Fu said the defense figure - which compared with last year's 7.6 percent hike - will account for around 1.3 percent of the country's gross domestic product.
China's 2017 GDP target, which will be unveiled by Premier Li Keqiang on Sunday, is expected to be about 6.5 per cent, according to economists and academics.
China said today that it will increase its defence spending by "around seven per cent" this year, as it vowed to guard against "outside meddling" in its territorial disputes.
Ms Fu dismissed concerns that China posed a threat to the region with its expanding military. This is seen as a second attempt by Chinese president Xi Jinping to capture the moral high ground since his recent announcement at the World Economic Forum that China would stick to the path of globalization despite protectionist tendencies in the US.
Tensions in the South China Sea have been particularly acute in the past three years, as China has built seven artificial islands the US and its allies fear could be used to enforce Beijing's extensive maritime claims in the area.
The country said it has no plans to militarize the islands, but defended its right to build so-called necessary military facilities for defensive purposes.
The increase in China's military expenditure, especially for the navy, is aimed at safeguarding the country's fast expanding overseas interests and is in response to the unstable security situation in the Asia-Pacific region, Chinese military experts were quoted as saying by the state- run Global Times last week.
Barthelemy Courmont, a senior Research Fellow at the Paris-based French Institute for worldwide and Strategic Affairs (IRIS) said it was understandable that a modernising China would seek more advanced armed forces.
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China is spending more on its military each year, but the rate of growth has slowed.
"Look at the past decade or so, there have been so many conflicts, even wars, around the world resulting in serious, large numbers of casualties and loss of property, so many refugees destitute and homeless", she said.
The relatively modest spending increase reflects both China's steady, if not spectacular economic growth, and a security outlook that has changed little in recent years, said Tang Yonghong of the Institute of Taiwan Studies at Xiamen University in southeastern China.
U.S. President Donald Trump will formally submit his first budget to Congress later this month.
According to Fu, China and some ASEAN (Association of Southeast Asian Nations) countries have already returned to dialogue and consultation, and tensions in the South China Sea have shown trends of easing.
Along with defending China's frontiers, the self-governing island of Taiwan remains a military priority for the 2.3 million-member People's Liberation Army, the world's largest standing military. "American actions in the South China Sea have a definite significance in terms of which way the winds blow", she said.
"China will just focus on narrowing the gap between the US' hardware build-up, but not quantity".
Future trends in the region "will depend on United States intentions vis-a-vis the region and United States activities (which) to a certain extent set the barometer for the situation here", Fu said.