The bone of contention
Japan calls it Senkaku islands while China names it Diaoyu. The islands lie in the East China Sea and assume significance because they are close to strategically important shipping lanes, offer rich fishing grounds and are reported to contain oil deposits. Japan maintains that it has been controlling these islands from 1895 onwards and had only given up its claim following World Wold II when it signed the 1951 Treaty of San Francisco. Under the treaty, Japan had renounced its claim to a number of territories and islands including Taiwan. The islands were however returned by the US in 1971 under the Okinawa reversion deal. Japan says that China raised no objections to the San Francisco deal but started laying its claim on the territory in 1970s when the possibility of oil resources in the area emerged. China, on the other hand, asserts that the Diaoyu islands have been a part of Taiwan since ancient times and should have been returned to Taiwan following the Treaty of San Francisco. The issue now threatens to blow into a major conflict between the two countries after Japan announced the USD 26.18 million purchase of the islands from the Japanese family that owned them.