China to allow land transfer under new rural land reforms

China has initiated a new set of land reforms changing the 30-year-old system to permit transfer of land rights to individuals or conglomerates, a politically sensitive move as the Communist country embarked on urban expansion shedding its agrarian past.
"Formally a grey area, farmers are now officially allowed to transfer their land rights to individuals or conglomerates, which will not only make use of idle land but will also help catapult farming into the modern age, one with greater returns and higher incomes for those that work or lease the land," state-run Xinhua news agency reported today, highlighting the new set of guidelines.

Guidelines issued on Sunday called for the separation of farmland ownership rights, contract rights, and operating rights, which allows farmers to retain the rights to their allotted land if they choose to lease the land out to others, the report said.
The new set of land reforms replaces the household responsibility system (HRS) which was put in place in early 1980s by the ruling Communist Party of China, (CPC) after discarding party founder, Mao Zedong's people's commune system of the late 1950s.
The people's commune system which has completely abolished feudal ownership of land and redistributed the land to individual farm households under socialist system has been replaced after catastrophic fall in agricultural production resulting in heavy food shortages.

The HRS, while continuing with the collective ownership of farmland, introduced a system contracting farmland to individual households.

It also permitted farmers to decide what and how much they grow on their land.
Significantly, the new set of land reforms permitting land rights to individuals and conglomerates to expand urbanisation drive was announced after the recent plenary session of CPC in which President Xi Jinping, who is also the general secretary of the party and head of the military has been declared as "core leader", a leadership status previously conferred on Mao, reformist leader Deng Xiaoping and his successor, Jiang Zemin.

In its report on the new land reforms, the Xinhua said "the question of how to efficiently exploit farmland remains a pressing issue in the world's most populous country, where food security and the well-being of rural residents are high priorities."
Land in rural areas are in much demand in China as it transforms from an agrarian country to that of an industrialised urban hub.
China's urban dwellers over took rural population in 2012. The urban population totalled to 51. 27 per cent of the China's entire population of nearly 1.35 billion or 690.8 million people that year according to the country's National Bureau of Statistics (NBS).

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Hailing the new land reforms, Li Guoxiang, researcher at the Rural Development Institute of the Chinese Academy of Social Sciences said it is the biggest change in the rural economy since the HRS and Sunday's guidelines will help standardise the practice as a whole.
HRS allowed rural households to lease land for independent operation. After paying a fixed fee to the government, they could dispose of surplus production to the market.
While this was the correct move at the time, the times have changed and demand for large-scale and professional farming has exploded in recent years, he said.

"The separation of ownership rights, contract rights, and operating rights will improve land circulation, increase farmers' incomes, and help modernise agriculture," Li told Xinhua.
The separation of the three rights means that the operating rights will now be of equal importance as the other two rights, a big step in protecting the interests of farmland operators, Li said.
"I expect more specific policies in the pipeline that will benefit the companies using the transferred land," he said.