China needs security to develop and must modernize its military to make it a "Great Wall of Steel," President Xi Jinping said on Monday, amid mounting tensions with the United States.

Speaking for the first time in his precedent-breaking third term as head of state, Xi called for China to step up its ability to safeguard national security and manage public security.

"Security is the foundation for development, stability is the prerequisite for prosperity," he said at the closing of the annual parliament session.