In a deal that the deal will aid Blackstone''s investment in their country, the Chinese government has agreed to pay $3 billion for a 10-per cent stake in US private equity company Blackstone.

China will buy the stake through a newly formed state investment fund and will be part of Blackstone''s $7-billion share floatation planned for next month.

While allowing the Chinese government to tap into the global private equity boom, the investment will give Blackstone a natural advantage in Chinese takeover deals, where foreign companies often struggle to get the government''s approval when trying to acquire an stake in Chinese companies.

BBC Robert Peston, business editor, BBC, was quoted on the online edition of the UK broadcaster as saying, "When the Chinese are buying into private equity every investor in the world should take note."

The news of the deal could raise opposition among US lawmakers, some of who remain suspicious of China''s growing economic clout and in 2005, China''s hopes to buy US energy giant Unocal fell through in the face of fierce political opposition in the US.

Significantly, the announcement has come just days ahead of Chinese vice premier Wu Yi visit to the US.

Blackstone was recently part of a consortium that launched and then abandoned plans to launch a takeover bid for UK supermarket group Sainsbury''s.