BEIJING -- The State Council has approved a pilot plan to open up Beijing's service industry by removing more restrictions in the sector.

The pilot will last for three years and aims to modernize and upgrade the capital's service sector, the State Council said.

The plan highlights reform in major areas, including services in science and technology, Internet and communication, culture and education as well as finance and tourism.

Local authorities will ease investment restrictions, allow more foreign capital, streamline regulations and encourage innovation, according to the plan.

China has been trying to shift its economy toward a growth model that draws strength from consumption, services and innovation. The service sector accounted for more than half of the Chinese economy last year.

The figure, however, is well below the average level of 57 percent among middle-income economies, let alone the 74-percent level for developed countries.

For Beijing alone, the added value of its service sector was around 2 trillion yuan ($292 billion) last year. The sector accounted for 80.3 percent of local GDP. About $12.3 billion of foreign investment was used in the sector.