UK and China have signed a nuclear deal to help fund a new nuclear power station in Britain.

Chinese President Xi Jinping who is on an official visit to London presided over the signing of the deal based on which, China will take a stake in the EDF project in Somerset that is due to start operating by 2025 and is the first European nuclear plant to be built since Japan's Fukushima disaster in 2011.

During the meeting, the two sides also discussed contracts worth $46 billion that Prime Minister David Cameron is keen to clinch.

After a day of pomp, Xi got down to business at Cameron's Downing Street residence and attended a meeting in London with chief executives of big British companies.

British officials and business leaders say the rise of China is impossible to ignore: China's economy - the second biggest in the world - is four times the size of Britain's.

"We encourage investment, and China is investing more in Britain now than other European countries," Cameron  told China Central Television.

China on Wednesday nearly doubled a bilateral currency swap agreement with Britain to 350 billion yuan ($55 billion), part of Beijing efforts to spur more use of the yuan abroad.

At a joint press conference with visiting Chinese president, Cameron said Britain could not have a "frank" discussion with
China about issues such as human rights if it did not have a strong economic and trade relationship with the country.

He also said, Beijing had plans to reduce the supply of cheap steel which has hurt Britain's struggling steel making industry.

For his part, Xi Jinping said he wanted to build a global strategic partnership with London and deepen relations between the two countries.

"I'm making this state visit to the UK to build on past achievements ... and take China-UK ties to a new level," he told.