Tax fight sends GOP into chaos

The main thing that has held Republicans together philosophically is the belief in holding down taxes. Not one of them in Congress has voted for a significant increase in more than two decades.

Now that very issue is tearing the GOP apart and making it an all-but-ungovernable majority for Speaker John A. Boehner (R-Ohio) to lead in the House.

Disarray is a word much overused in politics. But it barely begins to describe the current state of chaos and incoherence as Republicans come to terms with electoral defeat and try to regroup against a year-end deadline to avert a fiscal crisis.

The presidential election was fought in large measure over the question of whether some Americans should pay more in taxes. Republicans lost that argument with the voters, who polls show are strongly in favor of raising rates for the wealthy.

But a sizable contingent within the GOP doesn’t see it that way and is unwilling to declare defeat on a tenet that so defines them. Nor are they prepared to settle for getting the best deal they can, as a means of avoiding the tax hikes on virtually everyone else that would take effect if no deal is reached.

When Boehner tried to bend even a little, by proposing to raise rates on income over $1 million, his party humiliated him, forcing him Thursday night to abruptly cancel a vote on his “Plan B.”

“We had a number of our members who just really didn’t want to be perceived as having raised taxes,” Boehner said Friday. “That was the real issue.”

Whether and how the party can resolve the issue has implications going forward. It could determine Boehner’s viability — even his survival— as leader of the only part of the federal government controlled by the Republicans.

It also could set the terms of engagement for the battles that lie ahead, including such contentious ones as immigration and the fiscal 2013 spending bills, which are funded for only half the year and which expire March 31.

As things stand now, some worry that nothing short of a catastrophe could force a resolution.

“We have sunk to the lowest common denominator in order to get a deal — sheer panic,” said Republican strategist Ron Bonjean, a former aide to House and Senate leadership. “The reality of a stock market crash is probably the only way Washington will strike a deal. It is probably the only scenario that could likely force the speaker’s hand and allow for a deal driven by Democratic votes to pass the House.”

Which, of course, is not an ideal way to govern.

“The hard-core anti-tax conservatives in the GOP seem to believe that Barack Obama will be blamed if there is no agreement reached to avoid sequestration and the tax increases that are coming,” said Sheldon D. Pollack, a University of Delaware law and political science professor who has written a history of Republican anti-tax policy. “Calculated gamble? Or are they simply incapable of recognizing that they do not control the White House or the Senate, and hence do not have the ability to control the agenda? Sadly, I think it is the latter.”

Their intransigence alone is unlikely to sell the electorate on the Republican point of view on taxes.

“You have to make an argument. You have to go out there and engage. You can’t just simply assert a position,” said GOP pollster David Winston, who advises the House leadership. “Part of the dynamic for Boehner is that he’s trying to have the debate over economic policies that should have occurred during the election, and he also has to deal with this piece of legislation.”

As long as there has been a Republican Party, there has been at least a faction within it that has taken a hard-line stance on taxes, Pollack said. But it has not always had the upper hand.

Abraham Lincoln, the first Republican president, was also the first to put a national income tax into place, as a temporary means of funding the Civil War. Even then, House Ways and Means Chairman Thaddeus Stevens (now enjoying a return to popular consciousness as Tommy Lee Jones’s character in the movie “Lincoln”) denounced the idea of a graduated rate structure as a “strange way to punish men because they are rich.”

The 16th Amendment, which established the constitutionality of the federal income tax in 1913, was proposed by a Republican, Senate Finance Committee Chairman Nelson W. Aldrich. But it was decried by another one, Sen. Henry Cabot Lodge of Massachusetts, as “confiscation of property under the guise of taxation” and “a pillage of a class.”

The divisions went on until the 1980 election of Ronald Reagan, who ran as an advocate of tax-cutting supply-side economics.

In 1990, Newt Gingrich established himself as the de facto head of his party in the House, when he stood up to a president of his own party and led the opposition to George H.W. Bush’s tax increases.

Gingrich insisted in an interview Friday that the Republicans still have leverage, if they are willing to fight hard enough.

“They need a strategy, not just a way of getting through this week,” he said.

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New diagnostic kit allows testing for ricin poisoning

SINGAPORE: A new diagnostic kit developed by Singapore's DSO National Laboratories and the Defence Science Technology Organisation (DSTO) in Australia will allow for the testing of a potent toxin, known as ricin, in humans.

Ricin is found in the common castor bean plant and oil produced from the plant is widely used industrially.

A dose as small as a few grains of salt can kill an adult human if it is inhaled or injected.

The danger of ricin poisoning lies in the symptoms exhibited, which are similar to common food poisoning or respiratory illness.

This makes the diagnosis of ricin poisoning particularly challenging.

Ricin has also been known to be used in biological warfare.

With the new kit, ricin poisoning can be immediately detected, by running human samples such blood and stools, through the kit.

