Beijing police have ordered supermarkets and shopping malls to install high-definition security cameras, as China continues its huge expansion in monitoring technology.

The country has added millions of surveillance cameras over the last five years, part of a broader increase in domestic security spending.

In May, Shanghai announced that a team of 4,000 monitor its surveillance feeds to ensure round-the-clock coverage. The south-western municipality of Chongqing has announced plans to add 200,000 cameras by 2014 because "310,000 digital eyes are not enough".

Urumqi, which saw vicious ethnic violence in 2009, installed 17,000 high-definition, riot-proof cameras last year to ensure "seamless" surveillance. Fast-developing Inner Mongolia plans to have 400,000 units by 2012. In the city of Changsha, the Furong district alone reportedly has 40,000 – one for every 10 inhabitants.

There are cameras on streets and in stores, in university classrooms and outside the doors of dissidents. In March, Beijing roused disquiet in the arts world when it mooted plans to spend 5.57m yuan on cameras to monitor performances in venues such as cinemas and theatres.

China is hardly unique: Britain has arguably led the world in the use of surveillance cameras. But China has embraced them with particular enthusiasm.

IMS Research, an electronics-focused consultancy, has predicted annual growth of more than 20% in China between last year and 2014, and less then 10% elsewhere.

Bo Zhang, senior research analyst at IMS, believes that more than 10m cameras were installed in China in 2010. The company estimates that spending reached $680m last year, with the total market - including related systems - hitting a value of $1.7bn.

Much of that is in the private sector, but Beijing's initiative - targeting theft and food poisoning, say police - shows how officials are increasingly mandating companies to install cameras and link up private networks with official ones.

Authorities are also investing heavily in new public projects. While some areas have gone much further than others, the national Safe City security plan aims to cover urban China with large networks.

Internal security spending has soared to almost 625bn yuan this year, more than the country's official military budget. Monitoring measures range from reinvigorating the neighbourhood committees that watch the comings and goings of residents to tightening internet controls.

China's domestic security chief has also called for the creation of an advanced database covering every citizen to improve "social management". Linked to individuals' identity cards, it would include details such as tax records and educational history.

Nicholas Bequelin, Asia researcher for Human Rights Watch, said: "Whereas surveillance cameras are problematic even in democratic societies, there are important counterweights, such as independent courts, privacy statutes, rules about how long the information can be kept and through what legal procedures it can be accessed, as well as independent media and NGO watchdogs.

"None of these safeguards exist in China, raising the very real prospect of an Orwellian society - one in which citizens are monitored in permanence, including in their private life."

Although much of the imagery may not be watched in real time, it can be stored for later retrieval. Officials are also seeking ways to automate the analysis of data. Using higher quality cameras paves the way for increasingly sophisticated analysis and linking of the information.

Xue Junling, a project manager with Shenzhen Xinghuo Electronic Engineering, says facial recognition was already being used at key points such as big sports stadiums and border checkpoints, although some experts dispute its effectiveness.

Many see nothing wrong with the rapid expansion in surveillance cameras, particularly given official claims for their success in cutting crime. Shanghai police said video monitoring helped them to catch 6,000 suspects last year.

"If the purpose is for the public security of society, personal rights have to give way to public rights," said Prof Fu Dingsheng, of the East China University of Political Science and Law, although he added that better safeguards were needed to ensure systems were not abused.

Others say the expansion of monitoring is intended not just to cut crime but to systematically reduce the space for dissent.

"When dissidents are released from prison or labour camp they often find the surveillance cameras are pointing directing into their homes. That's something I have heard of a lot in the last couple of years," said Wang Songlian, of the Chinese Human Rights Defenders Network.

The artist Ai Weiwei, who was detained for two months this year, produced a marble sculpture titled Surveillance Camera, mimicking the machines posted outside his studio.

The Shanghai rights lawyer Li Tiantian revealed that security officials sought to use footage to increase her isolation during a three-month detention. "They even forced my boyfriend and his brothers and sisters to watch a video that showed me walking into a hotel with other men," she wrote on Twitter.

Wang said state security used cameras to track individuals at sensitive times, but they probably also relied on them for deterrence. "I think the effect is more to intimidate activists - so they feel everything they do is under watch - rather than to gather evidence," she said.