Andrew O'Neil is Professor in the School of Government and International Relations at Griffith University.

The most striking feature of the 2013 Defence White Paper is the growing gap between Australia's strategic policy aspirations and the crunch in defence spending.

Nowhere is this more evident than in the ambitious rhetoric over the strategic construct of the 'Indo-Pacific', where Australia's grand plans to play an active role in promoting a stable environment coexist uncomfortably with the fact that defence expenditure as a proportion of GDP is at its lowest point since 1938. Like the Australia in the Asian Century White Paper, DWP 2013 paints a grandiose picture of Australia's regional ambitions, but fails to deliver on the means to achieve it.

Of equal concern is the tone of the White Paper and surrounding commentary concerning China. A lot has been made of the more 'balanced' rhetoric in the latest DWP compared with what many characterised as the confrontational rhetoric of the 2009 version.

But what did the earlier document actually say about China? It said, in very measured terms, that 'the scope and structure of China's military modernisation have the potential to give its neighbours cause for concern if not carefully explained, and if China does not reach out to others to build confidence regarding its military plans'. DWP 2009 further observed that if China was not more transparent, 'there is likely to be a question in the minds of regional states about the long term strategic purpose of its forces'.

These statements were analytically correct and reflected concerns already expressed by other Asian countries. Australia was not the first to point out the opaque nature of China's strategic modernisation program and the potentially destabilising impact of this opacity on Asia's regional security landscape.

China's furious response, which included high profile public condemnation and the private haranguing of senior Australian officials, said more about Beijing's acute sensitivity to criticism than it did about the merits or otherwise of what was said in DWP 2009. It also occurred at a time when then-Prime Minister Rudd had made some fairly direct observations about China's human rights performance. The response from some high level Chinese officials included references to Australia 'suffering consequences' as a result of its actions, the sort of rhetoric one expects to hear from a parent admonishing a small child for its behaviour rather than one state treating another with respect.

It's clear that China is more pleased with the current government's deferential approach as distinct from the more refractory Rudd Government. The omission of any reference in DWP 2013 to continuing regional concerns over China's strategic transparency deficit received a quick tick of approval from the Chinese Foreign Ministry. This came hot on the heels of Beijing's blessing of Australia as a 'strategic partner' during Prime Minister Gillard's recent state visit, a status that had been highly coveted by Australian officials. This sequence of events can hardly be said to be coincidental.

There are at least two points to make. The first is that there is no reason why Australia can't have a balanced relationship with China while at the same engaging in measured observations about how China conducts itself as Asia's most significant great power. Despite heated threats of 'consequences', Beijing and Australia need each other economically and the Rudd period did not witness any diminution of the strong trade and investment relations between the two countries (one of Rudd's final acts as PM was to sign a record $10 billion worth of resource-related contracts between Chinese and Australian firms).

The second point is that Australia must exercise caution that it does not fall into the trap of feeling it needs to pander to China's exaggerated sensitivity to criticism in order to safeguard the bilateral relationship. Chinese elites understandably feel they are entitled to a degree of deference from secondary powers like Australia and tend to be affronted when this doesn't materialise. This is central to understanding Beijing's incandescent response to DWP 2009. Australian officials would do well avoid a situation where they feel obliged to reassure rising great powers that a continuing lack of transparency on core strategic issues in our region is acceptable.

Photo courtesy of the Defence Department.