At a meeting in Beijing in December, Chinese president Hu Jintao had a powerful message for officials from the People’s Liberation Army Navy. “Prepare for war,” Hu said, using a Mandarin term — junshi douzheng — that means “conflict in general.”

Amplified and misrepresented by the foreign media, Hu’s words echoed across Asia and the Pacific Ocean, alarming observers in Japan, India and other nations and eliciting a cool response from the U.S. Navy. “Nobody’s looking for a scrap here,” Adm. John Kirby, a Pentagon spokesman, told AFP. “Certainly we wouldn’t begrudge any other nation the opportunity to develop naval forces.”

“Hu was highlighting the importance of continued naval modernization,” pointed out M. Taylor Fravel, a professor of security studies at the Massachusetts Institute of Technology. The Chinese president’s statement “does not refer to a desire to go war, much less preparations for specific combat operations,” Fravel said.

But the tizzy over Mandarin semantics belies a more serious issue. In a little less than a decade — about as long as it takes the U.S. to fund, build and commission a single aircraft carrier — the PLAN has evolved from a coastal defense force to the early stages of a blue-water navy worthy of concern.

As part of its 11th five-year military plan beginning in 2006, China has: commissioned dozens of new frigates, destroyers, submarines and amphibious ships; begun sea trials of the country’s first aircraft carrier, the former Soviet Varyag; deployed ships overseas for the first time in modern Chinese history; and developed a “carrier-killer” system that combines ocean-surveillance satellites, drones and maneuverable Anti-Ship Ballistic Missiles.

The past few years have represented a “coming-out party for China as a great power on the rise,” according to Andrew Erickson, a Naval War College analyst and author of an influential book series on the PLAN.

While China has been flexing its newly-developed muscles, the Pentagon has been preoccupied with the wars in Iraq and Afghanistan and, more recently, planning for as much as $1 trillion in budget cuts over the coming decade.

Washington’s reaction to Beijing’s naval rearmament was belated, but forceful. In the last two years, the Pentagon has: increased its shipbuilding rate, including doubling submarine production; launched development of new naval robots, missiles and spacecraft; forged new basing agreements with several Western Pacific allies; and begun work on a new, combined naval and air strategy — AirSea Battle — aimed at restoring the U.S. military’s proficiency in high-end warfare.

Beijing’s next moves in this escalating Pacific arms race could make previous developments seem minor in comparison. In 2012, the second year in a new five-year planning cycle, the Chinese navy is set to make potentially huge gains below, on and above the sea. New weapons, new operational doctrines and expanded support infrastructure for the PLAN could fulfill Hu’s directive to “prepare for war.” ­­­­

Breaking Defense spoke to several U.S.-based experts, asking them to anticipate developments for the coming year.

According to the Congressional Research Service, China will probably commission two new submarines in 2012: a Type 094 nuclear-powered ballistic-missile submarine and a Type 041 diesel-electric attack submarine.

That’s consistent with the recent trend for PLAN sub production. Leaving aside a spike in submarine acquisition ­­caused by the purchase of Russian-built Kilo-class diesel attack boats in 2005 and 2006, Beijing has consistently bought two submarines per year, on average — a rate equal to U.S. submarine production and one sufficient to sustain a long-term force of around 60 subs of all types.

Short-range diesel boats account for the majority of Chinese acquisitions, underscoring the PLAN’s continued focus on coastal defense plus offensive operations against regional competitors in and around the China Seas, including Japan, South Korea, The Philippines and, of course, Taiwan.

China is not building a submarine force capable of global, blue-water operations — and probably won’t in 2012. “I don’t think they know whether they want to make the full-up commitment it would take to do this [submarine] thing right,” Owen Cote, Jr., an analyst at MIT, tells Breaking Defense.

That is not to say China won’t make big improvements in undersea warfare in the coming year. But instead of expanding its sub fleet, the PLAN is increasingly focused on making better use of the submarines it already has.

In the past, Chinese subs have spent very little time at sea. In 2005, no Chinese submarines spent more than a few days away from port, according to U.S. Navy documents obtained by the Federation of American Scientists.

The number of sustained patrols increased to two in 2006 and six in 2007. While still idle compared to the U.S. Navy’s 71 submarines and their roughly 100 annual patrols, the PLAN undersea force is now patrolling the China Seas in a meaningful way, and should continue doing so in 2012. “The main thing is they’re going out more,” Cote says.

The PLAN’s rapidly-modernizing surface fleet has also been spending more time at sea. And in contrast to the regionally-focused submarine force, the surface navy also undertakes limited long-range deployments to the Indian Ocean for counter-piracy operations.

CRS reports that China will probably launch at least six large vessels in 2012, including one Type 052C destroyers, three Type 054A frigates, a Type 071 amphibious transport and an underway replenishment ship similar to the U.S. Navy’s T-AKE class. The PLAN possesses around 140 large warships, compared to the U.S. Navy’s roughly 280.

More strikingly, China could finally establish the foreign shore infrastructure to make blue-water operations routine in 2012, as they are for the U.S. Navy. At the same time, the PLAN surface fleet will probably get involved in more large-scale exercises meant to improve its ability to fight and win against a determined, high-tech opponent.

