China has approved a massive infrastructure package worth more than 1.0 trillion yuan ($158 billion), state media said on Friday, as the government seeks to boost the flagging economy.
The top economic planner, the National Development and Reform Commission, this week announced approval of 55 infrastructure projects ranging from subway lines to highways, reports said.
The China Securities Journal said the 1.0 trillion yuan figure was a "conservative estimate" for spending on projects announced Wednesday and Thursday.
The government needed to open more funding channels for infrastructure, including allowing banks to relax controls on credit for projects, the newspaper quoted unnamed industry sources as saying.
The official Xinhua news agency described the package of projects as a "stimulus plan" though the government did not use that term when announcing the approvals.
On Wednesday, the commission announced it had approved 25 new urban railway projects, in what analysts said was a sign the government is ramping up government spending to boost the country's weak economy.
It said the projects, including subways and light railways in 18 cities across China, were valued at more than 800 billion yuan.
The commission on Thursday also unveiled another 30 infrastructure works -- including 13 highway projects, 10 waste treatment projects and seven port or waterway projects -- but gave no value.
The news sparked a rally on China's stock market on Friday with the benchmark Shanghai Composite Index closing up 3.70 percent on gains in building material and construction shares.
Analysts said the government spending could boost the country's economic growth from the fourth quarter of this year.
"Implementation of these projects will begin in the coming months, which will cause fixed asset investment growth to rise," Zhang Zhiwei, chief China economist for Nomura, said in a research note on Friday.
"The impact should start to be reflected in GDP (gross domestic product) numbers in Q4 2012."
He estimated future spending on recently approved infrastructure projects at 1.0 trillion yuan, equivalent to just over two percent of 2011 GDP, and added it would be invested over five years.
But China has so far refrained from equalling the massive 4.0 trillion yuan fiscal stimulus package it launched in the wake of the global financial crisis in 2008.
China's economy has eased markedly over the past year, expanding 7.6 percent in the second quarter of 2012, the worst performance in three years.
The government has set a target for economic growth of 7.5 percent for this year, down from actual growth of 9.3 percent last year.
Securities house UBS on Friday cut its China growth forecast for 2012 to 7.5 percent, from the previous 8.0 percent, citing delayed government support.
"In recent months, economic activity has remained weak as export growth slowed. Policy support was not as rapid or aggressive as previously envisaged," economist Wang Tao said in a report.