ISLAMABAD, March 23: China announced on Tuesday a 100 million yuan ($12.08 million) interest-free loan for Pakistan's armed forces and plans for training facilities for armed forces personnel during talks between the defence ministers of the two countries.

Chinese Defence Minister Gen Cao Gangchuan told his Pakistani counterpart Rao Sikandar Iqbal during a meeting at the defence ministry in Rawalpindi that Beijing wanted to further enhance and strengthen relations with Pakistan "in all areas concerning the three (defence) services," a government statement said.

It quoted Gen Cao Gangchuan as saying that China would provide the 100 million yuan loan for the Pakistani armed forces so as to consolidate and develop cooperation between the two countries.

He said China planned to invite Pakistani military personnel for training there and similarly Pakistan would provide training to Chinese military personnel. He also invited Rao Sikandar Iqbal to visit China.

Gen Cao, according to the statement, said China attached importance to what he called an "unbreakable" friendship with Pakistan and that excellent relations between them had remained unaffected by changes in international politics.

The statement quoted Rao Sikandar Iqbal as telling Gen Cao that the people of Pakistan were "really indebted to China for the invaluable assistance" it gave in the fields of defence and defence production, including contribution to the modernization of armed forces.

He also told the Chinese delegation that Pakistan was making concerted efforts to stamp out terrorism. The official statement quoted Defence Secretary Hamid Nawaz Khan as telling Gen Cao Gangchuan in the meeting that China was "the only trustworthy friend of Pakistan" and that no country was more valuable for Pakistan than China.

He said China was "our only real friend that always kept its doors open for Pakistan". Earlier, a contingent of the three armed forces presented a guard of honour to Gen Cao Gangchuan on his arrival at the defence ministry, the statement said. Gen Cao had called on Prime Minister Mir Zafarullah Jamali in Islamabad on Monday after arriving for a five-day visit.