By Linda Sieg
TOKYO (Reuters) - Expectations are growing in Japan that Prime Minister Shinzo Abe will meet Chinese President Xi Jinping for an ice-breaking chat next month, while an aide signaled Abe may postpone visits to a shrine for war dead that have infuriated Beijing in the past.
Any talks between the two leaders on the sidelines of an Asia-Pacific leaders gathering in Beijing in November would likely be well-choreographed, but without the trappings of a formal summit, a Japanese diplomatic source said.
A one-on-one meeting would nonetheless be a symbolic breakthrough in ties between the world's second and third-biggest economies, which have turned frigid in the past two years over a territorial row, regional rivalry and the bitter legacy of Japan's wartime occupation of China.
With a month to go, Beijing is seeking assurances that Abe will not repeat a visit to Tokyo's Yasukuni Shrine for war dead - seen by China as a symbol of Japan's past militarism - any time soon, experts and Japanese lawmakers said.
A public promise not to pay his respects at Yasukuni again would be impossible for Abe, whose conservative agenda includes recasting Japan's wartime history in a less apologetic tone.
But Koichi Hagiuda, a ruling Liberal Democratic Party (LDP) aide to Abe, said the prime minister could put off a visit if he judged that was in Japan's national interests.
"He (Abe) has not promised to go to Yasukuni every year, but ordinary Japanese think that he would go once a year. However, if this creates a situation that would hurt national interests, it is possible he could make a comprehensive decision and put it off for a while," Hagiuda told Reuters.
He declined to say how long "a while" was, stressing that the decision was up to Abe himself.
Abe has been stepping up his calls for a meeting with Xi and told a parliamentary panel on Wednesday: "I think China also is becoming more positive about improving Sino-Japanese relations."
Just the evening before, Abe spoke briefly with Li Xiaolin, the daughter of former Chinese president Li Xiannian and said to be close to Xi, at a dance performance in Tokyo.
The theme of the performance was the crested ibis, a symbol of Sino-Japanese friendship.
Abe made his first overseas trip as prime minister in 2006 to China and did not pay his respects at Yasukuni during his brief, one-year term - a decision he later said he regretted.
But Abe has not met Xi one-on-one since taking office again in December 2012. A visit to Yasukuni last December outraged Beijing and even prompted Japan's security ally, the United States, to express disappointment.
Hagiuda said that Abe was highly unlikely to pay his respects in person at this year's autumn festival, which begins on Oct. 17. Abe could opt to send a ritual offering as he has done before, other lawmakers said.
Conservative Japanese politicians typically visit Yasukuni at the shrine's spring and autumn festivals and the Aug. 15 anniversary of Japan's defeat in World War Two. Abe last visited on Dec. 26, 2013, exactly one year after he assumed office.
Japanese lawmakers who recently visited Beijing said China, as the Asia-Pacific summit host, seemed worried about being viewed as churlish in terms of diplomatic etiquette if Xi refused to meet Abe but was keen for a sign that Abe would not visit Yasukuni any time soon.
"They want some...sign that Japan has compromised a bit or else there is a problem in terms of 'face'," LDP Deputy Secretary-General Norio Mitsuya told Reuters.
Liu Jiangyong, an expert in China-Japan ties at Tsunghua University in Beijing, said it was hard to predict whether Xi and Abe would meet bilaterally, but added that if they did, the Chinese leadership would certainly ask him not to go to Yasukuni again.
"But if he does make the visit again, that's tantamount to telling Chinese leaders that the meeting has been fruitless," Liu said.
China also wants Japan to acknowledge the existence of a formal territorial dispute over tiny islands in the East China Sea controlled by Japan but also claimed by Beijing, Japanese lawmaker Mitsuya said.
Japanese diplomatic experts ruled out such a move but said it was possible that the two sides could find a diplomatic formula to "agree to disagree" over the uninhabited islands, known as the Senkaku in Japan and the Diaoyu in China.
Certainly, signs of a thaw have been mounting.
A slowing Chinese economy and a sharp drop in Japanese investment are key factors prompting Beijing to rethink its relations with Tokyo, experts said. Japanese firms' investment in China fell 40 percent on an annual basis in the first half of 2014 after sliding by nearly one-fifth last year.
Reduced tensions would also benefit Japanese firms doing business in China and a chat with Xi would be a feather in Abe's diplomatic cap - he has traveled to 49 countries since taking office, but been unable to meet Chinese or South Korean leaders.
The foreign ministers of China and Japan have met twice since August and Chinese Vice Premier Wang Yang told a 200-strong delegation of Japanese business executives in late September that he was keen to revive high-level economic talks with Japan.
The two sides also agreed "in principle" to resume stalled discussions on a mechanism to avoid an unintended clash, fears of which had risen as Chinese and Japanese ships and planes play cat and mouse near disputed isles in the East China Sea.
An agreement by the leaders to proceed with setting up such a crisis management mechanism might well be the most concrete outcome of any meeting between Abe and Xi.
"That is the maximum we can expect at this point," said Kunihiko Miyake, a former diplomat now at the Canon Institute for Global Studies in Tokyo. "It is extremely important to send the right signal to business circles in Japan and China."
(Additional reporting by Kaori Kaneko in Tokyo and Megha Rajagopalan in Beijing; Editing by Raju Gopalakrishnan)