CANBERRA, April 10 (AFP) - The Australian government said Thursday it would no longer co-author a UN resolution condemning China's human rights record, after securing an agreement to a formal bilateral dialogue on the issue.

Australian foreign minister Alexander Downer hailed the agreement as a major breakthrough, saying he did not know of any other country that had established a formal mechanism for raising human rights with China.

The dialogue was suggested by Prime Minister John Howard on his Easter fence-mending visit to Beijing and agreement was relayed by China's Justice Minister Xiao Yang in talks with Downer here late Wednesday.

However, human rights watchdog Amnesty International accused Canberra of compromising Australia's stand on human rights by abandoning support for the United Nations resolution.

The foreign minister said in a radio interview Thursday that Australia would no longer co-sponsor an annual resolution condemning China, to be debated in the United Nations Human Rights Commission next week.

Downer said China's agreement to the human rights dialogue was unconditional and his office denied any link with the UN resolution.

However, Chinese officials made it clear after Howard's visit that no such dialogue was possible while Australia continued to support the UN resolution, saying dialogue and confrontation excluded each other.

Downer said Australia was interested in effective action on human rights.

"The only way we believe that in our human rights diplomacy with China we can be remotely effective is by establishing some kind of dialogue," he said.

Australia had co-sponsored the resolution for six years without success.

"We don't believe it can achieve anything," Downer said.

Xiao's visit is the first major ministerial visit since a freeze on such gestures by China amid deteriorating relationships last year, and it signals the warming in relations sought by Howard on his Easter visit.

A visit by Xiao was cancelled after Howard defied clear warnings by Beijing about meeting the Dalai Lama during his visit here one of a series of events that upset China.

Amnesty International's Australian office said in a statement that China's human rights record had not improved since the 1989 Beijing massacre had prompted the original resolution.

It said Canberra appeared to be compromising Australia's past commitment to universal human rights for the sake of business relations.

"The fact is that the massive level of human rights violations in China is not good for business," Amnesty said.

Opposition foreign affairs spokesman Laurie Brereton said the about-face on the UN resolution would be warmly welcomed by the Communist hardliners in Beijing.

"Tragically a behind-closed-door dialogue may be just what the Chinese leadership want to ensure they are never bothered by open Australian criticism of their abysmal human rights performance," he said.

Downer said the dialogue process would cover general issues such as the Hong Kong handover, Tibet and political freedom, as well as individual cases like jailed Australian businessman James Peng.

Australia would also offer China assistance in areas such as legal reform, legal education and prison administration.

"While there will inevitably be differences between Australia and China on human rights issues, a formal bilateral dialogue will provide a framework for dealing with such differences and for pursuing concrete improvements in the observance of internationally recognised human rights standards in China," he said in a statement.

Chinese Foreign Ministry spokesman Shen Guofang said he hoped for a more formal statement by the Australian government but added he believed the decision to desist co-authoring the resolution was a wise one.

"We would like to welcome it and express our approval," he said in a press conference in Beijing.

Shen also also said Howard's recent visit emphasised dialogue on the basis of equality rather than confrontation.