kwaigonegin
Colonel
No direct indication it receives military funding. But since SAC is a government owned company, the project has to be government funded, anyway. Since it has no military R&D funding, the explanation that it is purely for export makes sense. However, it has to be discussed with the military, to gain permission for export, so there has to be considerable military involvement. It is possible the underlying suppliers were military funded, and there could be military technology transfer or other sorts of support (such as the first prototype went to Yan Liang before to use the government facility for testing). So, we can only conclude "China" should be considered as one entity in terms of industrial military complex.
SAC along can't invest in all the parts, such as the new radar and the new engine, without extensive military (indirect) funding. The fact that the second prototype exists, means it is agreed upon in the higher-ups for some customers, domestic or not.
Im glad you said it kuru and I'm frankly quite surprised so many is unaware that CAC, SAC etc are not total privately held companies like Boeing, Lockheed etc. Heck, I guarantee you even privately owned companies like them have received certain funding that are not disclosed to the general public.
Anyway AVIC itself is a state owned enterprise and under the directive of SASAC..
Like you said the fact that FC31 even came to being and has two actual flying copies means that the state has invested considerable amount into it. Anyone claiming it has received zero gov. funding is either lying or wholly ignorant of how these companies work.