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Chinese capital Beijing will this year provide subsidies totaling 1.3 billion yuan (about US$166 million) to bus companies, which are offering across-the-board discounts to over nine million commuters in the capital, according to the municipal transportation authority.

The measure will give public transit a distinct price advantage, encourage people to use the public transit system and help ease the city's traffic gridlock, said Li Jianguo, deputy director of the municipal transportation committee.

He added that government's total investment in public transit will reach four billion yuan (about US$511 million) in 2007.

After Beijing axed bus rates at the beginning of this year, commuters have seen a remarkable drop in their public transport budgets. With discounts as high as 80 percent, a bus ticket now sells for only 20 to 60 cents.

According to a survey by Capital View Research Co. Ltd, 80 percent of the 168 interviewees said they are more willing to take the bus since the price cut.

But sources at bus companies said the number of passengers has not increased remarkably in the past ten days, and a price incentive is only the first step in trying to turn commuters away from using private cars.

Convenience, punctuality and the overall quality of the bus service also influence people's decision whether or not to take buses, said Shi Qixin, an expert in urban transportation planning.

Meanwhile, more bus lanes and transit hubs need to be built to improve public transit in the city, added Shi.

The city spent 11.67 billion yuan (about US$1.5 billion) last year on improving and expanding roads, subways and other road facilities. Investment in Beijing's public transport will total 71.5 billion yuan (about US$9.14 billion) by 2010.

Although it may take time for the subsidies and investment to pay off, Beijing's "buses first" policy has become a way of coping with the city's traffic problems, a major concern with the Olympic Games less than two years away.

"The policy will incite people to commute by bus, a good, green, environment-friendly choice," said Ren Hai, director of the Olympics Research Center under the General Administration of Sport of China.

According to government statistics, Beijing had 2.87 million motor vehicles at the end of 2006, an increment of 370,000 on the previous year. The figure is expected to swell by 32 percent to about 3.8 million in 2010.