The consortium led by Hyundai began work on the Mubarak al-Kabir port in May, raising the ire of authorities in Baghdad who have repeatedly demanded a halt to the project, which they say will strangle Iraqi shipping lanes.

"We are warning the companies working on the Kuwaiti port against continuing the project," said a statement from Ketaeb Hezbollah.

"The Iraqi people will not forget what the government of Kuwait is doing by building a port to strangle Iraq economically," said the statement, posted on the group's website.

The militia, which US officials say is backed by Iran, claimed responsibility for a June 6 rocket attack in which six American soldiers were killed. It was the worst day of the deadliest month for US forces in three years. The military lost 14 troops in June.

US military officials in Iraq said earlier this month that rockets used against their soldiers had been traced to the group, and that they carried the signature of Iran.

Iraqi Prime Minister Nuri al-Maliki said on Friday that Kuwait had yet to notify Baghdad officially of the Mubarak project. He said Baghdad only learned about it from third parties.

Earlier this month, Iraqi Transport Minister Hadi al-Amari urged Kuwait to stop work on the port which he said would block Iraqi access to shipping lanes.

The $1.1 billion (778 million euro) facility, on Kuwait's Bubiyan Island, is scheduled for completion in 2016.

The Gulf is the main export outlet for Iraqi oil, which accounts for the lion's share of the country's revenues, and Baghdad has started major work to modernise its outdated ports.

The bilateral agreements span cooperation in water, mining, energy and industrial sectors.

As part of a $500 million (354 million euros) deal, China agreed to provide Iran with 60 energy recovery incinerators, which are to be installed within a year in major cities and in Iran's northern tourism hub along the Caspian sea.

China also pledged to boosts its imports of Iranian mineral products, state TV reported.

Iran's Vice President Mohammad Javad Mohammadi-Zadeh told the television that China was Iran's leading economic partner, with last year's trade volume reaching $30 billion (21 billion euros).

The agreements were signed during a visit by He Guoqiang, a senior executive of the Chinese Communist Party, who heads a delegation visiting Iran. He was received by Iranian President Mahmoud Ahmadinejad.

"The main objective is to quickly bring our economic and trade exchanges to $100 billion," Ahmadinejad said during Saturday's meeting, according to his website.

"China, with a strategic vision, wants to strengthen its cooperation with Iran, because it is in the interest of both nations as well as regional countries," He Guoqiang was quoted as saying by the website.

China's ambassador to Tehran told IRNA recently that bilateral trade would reach $40 billion (28 billion euros) this year.

China and Iran have become major economic partners in recent years, partly thanks to the withdrawal of Western companies in line with sanctions against the Islamic republic over its contentious nuclear drive.

Beijing, which now buys about 20 percent of Iranian crude, opposes the policy of the United States and its European allies seeking to strengthen UN sanctions against Iran, which they believe is seeking nuclear weapons.

Tehran denies this, saying its nuclear programme is purely for peaceful objectives.