Taiwan's fighter jets would fall short in combat against military rival China, the U.S. government said in a report on Monday that could lead to new weapons sales sure to anger Beijing.

Many of Taiwan's roughly 400 combat aircraft would not work in action due to age and maintenance problems, while protection of the island's airfields little more than 160 km (100 miles) from China was a major issue, the U.S. government's Defense Intelligence Agency said in the report, released in Taiwan.

The one-off report, ordered by Congress, says upgrades are needed as China gets stronger. The United States is Taiwan's top arms supplier but also wants to improve its ties with Beijing.

China reacted angrily last month after President Barack Obama's administration unveiled its first arms package for self-ruled Taiwan, which Beijing claims as its own, saying it would impose unspecified sanctions on the companies involved.

Another jolt in Sino-U.S. relations could shake markets in Asia further after their bout of nerves over the reaction to last month's $6.4 billion U.S. weapons proposal.

Although Taiwan has nearly 400 combat aircraft in service, far fewer of these are operationally capable, the report says.

In recent years, the Chinese People's Liberation Army has increased the quantity and sophistication of its ballistic and cruise missiles and fighter aircraft opposite Taiwan, which has diminished Taiwan's ability to deny PRC efforts to attain air superiority in a conflict, it says.

Taiwan is seeking 66 new U.S.-made F-16 fighter jets, but Washington officials wary of another China backlash have hedged on the request, saying they must evaluate Taiwan's overall defense needs.

Congress may use the report to pressure the Pentagon into approving the F-16s, said Wendell Minnick, Asia bureau chief with Defense News.

Beijing has claimed sovereignty over Taiwan since 1949, when Mao Zedong's forces won the Chinese civil war and Chiang Kai-shek's KMT fled to the island. China has threatened to attack if Taiwan tries to formalize its de facto independence.

The United States switched diplomatic recognition from Taipei to Beijing in 1979, recognizing one China. But it remains Taiwan's biggest ally and is obliged by the 1979 Taiwan Relations Act to help the island defend itself.

(Editing by Paul Tait)