Northwest China's Xinjiang Uyghur Autonomous Region will set up a city to fight separatism, stabilize the border and promote economic development, the 14th division of the Xinjiang Production and Construction Corps (XPCC) confirmed with the Global Times on Thursday.

The State Council has approved the plan to set up county-level city Kunyu administered by the 14th division of the XPCC, several employees of the division in Hotan prefecture told the Global Times, without further discussing the plan.

Kunyu is 75 kilometers from Hotan in southern Xinjiang's Hotan prefecture inhabited by people belonging to the Uyghur ethnic minority and also a hotbed for terrorism, separatism and extremism, the XPCC website said.

Establishing the city of Kunyu secures the border area, preserves national security and develops the economy, according to an article released on the  official website of XPCC in 2015.

The 14th division is responsible for cracking down on terrorism, separatism and extremism in Xinjiang. Fighting separatism in Hotan is serious and complicated, according to the website.

Kunyu's strategic position is significant since it is also located 440 kilometers away from Kashgar, which borders India, Pakistan and Afghanistan, the website said.

In August 2014, the Xinhua News Agency reported that 37 civilians were killed and another 13 injured in a terrorist attack in Shache county, Kashgar prefecture.

As an important component of the autonomous region, the XPCC is a special social organization that handles its own administrative and judicial affairs within the reclamation areas under its administration, consistent with the laws and regulations of the state and the region, said Xinhua.

Since it was formed 60 years ago, the XPCC has reclaimed ecological oases from the desolate Gobi desert, launched Xinjiang's modernization, built large-scale agriculture, industrial and mining enterprises, and established new cities and towns with the help of residents from all ethnic groups.