NDRC pushes for private investment

China's top economic planner announced on Wednesday a list of 80 major infrastructure projects in which private investment will be invited to participate, including projects in areas such as transportation, information technology and clean energy.

The list, published on the website of the National Development and Reform Commission (NDRC), covers -projects in sectors such as railways, roads, wind power stations and gas pipelines, which used to be off limits to private investment.

The NDRC announcement came after Premier Li Keqiang said at a State Council meeting last month that China would allow more private participation in infrastructure projects.

"Private investment will be encouraged in the form of sole proprietorship, joint ventures or franchise operation," the NDRC said in the statement.

Plus, infrastructure projects that are not in the list but are beneficial to the country's economic restructuring should also be further opened up to private capital, the NDRC said.

The 80 projects involve assets owned by major State-owned companies such as oil giants China National Petroleum Corporation (CNPC) and China Petrochemical Corporation, as well as telecom firms China Mobile, China Telecom and China Unicom.

On May 12, PetroChina, the listed arm of CNPC, announced that it would sell some of its interest in the first and second west-east natural gas transmission pipelines through a public tender.

The NDRC list showed that the third west-east natural gas transmission pipeline will also be opened to private capital.

Chen Yao, director of the Institute of Industrial Economics at the Chinese Academy of Social Sciences, noted that the list is very specific and has shown the government's determination to push reform in these areas.

Chen noted that to ensure greater participation of private capital, private investors should be treated equally with State-owned companies.

The release of the list comes at a time when China's economy has been cooling, with GDP growth slowing to 7.4 percent in the first quarter. And given the slump in major industries such as the real estate sector, some have expressed concerns that China's economy may slow further.

Experts said that greater participation of the private sector could bring vitality to China's economy.

"Dividends from reform will be the major driving force for the future development of China's economy," Chen said, noting that encouraging private participation in infrastructure can also benefit China's economic restructuring.

A total of 36 projects announced by the NDRC were in the clean energy sector, among which solar power accounted for 30 projects, and 24 projects were in the transportation sector.

Construction of the country's 4G network will also be opened up to private investment, according to the NDRC list.

Tian Yun, an economist at the NDRC's China Society of Macroeconomics, noted that local investment used to rely heavily on government funding, which is unsustainable. "There is still plenty room for investment in China's infrastructure. Private funding should be introduced instead."

Tian told the Global Times that significant potential returns will be vital in attracting private capital to invest.

A report by finance portal yicai.com on Wednesday quoted a government official as saying that the 80 listed projects have great potential for future returns.