During an interaction with officers at China's National Defence University, Hagel was asked whether the US was stirring up trouble in the East and South China Seas because it feared someday China will be too big a challenge for America to cope with.
Hagel, who wrapped up his three-day visit to China today, took pains to explain that the US would not meddle in territorial disputes in the region and was not out to "contain China". He said the US took no position on rival territorial claims.
"Our commitment to allies in the region is unwavering," the Hong Kong-based South China Morning Post quoted him as saying.
"The Asia-Pacific region is the most militarised in the world, and any one of these challenges could lead to a conflict, a deadly conflict," Hagel said.
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"The cost of conflict will rise as economic interdependence grows. We must do our part to build greater trust, confidence and co-operation between our two militaries," he said.
China-US relations "will not come at the expense of our relations with others in the region or elsewhere, nor should it, for China or for the United States", he said.
"The model seeks to manage competition, but avoid the traps of rivalry," he said.
China has been wary of US Asia Pivot strategy that refers to a significant shift in Washington's foreign policy from the Middle Eastern and European regions to the East and South Asia.