Pro-Taiwan independence activists call for the referendum on the streets in front of the headquarters of the ruling Democratic Progressive Party (DPP) during a demonstration in Taipei on October 20, 2018. Sam Yeh | AFP | Getty Images

Chinese authorities hate the word "independence." But whether spoken by fringe figures in Hong Kong or marchers demonstrating in Taiwan, they are hearing it all the same. Compounding frustrations in Beijing have worsened ties with the United States, which sailed warships through the Taiwan Strait on Monday for the second time since July. International criticism has also mounted over a human rights crackdown on ethnic Uighurs in the western region of Xinjiang, whom authorities fear want to break away. "The main problem is that the Communist Party of China is paranoid about calls for separatism and independence and continually overreacts to them," Michael Kovrig, senior advisor for North East Asia at the International Crisis Group, told CNBC on Thursday in an email. China's foreign ministry did not immediately respond to CNBC's request for comment. But at a press briefing in August, the foreign ministry's Lu Kang reiterated Beijing's stance on Taiwan, saying: "There is only one China in the world. The government of the People's Republic of China is the sole legal government representing the whole (of) China. Taiwan is an inalienable part of China's territory."

Trump may also be attempting to put more pressure on China on multiple fronts in order to gain negotiating leverage on trade. If so, this kind of linkage between issues is a risky tactic that could backfire by deepening the rift between the U.S. and China. Michael Kovrig senior advisor, International Crisis Group

The United States and China are currently engaged in a tit-for-tat tariff war, and military tensions surrounding Taiwan could further complicate efforts at resolving the trade standoff. U.S. President Donald Trump "may also be attempting to put more pressure on China on multiple fronts in order to gain negotiating leverage on trade," Kovrig said. "If so, this kind of linkage between issues is a risky tactic that could backfire by deepening the rift between the U.S. and China." Kovrig said China's "heavy-handed" responses to Taiwan add to frustration among local independence advocates while eliciting stronger shows of support for the island from the U.S., potentially setting the stage for escalating tensions. "It would be better for China to take a more relaxed and confident approach, based on soft power and positive incentives, rather than threats and punishments," he said.

One China policy

Beijing regards Taiwan as a renegade province under its One China Policy, and opposes other countries pursuing diplomatic ties with the self-ruled island. China often backs anti-independence warnings with military threats, which it repeated Thursday. "If someone attempts to split Taiwan from China, the Chinese military will take any necessary actions at any cost," Defense Minister Wei Fenghe said at a military forum in Beijing, the state-run China Daily reported. Despite China's efforts to isolate Taiwan politically, Beijing has long courted Taipei's investments and their economic ties remain robust. Taiwanese technology giant Foxconn, which manufactures iPhones for Apple and Kindles for Amazon in factories in southern China, is a major job-provider.

Discussions of independence in Taiwan, ruled separately from the mainland for nearly 70 years and possessing its own military, is a major issue over which China's response can drastically change. When the anti-independence Kuomintang, or Nationalist Party, was most recently in power from 2008-2016, the presidents of China and Taiwan held a historic summit in Singapore. But with the traditionally pro-independence Democratic Progressive Party now in control, Beijing's attitude has hardened, seen in more aggressive efforts to persuade countries to cut diplomatic relations with Taiwan, even as President Tsai Ing-wen takes a cautious stance towards China.

Growing sense of siege

Such pressure, as well as frustrations among independence supporters with Tsai's prudence, was one of the factors behind a demonstration last Saturday in Taipei calling for a referendum on the issue. Analysts say outright independence still lacks widespread support in Taiwan — and crucially in Washington — and such a plebiscite is unlikely anytime soon. But there is clearly a growing sense of siege. "The tightening of conditions in Hong Kong, in Xinjiang and in Chinese society more broadly, combined with China's military modernization and increasingly robust posture towards Taiwan, have convinced many Taiwanese that the status quo (of existing autonomy) is under threat," Jonathan Sullivan, director of China Programs at the University of Nottingham's Asia Research Institute, said in an email Thursday.

Taiwan President Tsai Ing-wen waves to the supporters at the celebration of the 14th presidential inauguration on May 20, 2016 in Taipei, Taiwan. Ashley Pon | Getty Images News | Getty Images