By Jim Wolf
Thu Jun 23, 2005

WASHINGTON (Reuters) - The U.S. Defense Department said on Thursday it would supply Taiwan with key elements of a missile and air defense capability, a move aimed at defusing the threat from China.

Raytheon Co. won a U.S. Air Force contract worth up to $752 million to supply the Early Warning Surveillance Radar by September 2009, the Pentagon said.

In a move bound to anger Beijing, which views Taiwan as a renegade province, the system will let Taiwan's air force detect and track long- and short-range ballistic missiles, cruise missiles, enemy aircraft and surface ships with "no doubt" reliability, said Raytheon, based in Waltham, Massachusetts.

The system includes an ultra-high frequency "phased array" radar to be integrated with Taiwan-supplied beacons that identify aircraft as friends or foes as well as two missile warning centers, a Defense Department contract announcement said.

Raytheon began exploratory talks with Taiwan on the project in 1996, said Dan Martin, a vice president of the company's Integrated Defense Systems business unit.

Such a system represents an important step toward identifying any inbound threats, said James Mulvenon of the Center for Research and Analysis, a Washington-based group that consults for U.S. intelligence agencies.

Eventually, it could be mated with Patriot Advanced Capability 3, or PAC-3, anti-missile batteries the United States has also offered to sell Taiwan.

"The surveillance radar is the first step in the chain of engagement," said Martin.

Mulvenon said Beijing would be particularly upset because missiles were at the forefront of its strategy for coercing Taiwan, a democratically governed island China has vowed to return to its fold by force if necessary.

"This raises the possibility that Taiwan will actually be able to defend itself against those missiles," Mulvenon said.