China's 'military and industrial potential' has been laid bare, outlined in a new think tank report.
Australia's geographic isolation – which has been a major strategic advantage for decades – would not be a future deterrent for the Asian superpower in the event of an Indo-Pacific power play, according to a Lowy Institute report.
"The prospect of Chinese military action against Australia remains remote. But China has the military and industrial potential to field a long-range power projection capacity that would dwarf anything Japan threatened Australia with during the Second World War," the study said.
However, the report also notes Australia's defence interests and territorial integrity are largely unthreatened for now.
China's missile arsenal and its long-range bomber force are the most concerning elements of the country's recent arms build-up, the report said.
Chinese missiles risk a major military power shift in the region.
"Already by far the world's largest, this force continues to grow at a rate that only makes sense for the purpose of severely threatening US and allied capabilities in the western Pacific," the report said.
China's air force would be also greatly enhanced by the development of a new bomber – the H-6N aircraft – that could be refuelled in mid-air.
The aircraft is capable of carrying nuclear weapons and has a flight range of about 9000km, reports say.
China's ability to militarily target mainland Australia from long distances means an invasion would not be necessary to grab control, the Lowy Institute said.
"The sheer ability of the PLA to take such extreme steps places pressure on decision-makers whose actions are weighted with the fear that force might be used against them."
The think-tank said Chinese military operations against Australia was a remote prospect.
"The prospect of Chinese military action against Australia remains remote. But defence policy operates in the realm of low-probability, high-consequence events," the report said.