China steps on gas pedal to avert sharper slowdown

Li called for timely launch of major infrastructure projects in transportation, water conservation and urban underground pipe networks in northeastern China with the support of policy-backed financial institutions.

Chinese authorities also decided to relax mortgage rules for second home buyers last month to address demand for improved housing and lift the sagging market.

Despite a slight economic slowdown, China still has a string of policy tools at the government's disposal to bolster economic growth, aiming to achieve a better-quality economic development, Li said last month at a press conference after the conclusion of the annual parliamentary session.

A list of economic data is scheduled to be released on Wednesday. The Chinese government still has many fiscal, monetary and structural reform policies in its toolkit to spur growth and restructuring, if upcoming data were significantly subpar, analysts projected.

JP Morgan China chief economist Zhu Haibin predicted further policy easing in China, including a cut in the RRR by 50 basis points later this month and a benchmark interest rate cut by 25 basis points in June.

Apart from those short-term moves to stabilize growth, priority should be given to ensure current pro-growth moves will not undermine long-term efforts of restructuring and fostering innovation.

"Less focus should be given to the high-polluting and outdated industries including steel and cement like the past decade, while more efforts should be laid on industrial upgrades and environmental protection in northeastern China," said Sun Hao, an expert with Heilongjiang Provincial Academy of Social Sciences.

Innovation will not come from government planning, but from streamlining administration and delegating powers to allow easier market access and less governmental interference, said Li Xi, provincial head of Liaoning.