China's GDP growth target for 2014 set at 7.5 percent

Infographic: Five key words from Li's govt report

The State Council also announced reform measures to back up the urban redevelopment program for run-down areas, in an apparent effort to prop up investments.

For the first time, the nation will establish a special institution under China Development Bank, a policy bank, to conduct independent accounting and empowered to issue special bonds to finance government-subsidized housing projects. Commercial banks, pension funds and insurance companies are encouraged to buy the bonds.

China will also deepen investment reforms in the railway sector, according to the statement.

Reform measures include the setup of a long-awaited railway development fund, more types of railway financing bonds and greater participation of private capital.

Chen, the analyst, said both the redevelopment and railway investment reforms aim to boost fixed-asset investment, a key engine of the nation's growth. He noted that since the fourth quarter of 2013, railway investment has risen steadily in the government investment mix.

"As property investment fell and the manufacturing sector was plagued by excessive capacity, investment in infrastructure became key for the central government," he said.

Investment in property, manufacturing and infrastructure are the three major components of China's fixed-asset investment picture.

Xie Yaxuan, head of macroeconomic research with China Merchants Securities, said the government intends to prop up the economy through reforms, rather than by the traditional means of eased monetary policy and progressive fiscal policy.

zhengyangpeng@chinadaily.com.cn

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