"It's still case by case," said Peter Rodman, the new assistant defense secretary for international security affairs and the man in charge of defense policy toward Asia, the Middle East and Latin America.

Rodman told the Washington Times that the exchange program, which the U.S. halted in the wake of the downing of the EP-3 aircraft, was slowly resuming.

"But we haven't relinquished our right to look at each [exchange] individually and decide if it serves an interest of ours, if there's some balance and reciprocity in the program as a whole," he added.

According to the Times' top defense expert Bill Gertz in Wednesday paper, the administration and the State Department favor a resumption of the exchanges, while the Pentagon resists the idea.

Critics of the exchange program, fervently pursued by the Clinton administration, warn that in past exchanges the Chinese have picked up valuable information about U.S. military planning, combat abilities and logistics from the exchanges, without sharing similar information about their own military.

Noting that China's regime demanded a payment of $1 million for the EP-3 incident and its aftermath and the Pentagon instead offered about $34,000, Rodman told Gertz: "We gave the Chinese an answer, and the Chinese were unhappy with our reply, didn't accept the check. I'm not sure what happens next. I mean, they're asking us to reconsider."

"I think we're comfortable on the answer we gave them, which was well thought out. Really, I'm not sure what happens next. Perhaps it's up to China. I don't know."

Constructive for Whom?

Rodman said he hoped the Chinese "put this episode behind us, you know, and move on to something perhaps more constructive in the relationship."

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