China’s infrastructure buildup to play bigger role for investment in coming months: expert

A drone photo taken on March 6, 2025 shows the closed Heyuancun Grand Bridge of Baotou-Yinchuan High-speed Railway in north China's Inner Mongolia Autonomous Region. The Heyuancun Grand Bridge was successfully closed on Thursday, marking the completion of the bridges and tunnels within the Inner Mongolia section of Baotou-Yinchuan High-speed Railway, which links Baotou in Inner Mongolia and Yinchuan in northwest China's Ningxia Hui Autonomous Region. (Photo: Xinhua)

A number of major projects have made fresh progress recently, highlighting a potential acceleration in the country's infrastructure buildup and supporting overall investment, Chinese experts pointed out on Sunday.

The first railway tunnel across the Helan Mountain in Northwest China's Ningxia Hui Autonomous Region was completed on Saturday, according to a statement sent to the Global Times by China Railway Group, contractor of the project, on Sunday.

The 8,792-meter tunnel is an important part of the Baotou-Yinchuan high-speed railway, a key component of China's national high-speed railway network, according to China Railway Group.

In Jinan, East China's Shandong Province, the world's largest-diameter underwater shield tunnel completed an excavation project under the Yellow River on Sunday when the Shanhe tunnel boring machine with a diameter of 17.5 meters finished its mission, a milestone in the project's construction, stdaily.com reported.

During the January-July period, fixed-asset investment in the railway sector reached 433 billion yuan ($60.3 billion), China State Railway Group said on Saturday.

With a growth rate of 5.6 percent year-on-year, the sector's investment has injected new growth momentum to the country's steady economic recovery, the railway operator said.

Adding to the list of recent infrastructure projects, ground was broken for a pithead coal-fired plant on Friday in Northwest China's Xinjiang Uygur Autonomous Region, local news portal ts.cn reported on Sunday. The project, with a total investment of 17.3 billion yuan, is a key energy project in the autonomous region and will generate 20 billion kilowatt hours of electricity a year.

China's fixed-asset investment scaled up in the first seven months of 2025, with fast-growing capital flowing into manufacturing, according to data released on Friday by the National Bureau of Statistics (NBS). Total investment rose 1.6 percent year-on-year to more than 28.82 trillion yuan, the NBS said.

Investment in the manufacturing sector increased 6.2 percent year-on-year, while investment in infrastructure construction grew by 3.2 percent, according to NBS data.

However, overall fixed-asset investment growth was 1.2 percentage points lower than in the January-June period.

Infrastructure investment is expected to accelerate in the remaining months of this year, as part of efforts to boost economic growth amid external pressure, and this will further highlight infrastructure investment's role as a macroeconomic stabilizer, Wang Qing, chief macroeconomic analyst at Golden Credit Rating International, told the Global Times on Sunday.

Infrastructure investment growth rate in 2025 is projected to be significantly higher than that of last year, according to Wang.

Government-led investment has continued to strengthen, with a cumulative year-on-year increase of 31.9 percent in project bid amounts, a leading indicator, from January to July, the Economic Information Daily reported on August 13, citing data from the State Information Center.

Construction intensity has also seen marginal improvement, with the July construction machinery operating rate rising 0.7 percentage points from the previous month, the report said. The operating rate of petroleum asphalt plants, a leading indicator for road construction activity, recorded both month-on-month and year-on-year increases for four consecutive months.

According to the meeting of the Political Bureau of the Communist Party of China Central Committee held at the end of July, which set the tone for the country's economic policy approach in the second half of the year, macro policies should be intensified in a sustained and timely manner. It urged rigorous implementation of a more proactive fiscal policy and a moderately loose monetary policy to strengthen their effectiveness, according to Xinhua.

Analysts predicted that infrastructure investment growth will further accelerate in the coming months, driven by favorable conditions such as a plentiful project pipeline and the accelerated issuance of funds such as special bonds.

Li Changan, a professor at the Academy of China Open Economy Studies at the University of International Business and Economics, told the Global Times on Sunday that with more projects entering the construction phase and generating a concrete workload in the remaining months of 2025, including a number of mega infrastructure projects, infrastructure investment will play a larger role in beefing up overall investment in the country.

"Driven by supportive policies, non-real estate investment is expected to expand at a steady pace. Infrastructure investment will continue to play a supporting role, benefiting from the issuance of special government bonds and local government special bonds and the continued injection of funds. The growth rate of infrastructure investment is expected to expand throughout the year," Lian Ping, director and chief economist of the Guangkai Chief Industry Research Institute, told the Global Times on Sunday.