China's weekend scrap with a U.S. Navy surveillance ship is drawing attention to a new submarine base that Beijing is using to strengthen its presence on the strategically vital South China Sea, which it claims as a whole.

For the second day running, the Foreign Ministry in Beijing fired back Wednesday at U.S. complaints over what the Pentagon called harassment of the U.S. Navy mapping ship by Chinese boats in international waters about 75 miles off its southern island province of Hainan.

U.S. claims that the USNS Impeccable was operating legally within China's exclusive economic zone when it was harassed by Chinese boats are "gravely in contravention of the facts and unacceptable to China," spokesman Ma Zhaoxu said in a statement posted on the ministry's Web site.

Ma's comments, a virtual repeat of those made at a news conference Tuesday, showed neither side was prepared to back down, even as they prepare for a much-anticipated first meeting between Hu and President Barack Obama at next month's G20 summit in London.

Chinese Foreign Minister Yang Jiechi and U.S. Secretary of State Hillary Rodham Clinton didn't mention the dispute before they went into a private meeting Wednesday in Washington. But State Department spokesman Robert Wood told reporters it very likely would come up in the meeting.

Defense Department officials say the Impeccable was on a mission to seek out threats such as submarines and was towing a sonar apparatus that scans and listens for subs, mines and torpedoes. With its numerous Chinese military installations, Hainan offers rich hunting for such surveillance.

Of particular interest is the new submarine base near the resort city of Sanya that is home to the Chinese navy's most sophisticated craft.

Photographs of the base taken last year and posted on the Internet by the Federation of American Scientists show a submarine cave entrance and a pier, with a Chinese nuclear-powered Jin class sub docked there.

While little else is known, its location on the South China Sea offers the People's Liberation Army Navy access to crucial waterways through which much of the shipping bound for Japan and Northeast Asia must travel.

High-seas encounters such as the Impeccable incident are likely to grow more common because China wants to assert its right to protect its secrets in the area, while the U.S. wants to gain as much knowledge as possible about China's subs and the underwater terrain, according to maritime policy analyst Mark Valencia.

"Thus such incidents are likely to be repeated and become more dangerous and they do not pertain to China and the U.S. alone," Valencia wrote in an article posted Wednesday on the Web site of the Far Eastern Economic Review.

China's claim to the entire South China Sea and its hundreds of islands and reefs overlaps with those of a half-dozen other nations, leading to occasional clashes and standoffs. Increasingly, China's rapid naval upgrade, exemplified by the Hainan base, is putting muscle behind its arguments.

From Russia, China has purchased a dozen Kilo-class diesel submarines, Sovremmenny class destroyers and supersonic Sunburn and Sizzler anti-ship missiles. China's own advanced Shang, Song and Yuan class submarines are being produced at a rapid tick, and there is increasing talk of an aircraft carrier being launched in coming years.

President and Communist Party leader Hu Jintao, who also heads the commissions overseeing the armed forces, called on the military Wednesday to pick up the pace of modernization to "resolutely safeguard the country's sovereignty, security and territorial integrity."

China's territorial claims are sharpened still more by Beijing's interpretation of the United Nations Convention on the Law of the Sea. China sees the convention as giving it the right to ban a broad range of activities within its exclusive economic zone. That grates against the U.S. position that the Navy ships were in international waters and therefore have the right to conduct surveying.

Those dueling claims also lay at the heart of the last major confrontation between the two militaries, a 2001 mid-air collision between a Chinese fighter jet and a U.S. spy plane in international air space south of Hainan.

This time, Beijing appears to be pressing its stance even harder, citing both the U.N. convention and its own domestic laws and regulations.

"The Chinese government always handles such activities strictly in accordance with these laws and regulations," the Foreign Ministry's Ma said in his statement.