"China has increased their military capabilities and spending more on defence," Defence Minister A K Antony said at a Security Forum here.
"We are concerned over it," he said.
The Defence Minister said "even though we don't believe in an arms race, but in our own way, to protect our national interest, we are also strengthening our capabilities on our borders."
Saying New Delhi favoured stable relations with its neighbour, Antony said the two countries had begun military- to-military cooperation.
"We had contacts at the army level, but of late, we have started extending them to he navies of the two nations," Antony said at the conference where the developments in the South China Sea were in sharp focus.
Like India, Japan also expressed concern over lack of transparency in China's massive defence spending, saying this secrecy posed a threat.
China's military budget jumped over 11 per cent this year to a staggering USD 106 billion.
