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Responding to a question on a media reports that China was planning to build a second overseas military base in Pakistan, he said, "I am not aware of what you mentioned".

China previous year opened its first military overseas base at Djibouti in the Horn of Africa.

The official said China shares some of the concerns of the USA about the terror issue in Pakistan and Washington is seeking to work with Beijing and other regional players to convince Islamabad about the need to crackdown on terror groups.

The spokesperson of Pakistan's Foreign Office had already rejected such a report saying that there was no proposal of building any Chinese Military base near Gawadar. "The economic relationship is also growing with China Pakistan Economic Corridor (CPEC)", the senior administration official said on condition of anonymity.

Observers say Jiwani could be a pressure tactic by Pakistan as China is already developing Gwadar where earlier reports said Beijing plans to station its marines.

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Chinese Foreign Ministry spokesperson Lu Kang, in a press briefing, said that linking Pakistan with terrorism will not help global community in its crackdown on terror camps. Last year, spokesperson Hua Chunying called rumors of a potential naval base at Gwadar "irresponsible remarks" and "hearsay".

Pakistan's move to allow Chinese currency is not a dramatic policy change, as the yuan is already accepted by many Pakistani companies, said Dong Dengxin, director of Finance and Securities Institute at Wuhan University of Science and Technology. "China always opposed linking terrorism with any certain country and we don't agree to place the responsibility of anti-terrorism on a certain country", said Kang.

"Terrorism is a common enemy of the world and crackdown on the menace needs joint efforts from the global community", Kang said during a press briefing in Beijing. He hoped that the cooperation between the two friendly countries would further grow in future.

China was quick to jump to Pakistan's defence when US President tweeted that his administration was stopping all aid to Islamabad for not using the money to flush out terrorists. However, cautions columnist Shamil Shams, the absence of American support could come at a price: China will now have greater leverage to set the terms for its development and defense projects within Pakistan.