Satellite photographs passed to The Daily Telegraph this week showed that the secret base at Sanya on Hainan island will house up to 20 of the latest 094 Jin-class nuclear ballistic submarines that could be capable of firing anti-satellite missiles and nuclear-tipped cruise missiles.
The construction showed that China was “ramping up its operational capability” and developing a “blue water navy” that would challenge the dominance of the US in the Pacific, said Alex Neill, head of the Asia Security Programme at the Royal United Services Institute.
In the last 20 years China had gone from a coastal force to a navy capable of “exerting its influence far afield,” a senior Royal Navy officer said.
“It is clearly looking at a wider area of operations in the Far East but it also does not like the US placing their carrier battle groups in the area. In due course this could lead to Cold War levels of stand off,” the officer said.
There are also concerns that Beijing has secretly developed a broad military strategy – including internet assaults and satellite strikes – that could allow it to take Taiwan with the US unable to respond.
While talks continue for a peaceful settlement the island has long been in Beijing’s sights since it broke from the mainland in 1949.
Kerry Brown, the China expert at the Royal Institute of International Affairs, warned of “hawkish” elements in the two million strong People’s Liberation Army (PLA) who were “very focused” on Taiwan.
”The main source of friction is Taiwan and you cannot rule out a nationalistic military faction coming to power to taking a punt to have a quick go.”
Chinese defence expenditure is estimated by the Pentagon to be $50 billion (£25 billion) but analysts believe large chunks of the budget are “squirreled away” and it could be as high as $200 billion making it the second largest in the world after America.
The PLA is developing a strategy called the “sea denial campaign” which would prevent America intervening in any conflict with Taiwan, Mr Brown said.
It entails asymmetric conflict in which China would use cyber warfare and laser energy to wipe out communications. Anti-satellite missiles, potentially launched from submarines, would ensure that America was “blind” over the Far East. The Chinese have already proven that they have these capabilities as well as using espionage to remove military technology from the US.
”This is what they call pressure point warfare in which they remove any US response in one fell swoop,” Mr Brown said. “China wishes to power project well into the Pacific and challenge the dominance of the US Pacific Command.”
He also said that the Sanya base gave China reach into the Indian Ocean.
Much to America’s disgust, China’s missile accuracy has been improved from 5km down to 1km. China’s own space programme – that some experts believe equals Cape Canaveral in size – is also expanding close to the navy base on Hainan island.
There was no one available at the Chinese Embassy in London to comment.