China's envoy to Japan said that a high-level summit soon between top leaders of the two nations was unlikely, setting a pessimistic tone for bilateral ties that have been plagued by territorial disputes.
Ambassador Cheng Yonghua said diplomats from both countries were working to create conditions conducive to high-level exchanges.
But he said communications and even cultural exchanges have been affected by an East China Sea dispute over the Diaoyu Islands, known as the Senkakus in Japan.
"The atmosphere facing bilateral ties between the two countries is at a very critical point now," Cheng said on the sidelines of the Chinese People's Political Consultative Conference annual session on Sunday.
"There are no plans now to hold a high-level bilateral summit between leaders of the two nations."
Tensions started to flare up in September, when Japan said it would purchase three of the five uninhabited islands from a private citizen, triggering a furious response from Beijing. At the time, Vice-President Xi Jinping even described the purchase as a farce.
Bilateral ties appeared to be improving after a visit to Beijing in January by Natsuo Yamaguchi, an envoy of Japanese Prime Minister Shinzo Abe. During his meeting with Xi, Yamaguchi called for a high-level summit between the nations.
Yamaguchi later said he hoped the summit could be held in August to mark the 35th anniversary of the signing of the Sino-Japanese Treaty of Peace and Friendship.
But tensions flared up again when Japan alleged that Chinese frigates locked fire-control radar on a Japanese frigate and military helicopters on two occasions in January.
Beijing said the allegation was fabricated by Japan to perpetuate the "China threat theory". Cheng said: "I hope both nations can work hard together and show sincerity in trying to defuse tensions."
Mainland observers said the island dispute's impact on bilateral exchanges was wide-ranging, so a high-level summit was unlikely in the coming months. "Some academics have also refused to attend conferences hosted by Japan," said Professor Da Zhigang , an expert in Japanese affairs at the Heilongjiang Academy of Social Sciences.
"There is no official order banning us from participating in the events, but the atmosphere between the two nations has made it difficult for us. It is embarrassing if we criticise Japan, but it is also out of the question for us to support Japan."
Da added that China would also be focusing on internal issues after the National People's Congress.
Professor Lian Degui , from the Shanghai Institutes for International Studies, said both nations were trying to see how far they could push the other.