"I'd like to point out that mutually beneficial cooperation and development of our relations will not undermine the interest of any third party," foreign ministry spokesman Liu Jianchao told a regular briefing.

"The concern of the relevant party is groundless and unreasonable."

He said China and Israel should "overcome external interferences" when developing their relations.

US Secretary of State Condoleezza Rice last week prodded Israel to curb its military sales to China, reiterating "rising concern" about Chinese military modernization.

Israeli Foreign Minister Silvan Shalom insisted Sunday his government had "acted in good faith" amid continued fallout from a deal to upgrade Harpy Killer drones which Israel sold to China.

"China's government attaches great importance to its mutually beneficial cooperation with Israel," ministry spokesman Liu said.

"It is in the interest of the two peoples as well as peace and stability in the region and the world."