The agency was created in 1993 when the Ministry of Aerospace Industry was split into CNSA and the China Aerospace Corporation. The former was to be responsible for policy while the latter was responsible for execution. This arrangement proved somewhat unsatisfactory as these two agencies were in affect one large agency, sharing personnel and management.
As part of a massive restructuring in 1998, CASC was split into a number of small state owned companies. The intention appears to have been to create a system similar to Western defense procurement in which a government agency setting policy would contract out to agencies which were government owned but not government managed.