Washington: China's military buildup is giving American Army officers sleepless nights, as bolstered by stealth fighters, submarines and an ever stronger navy, China believes it can achieve military parity with the US, a top Senator has said. He also expressed concern over the US' shrinking defence capabilities.

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Congressman Buck McKeon, Chairman of the powerful House Armed Services Committee, said the financial crisis has given China all the more reason to believe it can overtake America, but the US will have to play smart to preserve peace with the merging Asian power.

"China keeps our admirals up at night. And for good reason," said McKeon in his speech at the American Enterprise Institute (AEI), a Washington-based think-tank.

"Any historian worth his salt knows that massive military build-ups and chest-thumping speeches about national destiny is a dangerous combination," he said, referring to a recent Pentagon report on Chinese military buildup.

"The Pentagon report outlined a country that is emboldened with new found military might and drunk with economic power. The Chinese are convinced that they have been given an opening with our current financial crisis," he said.

He said for the first time in history, Beijing believes it can achieve military parity with the United States.

"They are building stealth fighters and submarines. Their navy has grown larger than our own. They are sending warships into territorial waters of our allies," the Congressman said.

"They hack our government computers daily and intimidate our friends in the Pacific rim. I want peace. I pray for peace. But we need to get smart about preserving that peace," he added.

The Congressman said at the same time, America's military had only shrunk.

"Consider the state of the Armed Forces after the end of the Cold War. Our military shrank at a staggering rate. Today, that contraction is accelerating. Admiral Greenert, our incoming Chief of Naval Operations, recently testified that he needed around 400 ships to meet the Navy's broad set of missions," he said.

He said while in 1992, the US had a nearly 550 ship fleet, today it is projected to drop to 250.

He said the number of Army combat brigades since the Cold War had gone down from 76 to 45, fighter squadrons from 82 to 39 while the bomber fleet is so old that some Air Force pilots are flying "the exact same aircraft as their grandfathers". "That's to be expected when the last B-52, the backbone of our bomber fleet, rolled off the assembly line during the Cuban Missile Crisis," McKeon said.

"Over 20 percent of our Navy ships are not ready to sail or fight. 40 percent of that fleet goes to sea and to war with at least one major structural problem.

"We currently have a 367 million dollar bill needed to fix our warships. That number will grow larger," McKeon said.