China under-reports defence spending, says US

The US said China was modernising drones, warships and cyber weapons

China has under-reported its 2014 defence spending by about 20%, according to an annual report put out by the US defence department.

China's stated budget for this year was $120bn (£70bn), but the US report said the actual figure was closer to $145bn.

The US called on China to be more open about its plans, amid high tension with other regional powers over disputed islands in the South China Sea.

China often accused the US of hypocrisy as their budget dwarfs Beijing's.

The American military budget was about $600bn in 2013.

The annual US report on China's defences usually gives a rough estimate of spending, with last year's quoting a figure of between $135bn and $215bn.

But officials say this year they have a much better understanding of the way China operates.

The Pentagon said Beijing was spending money on upgrading its arsenal of drones, warships, jets, missiles and cyber weapons.

Beijing's main focus, it said, was still on a potential confrontation in the Taiwan Strait.

But it was also increasingly focusing on the territorial disputes in the South and East China Seas.

China claims islands and rocky outcrops throughout the seas that are also claimed by countries including the Philippines, Vietnam and Japan.

The US said China's lack of openness caused serious concern for other nations in the region.

"Absent greater transparency from China and a change in its behaviour, these concerns will likely intensify as [Chinese] military modernisation programme progresses," the report said.

Beijing has not so far responded to the criticism.