New Delhi: Expressing concern over Chinese military infrastructure buildup, Defence Minister AK Antony on Tuesday said India was working to match it to protect the country's territory and build an effective deterrence.

"China is expanding its military capabilities and their infrastructure in the border area is also increasing substantially and we are concerned about that," he said.

The Minister made these remarks when asked about India's response to Chinese military modernization in the Eastern and Northern sectors.

"We have been improving our infrastructure and military capabilities in the eastern sector. We are strengthening our military capability and infrastructure not for confrontation, but to protect our territory and also to build an effective that we can protect every inch of Indian Territory," Antony said.

India has been deploying its frontline fighter aircraft Sukhoi-30 MKIs on its airbases along the Chinese border in the North-East and has raised two Mountain Divisions there.

Ultra light howitzers and tanks under new armoured formations are also planned to be deployed in the region. Asked about the existing defence ties with China, Antony said the Defence Secretary-level talks between the two sides will be held next year.

"Defence exchanges with China are again resuming. I hope the defence dialogue (between the two nations) at the Defence Secretary-level will again resume next years," Antony told reporters here on the sidelines of Fifth South Asia Conference here.

India and China will hold the Annual Defence Dialogue (ADD) in January next year during which the two sides are expected to discuss resumption of their joint Army exercise and the pending border issues between them.

Replying to queries on improving defence exchanges with China, he said, "That discussions including the one on border management are going on. India and China agreed to set up a new mechanism (for border management) and that mechanism may also take place very soon, may be towards the end of this year."

After a freeze in defence ties over denial of visa to the then Northern Army Commander last year, India resumed defence exchanges with China by sending a military delegation headed by a Major General in June this year.

Earlier this month, China also sent a delegation headed by a Lieutenant General to visit Defence installations in Delhi, Kolkata and Mumbai.

To a query on China establishing diplomatic relations with Maldives, Antony said, "How can you prevent any country from establishing an embassy or furthering relations with any other country in the world."

Terming it as a natural process to establish relations with other countries, he said, "We are also establishing embassies and building relations with every country. It is a natural process."

Expanding its presence in the Indian Ocean region, China recently opened its embassy in Maldives and sought an observer status in the SAARC grouping.

So far only India, Sri Lanka, Pakistan and Bangladesh have an established diplomatic presence in the Maldives.

No one should expect 'miracle' in Indo-Pak ties

Terming the recent thaw in India-Pakistan relations as a "positive sign" and a "good breakthrough", Defence Minister A K Antony on Tuesday said one should not expect a "miracle" out of it.

"At the moment we find positive signs in relations with Pakistan in areas of economic cooperation. There is a real breakthrough, its a beginning," he told reporters here on the sidelines of Fifth South Asia Conference.

"There are positive signs for a breakthrough but one should not expect a miracle out of it," he said.

On the scope of expanding ties with Pakistan, he said, "The recent discussion of our Prime Minister had with his Pakistani counterpart during the SAARC summit had some positive signals."

Pakistan had recently announced that it would grant India the status of Most Favored Nation (MFN) to better trade ties between the two neighbours. India had granted MFN status to Pakistan in 1996, but Islamabad had been reluctant on various grounds to reciprocate.

During the recently held SAARC summit in Maldives, the two sides agreed to push a host of initiatives, including the revival of the joint commission, a preferential trade agreement and liberal visa regime.

Antony told the Conference that there was need for collective and innovative measures to counter the menace of terrorism.

"Terrorism continues to be a menace for civilised nations and societies the world over. Increasingly, non-state actors with cross-national linkages pose critical challenges. Nations need to draw up collective and innovative measures to effectively counter such evil designs," he said. Holding that "only alternative to cooperation is to perish", Antony said, "We pay special attention to defence cooperation by increasing the frequency of defence exchanges with defence forces from a large number of friendly countries."

India, he said, has recently signed strategic partnership agreements with Afghanistan and other neighbouring countries.

"India signed a Strategic Partnership Agreement with Afghanistan. Similarly, a Framework Cooperation Agreement has been drawn up with Bangladesh. Our relations with Bhutan, Maldives, Myanmar, Nepal and Sri Lanka have been strengthened through exchange of high level visits and expansion of cooperation," he added.