The fourth-generation mobile communications network and the Internet of Things, which connect various devices through chips and sensors, have been identified as national strategic industries, industry regulators said Tuesday.

The gross domestic product of the strategic industries, which also include new-energy cars and new materials, is expected to contribute 8 percent to the country's overall GDP by 2015 and 15 percent by 2020, according to the State Council, China's Cabinet.

Funding and favorable policies are expected to boost the strategic industries, industry insiders said.

The new strategic industries will propel the country from traditional manufacturing to more high value-added and innovative production.

The Chinese economy needs to be more efficient, said Wu Jinglian, a researcher at the Development Research Center of the State Council.

"High GDP growth requires a huge investment in capital and labor resources, as well as a reduction of environmental pollution," Wu said. "Therefore, the current efficiency is not acceptable. China has to change the economy structure."

The 4G network, which is 20 times faster than 3G and used in several overseas cities, is being tested at the World Expo site in Shanghai. China Mobile, the world's No. 1 telco, will test the 4G network in 10 cities nationwide next year, said Wang Jianzhou, chairman of the firm.

Shanghai has also drafted a plan to develop nine strategic sectors, including 4G and the Internet of Things.