The government will also lure private investment into strategic emerging industries by setting up industrial investment funds, according to the report.
Nur Bekri, head of the National Energy Administration, told the newspaper the reform plan of the oil and gas industry had gained government approval and would soon be released. The sector will open its competitive operations to private investment as per this year's government work report.
“Access restriction is one of the major factors that constrain China’s private investment, especially in the energy and military industries,” said Li Wei, head of the Development Research Centre of the State Council.
Private investment is even encouraged in the defence science and technology industries, including China’s Chang’e-4 lunar probe mission, which aims to make mankind's first soft landing on the far side of the moon around 2018.
“Widening access for private capital to enter these industries, together with improved regulation, will both boost development efficiency and stimulate private investment growth,” Li said.
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Growth in private investment slowed to 3.2 percent year on year in 2016, 6.9 percentage points lower than in 2015, due to poor performance in manufacturing, service and mining sectors, as well as continued price decline of investment in fixed assets.
But the downward trend was reversed after the government moved to spur growth, with private investment recording growth of 6.7 percent in the first two months of the year.
China's local governments are also working to attract private capital into cash-strapped strategic emerging industries, which have found it difficult to get bank loans as many start-ups are yet to turn patents and intellectual property into profits.
As these industries have now become major growth engines in many regions, local governments are considering ways of luring private investment such as public-private partnerships and industrial investment funds, according to the report.
Government-led industrial investment funds are expected to play a guiding role in leading private capital into the strategic emerging industries.
China aims to increase output of strategic emerging industries to account for 15 percent of GDP by 2020.