China has tested the latest version of its fifth-generation stealth fighter, state media reported on Monday, as it tries to end the West's monopoly on the world's most advanced warplanes.

The test comes as the nation flexes its military muscles, sending its sole aircraft carrier the Liaoning into the western Pacific in recent days to lead drills there for the first time.

The newest version of the J-31 — now renamed the FC-31 Gyrfalcon — took to the air for the first time Friday, the China Daily reported.

The so-called “fifth-generation” twin-engine jet is China's answer to the US F-35, the world's most technically advanced fighter.

The new FC-31 has “better stealth capabilities, improved electronic equipment and a larger payload capacity” than the previous version which debuted in October 2012, the newspaper said, quoting aviation expert Wu Peixin.

“Changes were made to the airframe, wings and vertical tails which make it leaner, lighter and more manoeuvrable,” Wu told the paper.

The jet is manufactured by Shenyang Aircraft Corp., a subsidiary of the Aviation Industry Corp of China (AVIC).

The fighter is expected to sell for around $70 million, the article said, aiming to take market share away from more expensive fourth-generation fighters like the Eurofighter Typhoon.

AVIC has said that the FC-31 will “put an end to some nations' monopolies on the fifth-generation fighter jet”, the China Daily reported.

China is aggressively moving to develop its domestic weapons industry, from drones and anti-aircraft systems to homegrown jet engines.

In the past it has been accused of copying designs from Russian fighters, and some analysts say the FC-31 bears a close resemblance to the F-35.

When completed the FC-31 will become the country's second fifth-generation fighter after the J-20, which put on its first public performance at the Zhuhai Air Show in November.