But it's China's biggest concentric ring that often garners the most attention. Beijing is known for gathering small bits of information from "friends" -- Chinese businesspeople, students, scientists, trade delegations and tourists traveling overseas -- which it assembles into a bigger picture.
"They spread a rather wide net," said James R. Lilley, a former CIA station chief and U.S. ambassador to China. "It's often a rather blurred line between 'cooperator' and 'undercover agent.' "
People may be motivated to provide information by money, patriotism, flattery or various forms of persuasion, analysts said. An overseas Chinese with a family back home might be approached, said Oxford's Tsang, and told: "I understand you have a daughter trying to get into college. I hear she may not be so bright, but I have a friend at that college and can put in a good word."
China's approach, sometimes referred to as "1,000 grains of sand," has complicated life for foreign counterintelligence agencies already burdened by the U.S.-declared war on terrorism, analysts said.
"There are 150,000 students from China. Some of those are sent here to work their way up into the corporations," Dan Szady, the FBI's assistant director for counterintelligence, told the National Intelligence Conference and Exposition in Arlington, Va., in February. "There are about 300,000 Chinese visitors annually and 15,000 delegations touring the U.S. every year."
Many of these people are potential spies, he added, gathering information or being questioned when they return to China.
"Even as we increase our numbers of agents, we can't possibly totally stop it," Szady said.
But the intelligence expert who requested anonymity said there was a temptation to believe that everyone who vaguely looks Chinese is busy funneling information back to Beijing. "There's a lot of hysteria," he said, citing an unsubstantiated claim by a bipartisan congressional commission five years ago that China operates 3,000 front companies in the United States.
"It's jingoism of the highest order," he said. "Also, what they do in appealing to patriotism is not a lot different from the French and the Israelis. The Israelis pulled a lot of the same motherland appeals with [Jonathan Jay] Pollard," an American military analyst sentenced to life imprisonment in 1986 for leaking secrets to Israel.
Espionage also works both ways. In 1995, the Australian media reported that China's embassy in Canberra, the capital, was bugged as part of a joint Australian-U.S. spy operation. And a U.S.-made Boeing 767 bought for then-Chinese President Jiang Zemin in 2000 reportedly contained more than 20 spying devices.
One analyst said that even if Chen's claim of 1,000 spies in Australia was accurate, they were almost certainly not all well-trained field agents. "The idea that they have such a large number working on behalf of Chinese intelligence seems a bit dubious," said Jonathan D. Pollack, director of strategic research at the Naval War College in Newport, R.I. "It's obvious that anyone wanting to defect wants to up their value."