China's war drills around Taiwan enter Day 2. Here's what it means for cross-strait relations

China's latest military exercises around Taiwan risk escalating cross-strait tensions — but war remains unlikely, political observers say.

Beijing warned that the two-day drills, which continued on Friday, were aimed at punishing the island's new President Lai Ching-te for his "hostility and provocations."

The escalation comes just days after Lai was sworn in on Monday. In his inaugural speech, Lai strongly urged China to stop its political and military threats against the self-governing island.

China's state news agency Xinhua said Taiwan's new leader, in his debut speech adopted "an even riskier and more radical approach than his predecessors." The drills are "legitimate, timely and entirely necessary," as acts of "Taiwan independence" in any form "cannot be tolerated," it added.

"This feels like a prelude to more and bigger military drills to come," Wen-Ti Sung, a nonresident fellow with the Atlantic Council's Global China Hub, said in a post on X.

"This is a signal to shape international narratives. The real 'punishment' against Taiwan may be yet to come, for it takes time."

Beijing considers democratically governed Taiwan part of its territory and Chinese President Xi Jinping has previously said reunification with the mainland was "a historical inevitability." 

China's Ministry of National Defense said the exercises, dubbed the Joint Sword-2024A, were a "powerful punishment" for the "separatist forces seeking 'independence.'"

The drills will focus on "joint seizure of comprehensive battlefield control, and joint precision strikes on key targets," it stated.  

China's People's Liberation Army (PLA) Eastern Theater Command also said it conducted sea assaults, land strikes, air defense and antisubmarine in the airspace and waters to the north and south of Taiwan Island.

In response, Taiwan was on high alert and its coast guard dispatched patrol vessels to monitor Chinese military movements.

Political observers highlight the latest escalation sends a signal that Beijing's attitude could harden toward Taiwan under the leadership of Lai — whom China has labeled a "stubborn worker for Taiwan independence" and a dangerous separatist.

While pre-inauguration signals pointed to a more moderate response, "Beijing appears to be shocked by Lai's affirmative language about Taiwanese sovereignty and identity," Eurasia analysts said.

In his speech on Monday, Lai said Taiwan's constitution makes it clear that the Republic of China — Taiwan's formal name — and the People's Republic of China "are not subordinate to each other."

He added that all political parties should oppose "annexation and protect sovereignty."

China's top diplomat Wang Yi criticized Lai on Tuesday, saying that "no matter what tricks they play, they cannot prevent China from ultimately achieving complete reunification," state media reported.

Taiwan's defense ministry condemned the Chinese drills as "irrational provocations," that undermine regional peace and stability.

"This pretext for conducting military exercises not only does not contribute to peace and stability across the Taiwan Strait, but also highlights its hegemonic nature," the ministry said. 

While the PLA drills have not risen to the level of China's response to former U.S. House Speaker Nancy Pelosi's visit to the island in August 2022, they do feature unprecedented coast guard patrols around several Taiwan-controlled offshore islands, Eurasia's analysts pointed out.

"Fujian Coast Guard vessels this week patrolled up to 2.8 and 3 nautical miles from the Wuqiu and Dongyin islands, respectively, entering their 'prohibited waters' for the first time," they said.

Under Xi, China has ramped up diplomatic, economic and military pressure on Taiwan as the island tightens informal ties with the United States.

Xi told U.S. President Joe Biden on the sidelines of the APEC leaders' summit in November that Taiwan has always been the "most important and sensitive" issue in China-U.S. relations.

U.S. politics will also influence cross-strait relations, noted Gabriel Wildau, managing director at Teneo Intelligence.

"Tensions would likely rise further if Republicans win control of both houses of the US Congress in the November elections, regardless of the outcome of the US presidential contest," he added.

Furthermore, as Lai grows more confident in his new role as president, he may "become emboldened" to depart further from his predecessor Tsai Ing-wen's relatively cautious positioning and "act on his pro-independence instincts," Wildau pointed out.

While war over Taiwan remains unlikely over the next decade, the frequency and intensity with which Beijing deploys these familiar military tools will likely increase, said observers.

The latest drills illustrate that cross-strait relations have entered an "unstable period," said Eurasia analysts.

But Beijing will likely "stop short of actions that would jeopardize U.S.-China stabilization efforts on the Taiwan issue, at least through the U.S. election," they added.