China announced on Friday a pilot program, allowing the trade of rural land use rights for stakes in farming entities.
The pilot program will be run in three experimental rural reform regions in Jiangsu, Sichuan and Guizhou, and four counties in Heilongjiang, Shandong, Zhejiang and Chongqing Municipality, the Ministry of Agriculture said in a statement.
There are two kinds of land ownership in China - urban land is owned by the state and rural land is normally under collective ownership. Farmers are part of the collective community and enjoy land use rights, but with restrictions.
Under the pilot scheme, farmers will be allowed to turn their land-use rights into shares in farming enterprises or cooperative societies, according to the statement.
The ministry has ordered local governments in the seven chosen localities to submit detailed plans before May.
It urged protecting farmers' rights and interests during the reform.
