Envoys from the two rivals held their third round of talks at the weekend, continuing a bid to reverse six decades of hostility that have made their relationship one of Asia's potentially most dangerous military flashpoints.

In the latest talks, held in Nanjing, they agreed to expand air links, allow mainland investment on the island and step up cooperation in crime fighting.

Beijing's official China Daily newspaper Monday hailed the talks as another milestone in relations across the Taiwan Strait, but analysts pointed out that the toughest issues had not been touched upon.

"The strategy is to push forward on concrete issues that can stabilise relations," said Jean-Pierre Cabestan, professor of political science at Hong Kong Baptist University.

"But they avoided any talks on sovereignty, security, on military pressure between the two shores -- these are subjects that are very far from their agenda."

The talks were the third since China-friendly Ma Ying-jeou of the Kuomintang was elected Taiwan's president last year.

Ma had campaigned on a reversal of predecessor Chen Shui-bian's fiercely pro-independence stance, which had infuriated China during Chen's eight years in office. Ties have improved rapidly since Ma took office in May.

However, that has not translated into any reduction in the military hardware both sides have built up in the event they go to war.

China and Taiwan split in 1949 after a civil war and Beijing views the self-ruled island as part of its territory awaiting reunification, by force if necessary.

China has at least 1,300 ballistic missiles pointed at Taiwan, and has deployed advanced Russian-made SU-27 and SU-30 fighters near the island, according to the Taiwanese government.

Andrew Yang, director of the Chinese Council of Advanced Policy Studies in Taiwan, a private think-tank, said the military issue was lurking in the background as a potential spoiler of improved ties.

"Beijing still continues to hold the use of force against Taiwan as one of their options and they are still deploying a lot of missiles in the coastal regions," Yang said.

"There is not much political trust with each other because Beijing is still not fully confident that... Taiwan is going to avoid Beijing's concern -- independence."

He said that any move to discuss sensitive political issues such as sovereignty or defence would probably not come for another two terms of the ruling Kuomintang party, or 10 years.

Willy Lam, adjunct professor of history at the Chinese University of Hong Kong, also said the prospect of China scaling down its military build-up against Taiwan remained doubtful.

He said powerful forces on both sides remained opposed to full rapprochement -- China's People's Liberation Army (PLA) and Taiwan's opposition Democratic Progressive Party (DPP).

Zhang Wensheng, a professor at Xiamen University's Taiwan Research Centre, said that both sides had decided to take an economic-focused approach to patching up ties before broaching more sensitive issues.

"First comes the easy part then the hard part, first economics then politics, to gradually push forward cooperation between the two sides," he said.

Analysts nevertheless said the agreement to let Chinese companies invest in Taiwan was significant, even though there would be restrictions on what areas these companies could participate in, amid concerns within the island.

"There is concern that this continuous integration of economic investment issues will compromise Taiwanese independence, sovereignty or autonomy," said Yang.

"But by entering into negotiations it also symbolises that both sides are still very much sending goodwill messages to the other side."

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