Australian Strategic Policy Institute analyst Dr Andrew Davies says it is a good idea for Australia and the United States to conduct trilateral war games with China.
Mr Rudd says Australia has previously done some work with the Chinese military and it will be a good exercise in transparency and cooperation.
"Remember our region, for example, is racked often by natural disaster. I am long on the record that our respective militaries across the region should be acting much more closely together when it comes in particular to search and rescue operations [and] counter natural disaster operations," Mr Rudd said.
Ambassador Zhang says anything that is conducive to the peace and stability of the region is welcome.
"I think that any positive signs will help to improve the relationship because this relationship is very solid," he said.
China has been building up its military capabilities in recent years, sparking unease among regional neighbours over its motives.
Chinese state media is reporting that
Dr Davies says it is necessary for China to start engaging with Western-aligned counties in the Asia-Pacific to counter suspicions about their military expansion.
"They're pretty clear about they are trying to do. They say explicitly in their white paper that they are building military forces so that no external power can be hegemony in the South China Sea, which is essentially their front yard. What they mean by that is the United States and its allies, and their military build-up is entirely consistent with that aim," he said.
Dr Davies says both sides will benefit from the joint military exercises.
"As well as just the general confidence building that operating up close with the Chinese Navy [will bring], it lets both sides see that each side is not necessarily a bogeyman," he said.
"But also just in terms of understanding each other's operating procedures, because we're guaranteed that Chinese naval forces and Western naval forces will bump up against one another in the Western Pacific, and just knowing how they operate can stop misunderstandings and possibly accidents from happening."
Dr Davies says even though it could present China with an opportunity to gather intelligence on Australian and US defence capabilities, that opportunity cuts both ways.
"Both sides would see how each other operate and there's always a bit of cat and mouse about these things as well. It would be very unusual for both sides to use the full range of their capabilities and use their radar in all of the modes that it can operate, for example, in combined exercises for that very reason."
But he warns the joint military exercises could inflame existing regional tensions.
And he says that will obviously have implications for Australia.
think we are going to be caught in the middle with or without