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Beijing will draw up a strategic blueprint to re-develop the old industrial belt in the northeast at a high-level meeting in October, according to government sources.

Sources in Beijing said the Third Plenum of the Communist Party of China's 16th Central Committee, to be held in the capital, may introduce a policy package to push ahead with the ambitious re-industrialization campaign.

The official Xinhua News Agency reported on Monday that the plenum will discuss the ways "to further improve China's socialist market economic system" and deepen economic restructuring.

In preparation for the policy, a group of leading researchers from the Development Research Centre of the State Council, the government's top think tank, is studying Northeast China's revitalization.

The sources said the team was expected to compile a comprehensive report on ways to address the region's inherited problems, improve government function and foster new economic growth areas.

Earlier, the State Development and Reform Commission completed a separate report focusing on reviving local industry through policy support.

The high-profile bid to "rejuvenate the northeast" has been billed as another strategically significant move following the "Go West" policy introduced in 1999, to develop the vast western region.

The northeast region, which stretches across Liaoning, Jilin and Heilongjiang provinces, used to be China's industrial base and was seen as a role model under a planned economy in the early years of the founding of the People's Republic of China in 1949.

At the time, the gross domestic product (GDP) and industrial output of the three provinces accounted for 40 per cent and 16.7 per cent respectively of the country's total.

But the region's economic significance gradually eroded mainly due to the country's transition to a market economy in the wake of the reform and opening-up drive initiated by the late leader Deng Xiaoping in the 1970s.

Later, the region was overshadowed by the fast-developing coastal provinces in the eastern and southeastern regions.

On August 4, Premier Wen Jiabao convened a meeting in Changchun, capital of Jilin Province, to unveil the campaign, which he said would help promote co-ordinated development of regional economies.

The premier called for "new thought, new systems, new mechanisms and new methods" to speed up the rejuvenation of old industrial production bases in the region.

This move has given rise to great hopes that the northeast region could be transformed into becoming the country's fourth economic powerhouse alongside the booming Pearl River Delta, Yangtze River Delta, and Bohai Rim, including Beijing and Tianjin.

Song Donglin, vice-president of the School of Economics at Jilin University, said there were advantages and disadvantages in the northeast.

As the old industrial production base, the region is saddled with ageing machinery and an historical burden.

Although a number of top State-owned enterprises such as Anshan Steel, Daqing Oil Field and Fushun Coal Mine are based in the region, there are millions of jobless and laid off workers.

Moreover, local governments, enterprises and individuals still cling to an outdated planned-economy mentality characterized by unquestioning adherence to authority and rejection of business.

On the other hand, Song said, the three provinces were blessed with an abundance of natural resources including coal and oil, and was known as China's "northern granary".

At the same time, "an overall modern industrial network has been set up in the region, with Liaoning concentrating on manufacturing, Jilin on the auto industry, and Heilongjiang on the power industry", he said.

Song said the central government should offer more policy and financial support to the region, and help adjust its energy-dependent development model.

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