The US-Taiwan Business Council has invited Defense Minister Lee Jye to participate in the bilateral meeting slated for October 3-5, the third of its kind between the two, the China Times said.

But it quoted an unnamed military officer as saying "at this moment, Lee has not yet decided to attend or not because he may have to stay here to defend the special military budget while it is screened by the Legislative Yuan."

If that happens, Deputy Defense Minister Huo Sho-yeh would instead attend and meet his US counterpart Deputy Defense Secretary Paul Wolfowitz, it said.

Taiwan's defense ministry declined to comment on the report.

There have been mounting objections to the controversial special budget of 610 billion Taiwan dollars (18.2 billion US) which is pending parliament's final approval.

The budget is for the purchase of eight conventional submarines, modified Patriot anti-missile systems and anti-submarine aircraft over a 15-year period from 2005.

Some critics say Taiwan cannot afford the massive spending spree, while others say the new weaponry will not be delivered in time to help the island fend off a possible attack from China in coming years.

Observers expected the planned US trip to invite loud protests from China as Beijing would see it a further sign of closer military ties with the island.

Chinese Foreign Minister Li Zhaoxing on Friday said the US must halt military exchanges and arms sales to Taiwan, given the "seriousness" of the cross-strait standoff.

The United States has remained the leading arms supplier to Taiwan despite switching diplomatic recognition from Taipei to Beijing in 1979.

Separately, the Taiwanese defense ministry confirmed Chinese troops have launched massive wargames on Dongshan Island, 150 nautical miles west of Taiwan.

Taiwan's army held a live-fire cannon drill on fortified Kinmen island off the southeast Chinese province of Fujian, but defense ministry spokesman Huang Suey-sheng said it was "routine".

A string of wargames have been staged separately by Taiwan and China over the past few weeks, prompting the United States to call for restraint from the two sides fearing unexpected clashes might lead to war.

Since pro-independence President Chen Shui-bian was re-elected in March, Beijing has stressed its long-standing vow to take Taiwan by force should the island try to declare formal independence.

The two sides split in 1949 after a civil war.

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