The China News Service has reported that China Aerospace Science and Industry Corporation (CASIC) will complete research, production and delivery of the new missile by 2015.
A military source revealed that the mew missile is a medium and long-range conventional missile with a travelling distance of 4,000km.
Used in both defence and attack, the new missile will be capable of dealing with threats from land, sea, air, space and cybernetic attacks.
"The project will also entail a three-year evaluation period. It extends the range of China's missiles and will therefore greatly enhance the national defence capabilities," the source added.
China has already deployed the indigenous Dong Feng 21D missile with the army, which has a firing range between 1,800km and 2,800km.
People's Liberation Army National Defence University military expert Li Daguang said the real combat capabilities of the missile in complicated situations were yet to be proved.