BEIJING (Reuters) - China launched a locally made navigation satellite into orbit early on Thursday, the Xinhua news agency said, just a month after Beijing announced grand space ambitions in a policy paper.

The Beidou satellite was carried aloft by a Long March 3A rocket launched from the Xichang launch center in China's southwest province of Sichuan at 00.20 a.m., the report said.

The launch will complete China's first satellite navigation positioning system, it said. This is the second satellite of its kind China has put into orbit, following the launch of a similar one on October 31, the report said.

State media said last week China aims to put an astronaut into space in the next five years and launch more than 30 satellites between 2001 and 2005.

Xinhua quoted an aerospace official as saying the satellite navigation system would provide guidance for the highway, railway and marine sectors.

The system would allow users to pinpoint their exact location with measurements of longitude, latitude and altitude, it said.

Taiwan's defense ministry has said a satellite launched by China early in September might have military applications.

Beijing said that satellite was for territorial surveys, city planning, crop yield assessments and disaster monitoring.

Taiwan closely monitors the space program of its rival China, given Beijing's threats to use force against the island should Taipei move toward independence.

China's Research Institute of Space Technology under the China Space Science and Technology Group developed and built the latest Beidou satellite and its carrier rocket, Xinhua said.

Thursday's launch marks the 64th flight for China's Long March series of rockets and the 22nd consecutive successful launch for the nation's space industry since October 1996, it said.

China had a series of launch mishaps in the mid-1990s but has tried to improve its program, aiming for a slice of the lucrative market for launching commercial satellites.