US President Donald Trump's administration will limit sales of Washington's civil nuclear technology to China out of concerns that it is being diverted for military and other unauthorized purposes, a top official said.
"The US cannot ignore the national security implications of China's efforts to obtain nuclear technology outside of established processes of US-China civil nuclear cooperation," Secretary of Energy Rick Perry said in a statement on Thursday.
The decision is the result of a broad government policy review led by the National Security Council and is driven by Beijing's efforts to obtain advanced technology, nuclear material and equipment from US companies, reports CNN.
"The administration concluded that a change in US civil nuclear cooperation with China is necessary to strike an appropriate balance between long-term risks to US national security and economic interests and the impact to the US nuclear industrial base," an administration official told the media on Thursday.
The review, which examined the economic and national security ramifications, was prompted by China's efforts to gain US intellectual property, sometimes illicitly, in ways that undermine American businesses and the military.
The administration official said China was "actively pursuing our advanced nuclear technology for diversion to military use in its third-generation nuclear power submarine, in the development of a nuclear-powered aircraft carrier and in strategic dual-use nuclear-powered platforms, such as small modular reactors and floating nuclear power plants deployable in the South China Sea".
The move comes as the US is waging a trade war against China, with roughly half the products Beijing sells to Washington each year now facing tariffs.
Beijing has retaliated with its own penalties on American products.
The new policy, which goes into effect immediately, sets guidelines for all existing, pending and future technology transfers to China.
(With inputs from agencies.)