The Ministry of Land and Resources (MLR) will try to ensure "timely" land supply to match the central government's 4-trillion-yuan ($586 billion) stimulus package to increase domestic demand and boost the economy, top land officials said on Thursday.

This is an important step because it comes amid a tightening land policy given the shrinking area of arable land in the country.

The central government's stimulus package includes massive projects to build low-income housing units, improve rural infrastructure, electricity supply and transport networks, provide safe drinking water and protect the environment.

All the projects need land, said Lu Xinshe, deputy minister of land and resources. The MLR will expedite the revision of its national land use planning to ensure timely land supply for major projects.

"The MLR will adjust the land use plan for this year and next," Lu said in an online interview with Xinhua on Thursday. And it will make the approval procedure for the projects easier so that they can be passed in less time.

Though arable land will still be protected, he said, farmers whose land is acquired for a development project necessitated by the stimulus package should get fair compensation.

Lu's remarks have come as a relief for developers, who were worried over limited land supply for new projects because of tighter land supply quota norms, observers said.

"The supply of land will ensure a smooth development of the housing and infrastructure sectors," said Hu Chengguang, a real estate firm staff in Beijing.

The arable land area had fallen to 1.826 billion mu (121.73 million hectares) by the end of 2007 because of the country's fast urbanization and industrialization drive. A national land use plan, released recently, says the arable land quota would fall further, to about 1.805 billion mu, by 2020.

While almost half of the new urban construction projects are on farmland, the 21 million mu quota means tighter land supply in the next 12 years.

Every part of the stimulus package needs land, especially those on rural infrastructure, including roads, railways and airports, said an MLR planning bureau official surnamed Liu.

But since most of the projects in the package have already been planned, it means there will not be a big increase in the demand for land, he said.

However, experts still urged the land watchdog to monitor local governments' moves closely so that they do not allow non-farm industries to acquire excessive plots.

"Effective control and management should be maintained during the whole process," said Kong Xiangbin, professor in land management with China Agriculture University.

(China Daily?November 14, 2008)