The submarine is one of eight new vessels being developed under a multibillion-dollar programme to bolster Taiwan’s naval defences in the event of war with China.

Taiwan unveiled its first domestically-made submarine on Thursday, a major step in a years-long project aimed at strengthening the island's defence and deterrence against a possible Chinese attack.

President Tsai Ing-wen, who initiated the plan when she took office in 2016, presided over the launch ceremony in the southern port city of Kaohsiung. 

"History will forever remember this day," Tsai said as she stood in front of the towering submarine draped in the emblem of Taiwan's flag.

"In the past, a domestically developed submarine was considered an impossible task. But, today, a submarine designed and manufactured by our country's people sits before our eyes," Tsai said, adding it would play an important role in strengthening the navy's "asymmetric warfare" capabilities.

"Even if there are risks, and no matter how many challenges there are, Taiwan must take this step and allow the self-reliant national defence policy to grow and flourish on our land."

Taiwan, which China claims as its own territory, has made the indigenous submarine programme a key part of an ambitious project to modernise its armed forces as Beijing stages almost daily military exercises to assert its sovereignty.

China has sharply increased the number of military vessels it sends into the waters around Taiwan over the past year, and US officials have warned Beijing could be militarily capable of mounting an invasion within the next few years.

Taiwan is a self-governing island which China views as a renegade province and has vowed to reclaim one day, by force if necessary. But Taipei has rejected China's claim, insisting the island is a de facto sovereign nation.

The submarine, named “Haikun”, is one of eight new vessels being developed under a multibillion-dollar programme to bolster Taiwan’s naval defences in the event of war with China.

The $1.54bn (£1.27bn) diesel-electric powered submarine will undergo several sea trials before delivery to the navy by the end of 2024, according to military officials.

The Haikun uses a combat system by US defence company Lockheed Martin and will carry US-made missiles.

The submarine programme draws on a coalition of expertise and technology from several countries including the US and the UK, according to a Reuters report — a milestone for diplomatically isolated Taiwan.

Taiwan hopes to deploy at least two such domestically developed submarines by 2027, and possibly equip later models with missiles, the head of the programme said this month.

Taiwan’s navy currently has only four submarines: two World War II-era vessels from the U.S. used for training and two bought from the Netherlands in the 1980s. Taipei launched its programme to build its own submarines in 2017 after years of failed attempts to update its fleet.