The Three Gorges Dam in Yichang, Hubei province. The government will allow private investors to buy special licenses or take stakes in water projects. [Provided to China Daily]

China, which boosted its water investment budget by 7 percent this year, plans to use financial enticements to attract private capital to major water projects.

The nation will encourage investment by allowing private investors to buy special licenses or take stakes in water projects, Zhang Minglun, deputy head of the investment division under the National Development and Reform Commission, said on Tuesday at a briefing in Beijing, according to a transcript posted on the website of china.com.cn.

The government plans to prioritize investment support on projects that have private investors by injecting capital and offering subsidies or loans with preferential terms, Zhang said. China will also improve how water project prices are set, he said.

China plans to start construction of 172 major water projects by 2020. Total investment on projects currently being built could amount to about 600 billion yuan ($98 billion), Zhang said.

The government has arranged an investment budget of 76.7 billion yuan for water projects this year, said Li Pumin, spokesman for the NDRC, China's top economic planning agency.

Zhang also said that the central government's investment project approvals will go down by 40 percent if an updated catalog is put into practice.

The catalog, based on the 2013 edition, incorporates two major changes, said Zhang.

The first change by the country's top economic planner will see 15 types of projects delisted from the catalog. Most will be delisted because they will no longer need government approvals. These include investments in areas such as urban road, water supply and fertilizers, and most investment overseas were removed from the approval list.

Second, the central government will delegate approvals to local governments, including 23 kinds of projects such as construction of an electricity grid within a province.

"The latest catalog on investment projects subject to government approvals has been passed by the State Council. Next, we will further improve it before sending it to the State Council for implementation," said Zhang.

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