In mid-December, Jean-Paul Adam, foreign minister of the Seychelles, an Indian Ocean island nation, said his government had invited China “to set up a military presence.” That could get interesting since the U.S. Air Force operates Reaper drones from a Seychelles airfield. Beijing confirmed it would begin using the Seychelles for naval resupply but declined to characterize it as a “base.”

Even so, that development points to a surface fleet moving beyond merely churning our hardware and focusing on equally important, and arguably more difficult, operational and logistical challenges.

Along those same lines, the coming year could also see at least one major naval exercise involving all three of the PLAN’s geographic fleets: the North, East and South China Sea fleets. “It’s not something done very often,” notes Bud Cole, a professor at the National War College. (Cole stresses that his views are his alone and do not reflect the official position of the U.S. military.)

The Chinese navy, Cole adds, “is continuing to work very hard on joint and integrated operations — a tough development to master.”

From the PLAN’s perspective, the major risk is that deployments and exercises in 2012 could result in diplomatic blowback.

“The PLAN’s desire to train in surrounding areas is perfectly reasonable and logical for an aspiring navy,” says an independent analyst who uses the Internet handle “Feng.” (Born in China but now living in the U.S., Feng relies on the pseudonym to preserve his ability to interact with Chinese sources on-line.) Japan in particular “seems to get nervous every time China sends fleet past the first island chain [on the eastern edge of the East and South China Seas] to do an exercise,” Feng tells Breaking Defense.

Easily the biggest Chinese naval news of 2011 was the July maiden test voyage, right outside the port of Dalian in northern China, of the PLAN’s reconditioned Soviet-built aircraft carrier Varyag. At the same time, the PLAN was hard at work on the J-11 carrier-capable jet fighter, a reverse-engineered Soviet Su-33 Flanker.

Beijing insists the carrier and her planes are meant only for testing and training purposes. But photos from Dalian show the ex-Varyag with the latest sensors and point-defense weapons. “Its hardware does not need to be upgraded radically for operational service,” Erickson, the Naval War College analyst, wrote in a recent article.

Feng says the PLAN could build a U.S.-style carrier battlegroup using the latest Type 052Cs and Type 054As and new replenishment ships. A carrier battlegroup would be an obvious candidate for the kinds of long-distance deployments that Chinese destroyers and frigates currently perform on their own.

In any event, the PLAN has not yet mated up the ex-Varyag and the J-11s, and it’s not clear when that might happen. “Obviously, people will keep their eyes on Varyag, but I don’t expect to see naval Flankers taking off and landing on it next year,” Feng says. Instead, he says, “there will be more sea trials and more testing and take-offs and landings of helicopters.”

But naval experts have always viewed ex-Varyag as a first step towards a home-built Chinese carrier. “We may see, by the end of next year, the revelation that they’re building an indigenous carrier,” Cole says.

“The first domestic aircraft carrier hull … will closely resemble the Russian Kuznetsov class (of which Varyag was originally a member), albeit with largely internal improvements that are invisible to casual observers,” Erickson wrote.

Carriers are dramatic, but potentially the most far-reaching PLAN developments of 2012 could occur in space. Specifically, China could complete an ambitious anti-ship system that combines targeting satellites and ballistic missiles — and seems specifically tailored for attacking U.S. Navy aircraft carriers on the open sea.

For several years now Western analysts, naval officers and elected officials have worried aloud about the DF-21D anti-ship ballistic missile. In December 2010 Adm. Robert Willard, the head of U.S. Pacific Command, said the missiles was probably ready for combat. “I think China would perceive that it has an operational capability now,” Willard said.

Cole disagrees. “I haven’t seen anything indicating they’ve test-fired it successfully,” he says of the DF-21D. Moreover, the missile requires “cueing.” That is, some other system must give the missile fairly precise targets coordinates, ensuring the missile gets close enough for its own on-board guidance system to take over. That’s generally understood to mean satellite-based surveillance.

Indeed, China has been laboring for years to assemble a constellation of ocean-surveillance satellites codenamed Yaogan. “The driver for China’s focus on ocean surveillance … is as part of a larger system to counter U.S. Navy power, specifically carrier battlegroups,” says Brian Weeden, an analyst with the Secure World Foundation.

Despite several launches of Yaogan satellites since 2006, “they’re still working on getting a complete satellite constellation up,” Cole says. 2012 could be the year it finally happens. The next 12 months are likely to see a record number of Chinese rocket launches, perhaps even exceeding U.S. launches, Weeden predicts.

It’s also possible that the Yaogan constellation is complete, but the Chinese haven’t yet tested it with the DF-21D. In that case, a test could occur as early as Jan. 11, Cote says.

That date, which falls near the Chinese New Year, is a traditional favorite of the People’s Liberation Army, for reasons deeply rooted in the Chinese language and popular numerology. The PLA Air Force flew its J-20 stealth-fighter prototype for the first time on Jan. 11, 2011. The PLA tested anti-satellite weapons on that date in 2010 and 2007.

Even if Jan. 11 passes without a missile test, 2012 will be big year for the Chinese navy as it continues a decade of sustained development, pursues a new five-year procurement cycle and responds to U.S. moves in the western Pacific.

Chinese President Hu did not refer to any specific attack plan when he advised navy officials to “prepare for war.” But preparation for warfare in general is the driving force behind the People’s Liberation Army Navy.

David Axe, a member of the AOL Board of Contributors, is a freelance war correspondent and author. His most recent book is a graphic novel, War is Boring.