BEIJING (Reuters) - China’s central government has approved a plan to extend a rural land reform pilot program by another year to the end of 2018, the Economic Information Daily reported on Tuesday citing sources at the Ministry of Land and Resources.

The land ministry’s pilot started in 2015 and is meant to develop mechanisms for rural land use rights to be transferred on markets, allowing rural residents to receive more of the benefits from their rights to land.

China has been looking to reform landholding rights for rural citizens for years as it promotes urbanization and more efficient, large-scale farms, though progress has been slow and there has been some resistance at the local level.

“We think the main reason for the extension concern issues regarding the revision of land administration laws, indicating the central government’s wariness of conflict with local governments when implementing the reforms,” analysts at Sun Hung Kai Financial said in a research note.

Farmers in China hold the long-term rights to small plots of land, but technically can lose the right to that land if they move away or do not actively cultivate the land.

Many have been informally leasing the rights to the land, though a lack of clear rules governing land rights has hampered the development of a healthy market for farmland.

Photo: REUTERS/Sheng Li

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