BEIJING: Iranian President Mahmoud Ahmadinejad held talks with Chinese President Hu Jintao in Beijing on Saturday in a rare visit to China coinciding with the start of the Paralympic Games.

Hu said in welcoming words to Ahmadinejad at the Great Hall of the People in Tiananmen Square that the two would discuss Sino-Iranian relations, among other issues, during their meeting.

"I would like to further exchange opinions with you Mr President about issues like Sino-Iranian relations," Hu told the Iranian President.

"I'd also like to take this opportunity to thank you and other Iranian leaders for the assistance your government provided for the Chinese people affected by the May 12 Sichuan earthquake," Hu said, according to state media.

"Both China and Iran are big developing nations... and (there is) great potential of cooperation," he added.

Hu was also quoted as saying Iran should settle its nuclear issue through dialogue.

"At present, the Iran nuclear issue is faced with a rare opportunity for the resumption of talks, and we hope all parties concerned could seize the opportunity and show flexibility, to push for a peaceful settlement of the issue," Hu reportedly told his Iranian counterpart.

China is involved in multilateral talks with the United States, Britain, France, Germany and Russia aimed at urging Iran to end its uranium enrichment activities in a long-standing dispute over Tehran's nuclear programmes. Iran and China are close allies, with Iran's vast oil and gas resources feeding China's growing energy demand. China is also one of the biggest exporters to Iran.

But relations soured when China voted in March for a UN Security Council resolution to tighten sanctions on Iran.

Iran has repeatedly said it has no intention of halting enrichment despite three sets of UN Security Council sanctions, and US and EU sanctions implemented over fears that Tehran is seeking to produce atomic bombs.

Hu and Ahmadinejad met last week in the Tajik capital of Dushanbe at a summit of the Shanghai Cooperation Organisation (SCO), a regional grouping consisting of Russia, China and four ex-Soviet states.