The new AUKUS pact will allow the UK and US to share top secret nuclear-propulsion technology for a fleet of at least eight submarines.

Construction is expected to start later this decade and the first boats in the water before 2040.

China reacted angrily with foreign ministry spokesman Zhao Lijian describing the decision as extremely irresponsible.

He said it intensified the arms race and undermined international non-proliferation agreements.

Chinese Communist Party-controlled tabloid The Global Times wrote Australia was now a potential target for a nuclear strike because China and Russia faced threats from the submarines.

"Australian troops are also most likely to be the first batch of Western soldiers to waste their lives in the South China Sea," the state newspaper said.

Prime Minister Scott Morrison denied the pact risked provoking a military conflict with China.

"I don't think that sort of language actually helps promote peace and stability," he said of The Global Times.

The prime minister said he didn't share Mr Zhao's views, nor did other countries in the region.

"This is seen as a positive move that contributes to peace and stability," Mr Morrison said.

"All countries will invest in their own defence capabilities, and, indeed, China does in theirs."

He would not be drawn on claims the submarines would make Australia a nuclear target.

Defence Minister Peter Dutton labelled China's reaction as propaganda which strengthened the case for Australia's decision.

"Their comments are counterproductive and immature, and frankly embarrassing," he told Sky News from the US.

Mr Zhao said the decision intensified the arms race and undermined international non-proliferation agreements.

"The export of highly sensitive nuclear submarine technology to Australia by the US and the UK proves once again that they are using nuclear exports as a tool for geopolitical game and adopting double standards," he said.

"This is extremely irresponsible."

Mr Zhao said he was not aware of an open invitation Mr Morrison said he had extended to Chinese President Xi Jinping to discuss the arrangement.

But the foreign ministry official said Australia, the UK and US should abandon a "Cold War zero-sum mentality" and do more for regional peace.

"Otherwise, they will only end up shooting themselves in the foot."

US Secretary of State Antony Blinken said the world had seen China's aggressive response to calls for an inquiry into the origins of coronavirus.

"Beijing has seen over the past months that Australia will not back down, and threats of economic retaliation and pressure will not work," he told reporters in Washington.

The decision to scrap a $90 billion deal with a French company for 12 conventionally powered submarines has also angered Paris.

"I appreciate that that is a disappointing decision for France, who are our great friends," Mr Morrison told the Nine Network.

"But you've always got to ... take the decisions that are in Australia's national interests."

Australian Associated Press