The historic Yangtze River will be the center stage of China's grand plan to develop an economic belt that will usher in a balanced regional growth.

The planned Yangtze River economic belt will cover the provinces of Jiangsu, Jiangxi, Shanghai, Hubei, Chongqing, Anhui and Hunan. Two municipalities--Sichuan and Yunnan-are also included.

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These provinces generate some 40 percent of the gross domestic product.

Premier Li Keqiang elaborated in his report to the annual session of the National People's Congress (NPC) how China can exploit the river's maximum potential by developing an economic hub along its banks.

Plans to encourage and convince businesses to relocate from crowded coastal areas to major roads and rivers are underway, Li said.

Gu Shengzu, an economist and NPC deputy, said there are numerous ways to realize the plan to transform the Yangtze River into an economic belt.

"Different economic policies will be applied in different localities to encourage industrial transfer and to help nurture new regional economic growth poles. The economic belt will connect all major cities in the upper, middle and lower reaches of the Yangtze," said Gu.

"More than three decades after opening up coastal regions, the announcement is a significant step toward an economic belt stretching all the way from the eastern coast to the inland mountains in the west," Gu added.

Gu said the plan to transform the Yangtze River into an economic belt is a wise and practical decision if China does not want to lose its businesses to Southeast Asian countries.

"Transforming the growth model and promoting economic transfer are great incentives for manufacturing plants along the coast to relocate inland. Rising production costs, especially labor costs, mean many companies have chosen to move their plants to Southeast Asian countries. If the government does nothing to stem this process, central and western regions may remain undeveloped and balanced regional growth hard to achieve," said Gu.

"The Yangtze River economic belt will bring us more opportunities to expand regional cooperation," said Chen Zhongwei, head of Chengdu's logistics office.