The UK government is planning to set up a police cyber crime unit as part of its efforts to tackle the threat from criminal gangs, hostile states, "hactivists" and terrorists.

The new cyber crime unit dubbed, “i-Plods” will be set up as part of a £650m plan to combat cyber crime in the UK and protect internet users. Security analysts say that one of the biggest threat comes from Chinese cyber warriors, who are behind stealing industrial secrets from European companies.

The Cyber Crime Unit will be operational by 2013, according to Cabinet Office minister Francis Maude, who said that the unit will be a part of the National Crime Agency and builds on the Metropolitan Police force's eCrime Unit.

Maude added: "We will also ensure that the police use existing powers to ensure that cyber criminals are appropriately sanctioned."

A joint cyber unit at GCHQ will also work to develop the county’s capabilities in cyberspace. Some of the technological capabilities developed at the Government’s GCHQ eavesdropping centre will be offered to private industry as part of new cyber security strategy that was revealed on Friday.

Ministers said that commercializing development will not affect national security and that will remain the main focus of the centre. The new strategy states that the collaboration between the two sectors is important to combat cyber crime.