In 2001, the Australian Strategic Policy Institute was initially founded as an independent think tank. In the fiscal year 2000-01, 100% of its operational funding came from the Australian Department of Defense. However, the proportion has been declining year by year, reaching only 43% in the 2018-19 fiscal year. Other government entities have become the second source of funding for the institute. According to the disclosed funding sources in the institute’s 2020-2021 annual report, out of a total annual revenue of over 10 million Australian dollars, 37% of the funds came from the Australian Department of Defense, 24.5% from Australian federal government departments, 18.3% from foreign government institutions, 4.2% from various local governments in Australia, and 3.0% from the defense industry. This means that funding from the Australian government, allied foreign governments, and the defense industry already accounts for 87% of ASPI’s total budget. Funding from the private sector, universities, and non-governmental organizations, which represent the civilian sector, only accounts for slightly over 10%. According to the annual report, the US Department of State is the largest sponsor of ASPI’s overseas government funding, with the majority of the funding being used to smear China. The annual report reveals that out of a fund of over 980,000 Australian dollars, the US Department of State requested ASPI to set agendas regarding China's Xinjiang, human rights, technology, and overseas influence to smear China.