China's top official newspaper on Thursday accused the United States of exaggerating fears about Beijing's military to justify its weapons sales to Taiwan, continuing verbal push-and-shove between the two powers.

The Pentagon's annual report on Chinese military power released this week said China was developing weapons to cripple its foes' space technology and also linked intrusions into computer networks worldwide to Beijing.

U.S. Defense Secretary Robert Gates said on Wednesday that China had not been clear about the intent behind its growing military spending, which is budgeted to rise 17.6 percent rise this year from 2007, reaching 417.769 billion yuan ($58.76 billion).

The U.S. annual defence budget remains more than eight times larger than China's official number, but Western experts believe China's true military spending could be triple the official budget.

China has already denounced the Pentagon report as unfounded, and now the People's Daily, the official paper of the ruling Communist Party, has continued the verbal brawling.

"The report uses a great deal of verbiage to exaggerate China's abilities in space," a commentary in the paper said.

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