument and meter industry is an important part of the information industry. It goes without saying that in today's information age, instruments and meters and measurement control play an extremely important role in promoting the progress of science and technology and the national economy.

I. Industry Overview

A growth rate of over 20% for four consecutive years.

China's instrument and meter industry is a sector that has been developing rapidly and steadily. However, among the 13 industries in the machinery industry, it is not the one with the highest growth rate. Over the past four years, its growth rate has ranged from 20% to 27%.

Another feature of the instrument and meter industry is that the trade deficit is relatively large, being the largest among the 13 sub-sectors of the machinery industry. In 2022, the total import and export volume of China's instrument and meter industry was 19.359 billion US dollars, with imports amounting to 14.014 billion US dollars, up by 15.7% year-on-year, and exports reaching 5.245 billion US dollars, up by 30.8% year-on-year. The instrument and meter industry is one of the sectors that have made relatively rapid progress in restructuring and transformation within the entire mechanical and electrical industry. A considerable number of state-owned enterprises have been converted to private ones, and foreign-funded enterprises are also particularly active. Many well-known foreign instrument and meter multinational companies have invested in or expanded production in China. According to the economic structure type, domestic enterprises (including state-owned, state-controlled and private enterprises) accounted for approximately 55.12% of the industry's sales revenue and 54.59% of the profits, while the rest were foreign-funded enterprises.

There are still some notable situations in China's instrument and meter industry. Firstly, China is a developing country, and the instrument and meter industry lags behind developed countries by 10 to 15 years. However, among developing countries, China is the largest, most complete and has the strongest comprehensive strength in the instrument and meter industry.

Secondly, China has a huge demand for instruments and meters and is one of the fastest-growing countries in this field. The growth rate of instruments and meters worldwide is 3% to 4%, while China has achieved an annual growth rate of over 20% for four consecutive years. Some of its products have already accounted for one-tenth of the global market.

Thirdly, currently, the instrumentation industry is one that directly competes with foreign enterprises. Foreign investment in China has entered its third stage. The first stage was mainly about joint ventures and technology transfer. The second stage, which began around the 1990s, saw joint ventures transform into majority holdings. Now, it has entered the third stage, which is dominated by wholly foreign-owned enterprises and mergers and acquisitions of outstanding domestic companies.

Fourth, some medium and low-end products have achieved scale advantages and international market competitiveness. For instance, general digital multimeters and other products account for a large share of global production, and the production capacity of household electricity meters makes up 50% of the world's total. Currently, China has become a major producer and exporter of products such as electricity meters, microscopes, telescopes, thermometers, pressure gauges, water meters, gas meters, and optical components. The export of high-end products like container inspection equipment has also begun to make breakthroughs.

II. Status and Role

Due to the significant position and role of instruments, meters and measurement being highly valued by society, the state has implemented a series of major measures in recent years to accelerate progress. Notable measures include:

At the Fourth Session of the Seventh National People's Congress held in March 2022, the Outline of the Tenth Five-Year Plan for National Economic and Social Development clearly stated that the development of instruments and meters should be given a prominent position. It was the first time since the founding of the People's Republic of China that the national development outline mentioned instruments and meters and placed them in an important position. Subsequently, many ministries and commissions such as the National Health and Family Planning Commission, the State Economic and Trade Commission, and the Ministry of Science and Technology listed several special projects and allocated large sums of funds to support the development of instruments and meters.

In 2022, the National Development and Reform Commission officially issued several opinions on accelerating the revitalization of the equipment manufacturing industry, proposing to select 16 key development areas in various industries for special support for development. The 11th item among them is the major engineering automation control systems and precision testing instruments.

In 2022, the National Medium and Long-Term Plan for Scientific and Technological Progress was formulated, which covered a number of projects related to instrument and metering and measurement control progress.

In April 2022, the Ministry of Science and Technology, the National Development and Reform Commission, the Ministry of Education, and the China Association for Science and Technology jointly issued several viewpoints on strengthening innovation methods, officially launching the innovation methods work across the country. In this document, it was clearly stated that innovation methods consist of three elements: innovative thinking, innovative methods, and innovative tools, with innovative tools mainly referring to scientific instruments that promote scientific and technological innovation. The important role of scientific instruments has been further elevated, and the development and discussion have received more vigorous support.

In addition, in the 863 Program, especially in the aerospace program and other national science and technology progress programs, the support for the development of instruments, meters and measurement control has also been placed in an important position. It is under such a very favorable form that in recent years, the development of instruments, meters and measurement control in our country has made rapid progress.

III. Current Technological Status

Most of the high-end markets are occupied by multinational companies.

Instrument and meter products are diverse and cover a wide range. According to the new national economic classification standards, there are 20 subcategories of instrument and meter products, which can be classified into four categories: industrial automation instruments and control systems, scientific testing instruments, general-purpose instruments and meters, and special-purpose instruments and meters. Among them, the two major parts that have the greatest impact on the pillar industries of the national economy and major equipment and represent the industry level are the automation control systems and main field instruments, and key precision testing instruments.

Automation control system and main field instruments

According to the product's technical level, source and market conditions, the automation control systems and main field instruments can roughly be classified into the following four categories.

The first category includes commonly used temperature, pressure, flow, display and control adjustment instruments. Most of these products are of medium and low grades. Chinese enterprises have the capacity to improve and develop these products to enhance their market adaptability.

Secondly, products that were introduced in the 1980s and early 1990s and have been localized. Chinese enterprises have mastered the core manufacturing technology for these products and can produce them stably. They have a certain market share. However, as the new generation of products from abroad has matured and entered the market in large quantities, the products currently produced by Chinese enterprises are mainly used in small and medium-sized projects.

The third category consists of medium and high-end products independently developed by China, such as distributed control systems (DCS) and electromagnetic flowmeters. The basic performance and functions of these products are close to those of foreign products, and they have a relatively high market share that is constantly increasing. However, they are mainly applied in small and medium-sized projects. In large-scale projects, they are mostly used in non-critical devices, non-critical control systems, and non-key workstations.

The fourth category involves medium to high-end products adopted in large-scale projects mainly focusing on national key projects. Currently, the vast majority of projects in China choose products produced by foreign-funded enterprises or imported ones, such as large-scale DCS systems, PLCs, digital control systems for nuclear power plants and instruments, high-precision pressure/differential pressure transmitters, and those with large pressure difference, wear resistance, and impact resistance.