Japan is to establish new military outposts on remote islands, a report said Monday, as Tokyo looks to bolster its defence amid a territorial dispute with China.

Up to 350 troops each could be stationed on three islands in the far southwest, close to the Senkakus, which Beijing claims as its own under the name Diaoyus, the mass-selling Yomiuri Shimbun reported.

With the exception of the main Okinawa island, Japan's Ground Self-Defense Forces -- its army -- have no bases on the chain of islands that runs from the bottom of Kyushu to Taiwan. There are limited air force facilities in the area.

The lack of substantial military presence is a source of worry for some in Japan, who caution that it leaves Japan vulnerable to China's increasingly assertive stance.

Chinese ships have repeatedly moved into the Senkakus' territorial waters, since Tokyo nationalised some of them in September 2012, to confront Japanese vessels.

The islands lie around 2,000 kilometres (1,250 miles) southwest of Tokyo and around 200 kilometres from the north of Taiwan.

While most of the bickering has been between coastguards from both sides, observers say military ships are loitering over the horizon, with some warning of the risk of a confrontation.

Beijing has spent heavily on its military in recent years in a bid to develop a "blue water" navy that can project force far out into the Pacific.

This means getting through what it calls the "first island chain" including Japan's southwestern islands and the northern Philippines.

Tokyo is now planning to set up new outposts on three islands, including Amamioshima, some 150 kilometres (93 miles) south of the Senkakus, the Yomiuri said, citing unnamed senior defence ministry officials.

Deputy defence minister Ryota Takeda will visit Amamioshima this week to look at establishing a joint research project with the island, it said.

Two other candidate sites for the new posts include Miyako island and Ishigaki island, some 210 kilometres southwest and 170 kilometres south, respectively, of the disputed islets.

These units are to be in addition to a radar surveillance unit on Yonaguni, where a groundbreaking ceremony was held last month.

Bolstering the defence of Japan's southwestern islands "has an aspect of strengthening the Japan-US security alliance," a senior defence official told the Yomiuri.

Chief Cabinet Secretary Yoshihide Suga said under a new defence programme, Japan had already decided to enhance the military presence in the southwest and had been conducting research.

"At the moment, however, we have not decided on specific, concrete locations such as those reported," he told a regular press conference.

The report came just two days after the Japanese and Chinese trade ministers held talks in the first high-level meeting since Japan's Prime Minister Abe visited the controversial Yasukuni war shrine in December.

China is also locked in separate territorial disputes with Southeast Asian neighbours, including Vietnam where the row has recently flared into deadly riots, and the Philippines.