China yesterday kicked off a massive infrastructure project worth 500 billion yuan ($79.8 billion) in its northwest province of Gansu, which will be part of its ambitious Silk Road development to facilitate trade and people exchanges between China and the countries of Central Asia.
The project involves construction of over 60,000 km of road, including 4,070 km of expressways, to improve the connectivity of existing transportation network, Xinhua, the state-run Chinese news agency reported yesterday.
Although the provincial authorities have not revealed the funding source, Xinhua said that the project will be funded by the local government's investment vehicle and central government funds.
Though the Gansu province does not share its borders with any central Asian countries, it will be an important stretch of the Silk Road Economic Belt, the report said.
The infrastructure development in the Gansu province will also include construction of 12 additional civilian airports in the next six years, which will provide air service to about 82 per cent of the province's population.
The Chinese government has approved a series of infrastructure projects since the third quarter to improve regional connectivity as the country's economy is facing a downward pressure.
It also launched a $40-billion fund backed by the country's foreign reserves to support infrastructure building in countries along the Silk Road Economic Belt and the 21st Century Maritime Silk Road.
The ambitious Silk Road project is expected to connect regions of Asia with Europe and Africa reviving the ancient trade routes through land and sea.
China has invited India to take part in the Bangladesh, China, India, Myanmar (BCIM) and the Maritime Silk Road (MSR). Although India is taking part in BCIM meetings, it is yet to give its response on MSR.
According to recent reports, the Chinese economy is likely to slow down to 7 per cent in the first quarter from 7.3 per cent in the December quarter.
On Saturday, the People's Bank of China unexpectedly cut interest rates by a quarter of cent at the weekend to spur economic growth.
January's official figures showed a purchase manager's index of 49.8 indicating a slight contraction while for February, the HSBC index showed 50.7, the strongest level in seven months, signalling an expansion in factory activity.
However, export orders shrank and deflationary pressures persisted, according to the survey.