U.S. military-funded research has “directly or indirectly” benefitted Chinese firms linked to the People’s Liberation Army, according to an April 2025 study by Parallax Advanced Research, a defense contractor based in Ohio. “The U.S. is inadvertently accelerating China’s military modernization and eroding its own technological edge,” argued former Air Force intelligence officer L.J. Eads, the study’s author.

In 2023-2024, U.S. Army, Navy, or Air Force research offices spent more than $48 million on 17 different research projects that involved “Chinese Military Companies (CMCs) — entities formally designated by the U.S. government as threats to national security,” the report catalogued.

The Chinese Communist Party routinely scavenges intellectual property from private companies, including stealing intellectual property from American companies doing business in China. So it comes as little surprise that there are Chinese companies who, it is safe to assume, share their research and discoveries with the totalitarian regime.

The vast majority of compromised projects involved collaboration with Chinese tech giant Huawei:

• The Army Research Office provided $24 million to Massachusetts Institute of Technology (MIT);
• The Office of Naval Research provided $3.5 million in four separate grants to Virginia Polytechnic Institute & State University (with additional funds through the National Science Foundation [NSF]);
• The Air Force Office of Scientific Research provided $299,000 to the University of Wollongong (Australia);
• The Office of Naval Research provided $1.5 million in two separate grants to SRI International, and the Naval Research Laboratory provided $925,000 to the University of Illinois for the same project;
• The Air Force Office of Scientific Research provided $1.4 million to Vanderbilt University;
• The Office of Naval Research provided $300,000 to École Normale Supérieure Paris-Saclay (France);
• The Office of Naval Research provided $778,000 to The Ohio State University and $299,000 to the University of Maryland, College Park (with additional funds through NSF);
• The Air Force Office of Scientific Research provided an unspecific amount to Princeton University (with additional funds provided by Huawei itself) — on four separate projects, two of which also involved Stanford University;
• The Office of Naval Research provided nearly $1.5 million, and the Army Research Office provided $9.7 million to a University of Southern California researcher who collaborated with EURECOM researchers funded by Huawei and the Chinese University of Hong Kong (with additional funds through NSF);
• The Army Research Office provided $465,000 to Michigan State University, other U.S. universities, and Hong Kong-based universities on a project also funded by Huawei (with additional funds through NSF)

Huawei was not the only Chinese actor to make the list. Four projects entailed collaboration with other suspect Chinese entities.

• The Office of Naval Research provided $547,000, plus an additional unspecified amount to the University of California, Santa Cruz, in collaboration with China’s BGI Research (with additional funds through NSF);
• The Army Research Office provided $1 million to Washington University, in collaboration with China Mobile Group Co., Ltd. (with additional funds through NSF);
• The Army Research Office provided $646,000 to the University of Tennessee at Knoxville, which collaborated with Chinese researchers funded by China General Nuclear Power Group (CGN), which has been sanctioned for attempting to steal and weaponize U.S. nuclear technology (with additional funds through NSF);
• The Office of Naval Research provided $1.5 million to Yale University, via the University of Illinois, in collaboration with researchers from Tsinghua University who received funding from the China Mobile Research Institute (with additional funding through NSF)

The report provided at least minor clues to what the research projects involved. According to the Parallax report, some of the most important research projects on the list involved “research on UAV-aided RF mapping” (in other words, high-tech drone instruments) and “AI-enabled decision-making.”

“Clear congressional intent” to prevent DOD grants from aiding China’s military has been expressed in the National Defense Authorization Act (NDAA), Eads argues. And “current DoD policy … requires mitigation under internal research security guidance.” However, he adds that these “mitigation measures are informal, inconsistently applied, and ultimately insufficient.”

The situation seems remarkably similar to the vulnerabilities that existed in USAID grants, which inadvertently provided more than $150 million to terror-linked organizations because the agency failed to vet sub-awardees, according to a report released in February.

It is not enough for federal agencies that dispense grants to award those projects to reputable organizations. They must also confirm that sub-grantees or sub-awardees (those hired by the main organization to complete part of the work) are not aligned with our adversaries.

The Parallax report urged “immediate policy action” to “prevent further entanglement of U.S. defense research with Chinese Military Companies (CMCs).” Among other things, it urged the DOD to adopt a “categorical ban on DOD funding to projects involving CMCs,” as opposed to optional exclusion. It also urged the DOD to adopt “automated pre-award screening” instead of belated “mitigation” measures.

As a research-based defense contractor, Parallax obviously stands to gain by excluding potential competitors for U.S. military research grants. But that does not mean the company is wrong when it points out the alarming intrusion of Chinese companies into U.S. defense research. If a Chinese company’s Panamanian ports threaten U.S. national security, then a Chinese company’s direct participation in critical DOD research projects represents a threat much closer to home.