Locating system to help improve navigation (2)

"We have broken through the core technology. In 2013, we will finish the R&D on applications for smartphone users," Cao said.

Different from existing navigation systems, Xihe provides solutions for accurate indoor navigation, Cao said, adding: "There's a global race on for indoor navigation technology."

In August, 22 international companies, including Nokia, Samsung and Sony Mobile Communications, formed an alliance to develop indoor navigation technology.

The Japan Aerospace Exploration Agency is also researching an indoor navigation system.

According to the ministry, the number of cell phone users in China increased by 70 percent in 2009 and 100 percent in 2010. The sector's market value is worth more than 80 billion yuan ($12.8 billion).

A 30 to 40 percent annual increase is expected in the next five years, which means the output of industries related to navigation services will reach 225 billion yuan by 2015 and 400 billion yuan by 2020, according to official estimate.

Similarly, British vehicle consultancy firm SBD estimated that by 2015 China could be the world's largest navigation market.

"If we piece together indoor and outdoor navigation services seamlessly to meet the huge demand, China may become the industry leader," Cao said.

However, this is only part of the plan to develop everyday use of the Beidou navigation satellite system.