U.S. State Department has approved the possible sale to Taiwan of a pilot training program and maintenance and logistics support for F-16 aircraft currently at Luke Air Force Base in Arizona at an estimated cost of $500 million, the Pentagon said on Monday.

“The proposed sale of this equipment and support will not alter the basic military balance in the region,” the Pentagon’s Defense Security Cooperation Agency said in a statement.

A unit of L3 Technologies Inc is among the prime contractors, the statement said.

U.S. military sales to self-ruled Taiwan, which China claims as its territory, is an irritant in the relations between the world’s two largest economies. Taiwan would still need to finalize details of the sale with U.S. companies.

(Reporting by Mohammad Zargham; Editing by Eric Beech)