By Rachel Armstrong and Raju Gopalakrishnan
SINGAPORE, June 1 (Reuters) - When Japan's defense minister greeted the deputy chief of staff of China's army at a regional security forum this weekend, he was undiplomatically snubbed.
Lieutenant General Wang Guanzhong said he was incensed by comments from Japananese Prime Minister Shinzo Abe implicitly holding China responsible for territorial disputes in the East and South China Seas and later by U.S. Defense Secretary Chuck Hagel's accusations that Beijing was destabilizing the region.
"When Mr Abe spoke just now, there was veiled criticism targeted at China," Wang told Japanese Defense Minister Itsunori Onodera, according to the semi-official China News Service. "These accusations are wrong and go against the standards of international relations."
The exchange between the world's three biggest economies at the Shangri-La Dialog in Singapore, a security forum for government officials, military officers and defense experts, were among the most caustic in years at diplomatic gatherings, and could be a setback to efforts to bring ties back on track.
It was the first such major conference since tensions have surged in the South China Sea, one of Asia's most intractable disputes and a possible flashpoint for conflict.
Tellingly, despite around 100 bilateral and trilateral meetings taking place over the week, officials from China and Japan did not sit down together.
China's Wang had rejected an offer of talks with Japan and said: "This will hinge on whether the Japanese side is willing to amend the erroneous policy towards China and improve relations between China and Japan. Japan should correct its mistakes as soon as possible to improve China-Japan ties."
Wang later accused the United States of hegemonism, threats and intimidation.
China claims almost the entire oil- and gas-rich South China Sea, and dismisses competing claims from Taiwan, Brunei, Vietnam, the Philippines and Malaysia. Japan has its own territorial row with China over islands in the East China Sea.
Riots broke out in Vietnam last month after China placed an oil rig in waters claimed by Hanoi, and the Philippines said Beijing could be building an airstrip on a disputed island.
Tensions have been rising steadily in the East China Sea as well. Japan's defense ministry said Chinese SU-27 fighters came as close as 50 meters (170 ft) to a Japanese OP-3C surveillance plane near disputed islets last week and within 30 meters of a YS-11EB electronic intelligence aircraft.
On Sunday, Wang stepped up the rhetoric.
"Mr Abe, as the head of a country and as someone the organizers have invited to give a speech, is supposed to stick to the event's aim in boosting security in the Asia Pacific region," he said. "However Mr Abe went against the aim of the event by instigating disputes."
Despite the heated words, analysts do not believe relations have deteriorated beyond reach.
"In the past, there was a sense we were sailing towards stability," said Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore.
"Now people worry. Overall, things are going in the right direction. Nobody thinks there will be war, but there is a level of unease which is new."
JAPAN'S COMING OUT
China has been particularly aggrieved by Japan trying to woo Southeast Asia.
In his keynote address to the conference, Abe pitched his plan for Japan to take on a bigger international security role and said Tokyo would offer its "utmost support" to Southeast Asian countries in their efforts to protect their seas and airspace. It is part of his nationalist agenda to loosen the restraints of the pacifist post World War Two constitution and to shape a more muscular Japanese foreign policy.
Philip Hammond, the British defense minister, said Abe's agenda was well know but provoked a response because it was laid out publicly.
"It's certainly the first time I had heard him articulate it on a public platform in that way," he said.
Japan's growing proximity to Washington is also a worry for Beijing.
"What really worries them is that Japan and the U.S. are in a very strong alliance and seem to be pulling closer, that was clear at this year's dialog," said Tim Huxley, executive director of the International Institute of Strategic Studies in Asia, the organizer of the forum.
"Rightly or wrongly, that will be seen by the Chinese as threatening them because it will mean they will be facing a more coherent alliance."
Still, the row is not likely to spill over. The three nations have deep economic and business ties, which none of them would like to see disrupted.
"Relations are definitely not at a breaking point," said Bonnie Glaser of the Washington-based Center for Strategic and International Studies and a regular visitor to the dialog.
"Leaders are aware that their countries have huge stakes in this relationship and they are committed to trying to find areas where interests do overlap, where they can work together."
Beijing, she said, had compartmentalized various aspects of its relationship with Japan and the United States. "There is a wider strategy from China, though we don't see that here, partly because it's a security forum."
William Cohen, a former U.S. secretary for defense, said the strong words from the United States and Japan were necessary.
"China is growing, it's maturing, it's also feeling its oats a bit and throwing its weight around. That is normal if they see no counterweight. It's incumbent upon us to say, okay, there are limits. These things have to be said." (Additional reporting by Chyen Yee Lee; Editing by Alex Richardson)
By Rachel Armstrong and Raju Gopalakrishnan