"We are watching it with great interest." This was how Japan's Deputy Chief Cabinet Secretary Yoshihiko Isozaki reacted as China and Russia held a joint naval exercise last week in which 10 of their warships passed near Japan's coastline.

This was a classic Japanese understatement, for although officials in Tokyo may be reluctant to admit this in public, the Russo-Chinese naval drill - the first of its kind - hit them hard. The episode not only serves as a resounding failure for Japan's longstanding efforts of keeping China and Russia apart, but also acts as a reminder that the naval race in the Pacific is accelerating.