Chinese President Hu Jintao and Democratic Party of Japan leader Ichiro Ozawa agreed Tuesday to set up an institution for regular dialogue between the Chinese Communist Party and the DPJ, an apparent warning to the governing Liberal Democratic Party.

Ozawa said Hu told him during a meeting in Beijing that he hopes China-Japan relations will improve.

"I hope exchanges on each level will be expanded," Ozawa quoted Hu as saying.

He said Hu did not mention Prime Minister Junichiro Koizumi's visits to Yasukuni Shrine. China has refused meetings with Koizumi because of his visits to the controversial shrine.

At the start of the meeting, Hu welcomed Ozawa's visit "at a time when China-Japan relations are facing difficulties," the DPJ leader quoted Hu as saying.