The taxi driver from northern China was contacted by a man claiming to work for a foreign company after he put a post online looking for work in July 2013, Hong Kong based South China Morning Post reported.
The cabbie, who was identified as Duan, was offered money to collect information on a military unit in Kaifeng and paid 300 yuan (USD 50) for his first assignment of taking note of the vehicles coming in and out of the base.
He was paid over 40,000 yuan (over USD 6,600) before he was caught by the state security department late last year, the report said.
The foreign intelligence agency was not named in the report.
Henan has become a target for overseas spy agencies because several military units are garrisoned in the province and defence-related science and technology industries have bases there, it said.
"In the beginning, I thought he was only asking for something which most Kaifeng residents knew, but as he asked for more details I felt something was wrong," the taxi driver was quoted as saying during his interrogation.