WASHINGTON - The US Department of Defense on Wednesday unveiled its annual report on China's military, recognizing and welcoming China's contribution to international safety and security, while still overlooking the country's peaceful defense policy.

The report, titled Military and Security Developments Involving the People's Republic of China, recognized that China has made "modest, but incremental, improvements in the transparency of its military and security affairs," while alleging "uncertainty about how China will use its growing capabilities."

China has repeatedly stated the defensive nature of the country's national defense policy, issuing a white paper on national defense in March to enhance its military's transparency and boost the world's trust in its commitment to peaceful development.

The Pentagon report also noted China's investment in modern military hardware and technology, including in its naval forces, as the country started its sea trials on a refitted aircraft carrier.

China is the last to possess an aircraft carrier platform among the five permanent members of the United Nations Security Council.

The report said China is developing anti-ship missiles that could target aircraft carriers while expanding the naval fleet. It said many modern systems have reached maturity and others will become operational in the next few years.

"Following this period of ambitious acquisition, the decade from 2011 through 2020 will prove critical to the PLA (People's Liberation Army) as it attempts to integrated many new and complex platforms."

The 94-page report, as usual, interferes with the internal issue of China by making willful comments on the situation across Taiwan Straits.

It said Taiwan remains PLA's "main strategic direction," and that PLA's modernization is focused on Taiwan contingencies even as cross-Strait relations improved.

The Pentagon report, submitted to the Congress by the Pentagon annually pursuant to a US law since 2000, has drawn protest from China over its interfering nature, distortion of facts and baseless speculations.

This year's report, however, said the United States recognizes China's contributions that support a safe and secure global environment. It says strengthening the military-to-military relationship is critical "as we seek to capitalize on opportunities for cooperation while mitigating risks."

The past year has seen improved military-to-military relationship between the two countries. Mike Mullen, the chairman of the US Joint Chiefs of Staff, has visited China, while his Chinese counterpart, Chen Bingde, has visited the United States. Mullen has said he was "encouraged" on recent military-to-military exchanges with China, noting it lays a basis for further dialogue.