If Australian navy ships ventured within cooee of Chinese-claimed territory in the South China Sea it could spell "great trouble".
That's the response of analysts at an international studies group linked to the Chinese foreign ministry to suggestions Australia carry out a freedom-of-navigation exercise within a 12 nautical mile territorial limit.
One Chinese People's Institute of Foreign Affairs analyst said the nations' strategic partnership could be "severely damaged".
The analysts would not be drawn specifically on the "many ways" China could react or the prospect of economic consequences or symbolic ones, such as the withdrawal of Beijing's ambassador in Canberra.
China claims virtually all of the South China Sea and inflamed regional tensions when it started building artificial islands on disputed reefs, adding airstrips, radar, communications and defence systems.
The Chinese Foreign Ministry has previously viewed US exercises within the 12 nautical mile navigation limit as "provocative".
The Australian government is wary of such exercises escalating tensions but supports the concept of free navigation in the busy shipping route.
Asked about the implications of such exercises, a Chinese Ministry of Commerce official denied there were any issues with freedom of navigation in the South China Sea.
"Do you see any questions over freedom of navigation in that area right now?" he told reporters in Beijing.
"Have you seen any ships that wish to do freedom of navigation but can't? If not why practise that?"
China has rejected a recent Permanent Court of Arbitration ruling it has no historic title over the South China Sea.
It insists this is sovereign territory and the 12 nautical mile territorial limit applies.
Brunei, Malaysia, the Philippines, Taiwan and Vietnam also claim parts of the South China Sea.
It's hoped a recent Association of South East Asian Nations agreement to set up a hotline between governments to address maritime encounters at sea will be a significant step toward resolving the issues.
*The reporter travelled to China on a delegation hosted by the Chinese People's Institute of Foreign Affairs.
