At first blush, Thursday’s opening of China’s National People’s Congress (NPC) looked ominous for Taiwan. Taking the podium in Beijing’s cavernous Great Hall of the People, Premier Li Qiang unveiled a 7% bump on defense spending while using strident language for the self-ruling island, over which China claims dominion.

While vowing the People’s Liberation Army (PLA) would “accelerate the development of advanced combat capabilities,” Li said China would “resolutely crack down on separatist activities” in Taiwan, a noted upgrade on last year’s promise to simply “oppose” them.

Given U.S. President Donald Trump’s ongoing war with Iran has depleted stocks of sophisticated weapons systems vital to defend the island, nerves were already jangling in Taiwan—as well as Ukraine, and, indeed, Washington. Questions about U.S. weapons reserves were raised during a closed-door briefing between senior Trump Administration officials and members of Congress on Tuesday, sources told TIME.

With the U.S. military depleted and distracted by a conflict on the other side of the globe, observers worried that Chinese strongman Xi Jinping may never have a better opportunity to move on the democratic island of 23 million, whose “reunification” he has called “the great trend of history.” The fear is that Trump’s transactional bearing and embrace of a “might is right” doctrine—both in his own actions and his ambivalence regarding Russia’s invasion of Ukraine—could be interpreted as a green light by Xi.

“Will Xi be tempted to take advantage of U.S. potentially exhausting smart munitions and attack Taiwan even if the PLA is not fully ready?” asks Prof. Steve Tsang, director of the SOAS China Institute at the University of London. “Possible.”

However, other indicators point in the opposite direction: that the U.S. assault on Iran has in fact secured Taiwan’s de facto independence—in the short-term, at least. While American officials have offered dubious and contradictory rationales for war, and what will eventually arise from the rubble is anything but clear, there’s no denying that, operationally at least, the U.S. strikes have been a stunning success.

In the first four days of the conflict, the U.S attacked close to 2,000 targets, including 16 ships—sinking an Iranian frigate some 2,000 mi from Iran near Sri Lanka—as well as a submarine. Moreover, its successful decapitation strikes against Ayatollah Ali Khamenei and his chief acolytes—following the daring capture of Venezuelan despot Nicolás Maduro—indicates a prowess of intelligence and wherewithal that contrasts with a PLA that hasn’t fought a major war for almost half-a-century (and it lost that one).

“The specter of a decapitation strike has been proven a more realistic scenario,” says Wen-ti Sung, a political scientist based in Taiwan for the Australian National University. “China’s first reaction will be: ‘This could happen here.’”

Another factor is the suspect performance of China’s own military equipment in Iran, which had reportedly purchased kamikaze drones and air-defense capabilities from Beijing. Moreover, Iran was negotiating to buy Chinese advanced anti-ship missiles, though it’s unclear whether these had been installed. Beijing’s best hope of saving face is that they were not yet operational. If they were, that is even more damning—not least after the advanced Chinese radar and anti-aircraft systems purchased by Venezuela failed to detect the U.S. stealth jets they were supposed to.

“China will be looking to learn from the failings of their own equipment in both Venezuela and Iran,” says Chong Ja Ian, professor of international relations at the National University of Singapore. “And I think they are somewhat surprised by the demonstration of U.S. force and its ability to execute pretty complex operations.”

Then there are the effects of the Iran war itself. On a purely diplomatic level, China has been humbled. For decades, that Iranian proxies had targeted American allies with relative impunity had been a source of schadenfreude for Beijing. But that the world’s No. 2 economy—which reveled in its peacemaking role after brokering the reestablishment of diplomatic ties between Tehran and Riyadh in 2023—has been reduced to issuing glib condemnations and dispatching “peace envoys” to the region spotlights Beijing’s true impotence. China is “proving to be a feckless friend for its authoritarian allies,” Nicholas Burns, the U.S. ambassador to China under President Joe Biden, wrote on X.

Economically, China also suffers. China was the top purchaser of both Venezuelan and Iranian oil, accounting for 4% and 13% of imports respectively. But more broadly, half of China’s oil and almost a third of its liquefied natural gas comes from the Middle East, which is suffering widespread disruption especially in the Iranian-blockaded Strait of Hormuz. Beijing has significant oil reserves and is transitioning to green alternatives, though the clear message is that its near-term energy needs are acutely vulnerable to U.S. action.

Besides, Chinese designs on Taiwan hinge on the U.S. not getting involved. And while Trump’s foreign policy has been schizophrenic to say the least—and alienating to his MAGA base—Washington’s latest National Defense Strategy clearly states the U.S. will “erect a strong denial defense along the First Island Chain,” which includes Taiwan. “My sense is Xi assumes America would come to Taiwan’s defense and thus won’t attack anytime soon,” says Sean King, senior vice president focusing on Asia for consulting firm Park Strategies. 

Indeed, while Li’s Work Report does take a hawkish tone regarding Taiwan, there are caveats. The 7% defense budget bump is far greater than the GDP target of 4.5-5%—the lowest GDP target in decades—though notably less than the 7.2% defense budget of the previous three years. The PLA is also in the midst of a purge unprecedented since Mao’s era, with the NPC removing nine military officials including several high-ranking generals from the PLA deputy list. Regarding anti-corruption efforts, Li said the “political rectification” of the military will “continue to deepen” to “uphold the Communist Party’s absolute leadership over the people’s armed forces.” That the military purge is ongoing raises serious questions about the PLA’s command structure and combat readiness for any Taiwan contingency.

Moreover, last year Li spoke of “improving” China’s Taiwan policy framework, but this time he talked about “deepening” it, indicating things are already largely on the right track. The inference is that “Beijing only needs to ‘do more,’ rather than ‘do things differently,’ on Taiwan,” says Sung.

This is largely because Taiwan’s ruling China-skeptic Democratic Progressive Party (DDP) is all at sea, with low approval ratings, a deadlocked legislature, political infighting, and a failed recall campaign that aimed to unseat lawmakers for the pro-Beijing opposition Nationalist Party, or KMT. These doldrums have spurred a revival for the KMT, which seeks security in closer ties with Beijing. And the KMT’s message is gaining credence precisely because of the mercurial nature of the Trump Administration, as spotlighted by the Iran war, which has cast grave doubt on U.S. security guarantees.

Indeed, Taiwan only featured towards the end of Li’s Work Report, as is typical. The overall focus was overwhelmingly on fixing China’s floundering economy, with action to tackle unemployment, a depressed real estate market, and boosting innovation.