Singapore has found itself caught in China’s crosshairs after its shipment of nine armored troop carriers was impounded last week in Hong Kong. The dispute has taken on a political tone with Chinese state media even suggesting the vehicles, which were used in a routine drill in Taiwan, should be melted down.

Although nationalistic sentiments in China are growing, analysts expect the incident to have a limited impact regionally after officials of both sides have engaged in diplomatic negotiations.

Singapore's minister of foreign affairs, Vivian Balakrishnan, sought to play down the dispute on Tuesday.

No overreacting

"I wouldn't overreact to that... we expect commercial providers of services to strictly comply with the law. We expect the law to take its course," Balakrishnan was quoted by the Straits Times as responding to China’s protest on Monday over the vehicles and Singapore's military ties with Taiwan, which Beijing considers a renegade province.

Balakrishnan added Singapore won’t allow any single issue to hijack its longstanding, wide-ranging relationship with China.

FILE - Singapore's Foreign Minister Vivian Balakri FILE - Singapore's Foreign Minister Vivian Balakrishnan, left, shakes hands with Chinese Foreign Minister Wang Yi, right before they pose for a photo during the ASEAN – China Foreign Ministers' Meeting in Vientiane, Laos, July 25, 2016. FILE - Singapore's Foreign Minister Vivian Balakrishnan, left, shakes hands with Chinese Foreign Minister Wang Yi, right before they pose for a photo during the ASEAN – China Foreign Ministers' Meeting in Vientiane, Laos, July 25, 2016.

The minister, however, didn’t reveal why the contracted commercial shipping company carrying such sensitive “controlled items” had to make transits in two Chinese ports, including Xiamen and Hong Kong enroute to Singapore.

Instead, he concluded this incident will serve as a footnote on “how to do things strictly, carefully and by the law. It is not a strategic incident.”

In other words, Singapore won’t allow the dispute to spin out of control, neither is it prepared to sacrifice its national interests, including its relations with China or its military exchanges with Taiwan routinely, analysts said.

“There may be some trade-off, but Singapore would want to maintain its dignity and not have to make invidious choices,” said Alexander Neill, a Shangri-La Dialogue senior fellow for Asia Pacific security at the International Institute for Strategic Studies, adding that Beijing may find it acceptable that Singapore made some kind of statement on Taiwan's status in a behind-the-door format.

Boycott to Taiwan government

Neill believed the main trigger of the incident is China’s displeasure with Taiwan’s independence-leaning administration led by President Tsai Ing-wen, as China has long tolerated the city-state’s military exchanges with Taiwan since 1975.

Taiwanese President Tsai Ing-wen inspects honour g FILE - Taiwanese President Tsai Ing-wen inspects honour guard before a ceremony to mark the 92nd anniversary of the Whampoa Military Academy, in Kaohsiung, southern Taiwan, June 16, 2016. FILE - Taiwanese President Tsai Ing-wen inspects honour guard before a ceremony to mark the 92nd anniversary of the Whampoa Military Academy, in Kaohsiung, southern Taiwan, June 16, 2016.

Notwithstanding its military arrangements with Taiwan, Singapore has long taken China’s side to endorse the one-China principle, which acknowledges Taiwan as part of China.

The dispute, in addition, has more to do with the city-state’s souring relationship with China since Singapore supported the international arbitration ruling against China’s territorial claims in the disputed South China Sea, other analysts argued.

One stone, two birds

“It’s one stone killing two birds, which dealt both Singapore and Taiwan a blow,” said Lin Yu-fang, a former KMT party legislator in Taiwan.

Lin expects China to demand some kind of verbal concessions from Singapore in exchange for the retrieval of its armored vehicles.

“What it [China] wants is for Singapore to be less vocal in future with regard to the South China Sea dispute or the Association of Southeast Asian Nations affairs. It hopes that Singapore won’t be so supportive of the United States,” Lin said.

There is also a legal price for Singapore’s shipping company to pay: a fine of nearly $65,000 or a two-year jail term in Hong Kong for the ship owner, the Taiwanese politician added.

Analysts argued it's China’s intention to make an issue out of the dispute, but there’s little room for China to play it the hard way.

Come between Singapore and Taiwan

“It’s just one more way, I think, the Chinese see this as an opportunity to maybe drive away between the Singaporeans and the Taiwanese. And that’s probably not going to happen,” said Richard Bitzinger, a senior fellow at S. Rajaratnam School of International Studies under Nanyang Technological University in Singapore.

Bitzinger expects Singapore to stay quiet with its future military cooperation with Taiwan and learn its lessons in shipping future weaponry systems directly back to Singapore without making any stopover in future occasions.

And the only gain for China, he added, is to play up this incident to a domestic audience, sending a patriotic message to its people that the government will stand firm on its nationalistic stance.