By Ben Blanchard and Liz Lee
TAIPEI/BEIJING (Reuters) -Taiwan is keeping watch on a Chinese aircraft carrier but does not expect a large escalation in tensions, the government said on Thursday, after China denounced a meeting between Taiwan President Tsai Ing-wen and U.S. House Speaker Kevin McCarthy.
McCarthy - the third highest ranking official in the U.S. leadership hierarchy - and other Republican and Democratic lawmakers met Tsai on Wednesday at the Ronald Reagan Presidential Library in Simi Valley, California.
The meeting took place at a low ebb in U.S.-China relations and despite threats of retaliation from Beijing, which claims democratically governed Taiwan as its own and has never renounced the use of force to bring it under Chinese control.
The Chinese carrier, the Shandong, was spotted on Wednesday and was currently 200 nautical miles (370 km) off Taiwan's east cost, Taiwan Defence Minister Chiu Kuo-cheng told reporters at parliament in Taipei.
"It is training but the timing is quite sensitive, and what it is up to we are still studying," Chiu said, adding that aircraft had yet to be seen taking off from its deck.
He later told lawmakers the ship was east of the very southern tip of Taiwan, and Taiwanese warships were monitoring it at a distance of five to six nautical miles.
Japan's defence ministry said the Chinese group was made up of three vessels, including a frigate and a support ship, and a Japanese warship was monitoring the group.
It said this was the first time Japan had seen the Shandong, commissioned in 2019, enter the Pacific.
China's Foreign Ministry declined comment on the carrier and what it was up to.
China has sailed its aircraft carriers close to Taiwan before and at similarly sensitive times.
In March of last year, the Shandong sailed through the Taiwan Strait, just hours before the Chinese and U.S. presidents were due to talk.
The U.S. aircraft carrier the USS Nimitz is also some 400 nautical miles east of Taiwan, Chiu said.
"It can't be said it's here for us, but as soon as this situation happened - it's all related," he added.
The U.S. Navy declined to comment, adding it "will not speculate on future operations of the USS Nimitz".
China staged war games around Taiwan last August after then-House Speaker Nancy Pelosi visited Taipei.
The latest U.S. lawmaker delegation to Taiwan, led by Michael McCaul, chairman of the U.S. House Foreign Affairs Committee, arrived in Taipei on Thursday.
Tsai, due to return to Taipei on Friday, will meet McCaul's delegation on Saturday, her office said.
CHINA COMPLAINS
While Chinese state media condemned the meeting in California - state television said in a commentary that those who seek Taiwan's independence will "have their bodies smashed to pieces and bones ground to powder" - China's Defence Ministry did not threaten specific retaliatory action.
"The Chinese People's Liberation Army adheres to its duties and missions, maintains a high degree of alert at all times, resolutely defends national sovereignty and territorial integrity, and resolutely maintains peace and stability in the Taiwan Strait," it said in a statement.
Ko Cheng-heng, deputy head of Taiwan's National Security Bureau, told lawmakers on Thursday they did not expect such a strong reaction from China as followed Pelosi's trip.
"What the Chinese communists care more about is whether McCarthy will visit Taiwan," he said.
China is also trying to show a more diplomatic face to the world, Ko said, noting French President Emmanuel Macron and European Commission President Ursula von der Leyen are currently in Beijing.
"So at the moment they are continuing to put on a more peaceful, great power image."
Taiwan is also concerned about China's announcement late Wednesday that its maritime safety administration is to inspect ships in the Taiwan Strait, including possibly boarding them.
Taiwan has told shipping operators that if they encounter such requests from China they should refuse them and immediately notify Taiwan's coast guard to render assistance.
Defence Minister Chiu said Taiwan will react if Chinese patrol ships cross the Taiwan Strait's median line, which normally serves as an unofficial barrier between the two sides.
China says the Taiwan Strait is its sovereign territory.
"It was China that unilaterally announced its jurisdiction over that sea, and we do not agree with this," Chiu said.
However, he said the ship China has sent to lead the inspections, the Haixun 6, is currently in waters close to the Chinese coast. Ko added he was not aware of recent cases of China boarding Taiwanese ships to inspect them.
Taiwan's stock market largely brushed off the latest tensions, with the benchmark index closing down 0.4% on Thursday.