"For this test, we only need 50 micro-litres of sample. That's probably equivalent to two drops if you do a fingerprick," said Chen Hsiao Ying, senior technical staff at the Defence, Medical & Environmental Research Institute.

A person can only be tested after ricin has been in the body for at least eight hours.

Current diagnostic kits can test for ricin contamination in food, soil or water, but not humans.

The new kit will be commercially available in two years' time.

- CNA/xq

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India to open its first drug inspection office in Beijing by Mar 1

NEW DELHI: Increasing the heat on Chinese drug firms exporting medicines to India, the Drug Controller General of India (DCGI) is all set to open its first foreign drug inspection office in Beijing by March 1.

Around four Indian drug inspectors will be posted in China to inspect manufacturing sites and check whether good manufacturing practices (GMP) are being complied with.

DCGI Dr G N Singh told TOI that the commerce ministry has cleared the proposal.

Health minister Ghulam Nabi Azad recently said that in the last two years, 10 Chinese bulk drug manufacturing firms were inspected and the registration certificate of one firm and 16 import licences were cancelled.

Ministry sources said the decision to audit Chinese drug manufacturing units was taken after several import licences of local agents were cancelled due to poor drug quality and their failure to comply with GMP.

"We will post Indian drug inspectors in China to send a clear message that Chinese drug firms are under watch. Gradually, China will be asked to only allow drugs exports from manufacturing sites that have been inspected by Indian drug inspectors. We want to ensure safety, efficacy and quality of Chinese drugs," said Dr Singh.

"GMP of Chinese drug firms has to be certified by our regulators. This is a practice followed in most countries, including the FDA in the US. To protect the interest of Indians, we have to go international," he added.

Now, more than 45% of bulk drug exporters registered in India are from China. The number of registered Chinese bulk drug manufacturers in India is around 280, and altogether 417 different drugs from the Asian giant are registered.

In 2009-10, the value of drugs imported from China stood at Rs 3,094.4 crore, while India's total drug import bill was Rs 4,953.87 crore.

The Planning Commission's working group for the 12th five year plan had said in its report that globalization has fundamentally changed the environment for regulating drug products and created unique regulatory challenges for the following reasons: more foreign manufacturing facilities supplying bulk drugs, medical devices, blood products, diagnostics and anti-cancer drugs to India, increasing volume of imported medicinal products and imports coming from countries with less developed regulatory system.

The document said, "It is therefore important that the Central Drugs Standards Control Organization should have India country offices, at least one each in five countries. Initially, such offices could be set up in China and South Africa to inspect foreign manufacturing facilities and address other regulatory issues. The offices in the other three countries could be set up on a need analysis basis. The financial outlay for each office would be Rs 175 crore."

The Indian pharmaceutical industry has been growing at a rate of 11%-12%. It is the third largest in the world by volume and 13th by value. The total size of the Indian pharma industry is about Rs 100,000 crore, out of which exports account for Rs 42,000 crore. It accounts for 8% of global production, and 2% of the world pharma market.

A ministry official said, "We had earlier written to Chinese Food and Drug Authority (FDA) regarding complaints that some Chinese drug firms which export bulk drugs to India might not be holding proper GMP certificates. The Chinese FDA too confirmed our apprehensions and asked us to carry out our own inspections."

On the basis of complaints and doubts on authenticity of GMP certificate, India has already cancelled 10 registration certificates and related import licences. These certificates were from Zhejinag, Jingsu, Henan province and Chongquing.

A DCGI note said, "Similarly, several cases of imported kits of HIV were declared to be not of standard quality by the government laboratory, which are originating from Zhejiang and Fujian provinces. These issues further support this office which stands to carry out foreign site inspections in line with other regulatory agencies of the world."

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Pictures: Fungi Get Into the Holiday Spirit

Photograph courtesy Stephanie Mounaud, J. Craig Venter Institute

Mounaud combined different fungi to create a Santa hat and spell out a holiday message.

Different fungal grow at different rates, so Mounaud's artwork rarely lasts for long. There's only a short window of time when they actually look like what they're suppose to.

"You do have to keep that in perspective when you're making these creations," she said.

For example, the A. flavus fungi that she used to write this message from Santa grows very quickly. "The next day, after looking at this plate, it didn't say 'Ho Ho Ho.' It said 'blah blah blah,'" Mounaud said.

The message also eventually turned green, which was the color she was initially after. "It was a really nice green, which is what I was hoping for. But yellow will do," she said.

The hat was particularly challenging. The fungus used to create it "was troubling because at different temperatures it grows differently. The pigment in this one forms at room temperature but this type of growth needed higher temperatures," Mounaud said.

Not all fungus will grow nicely together. For example, in the hat, "N. fischeri [the brim and ball] did not want to play nice with the P. marneffei [red part of hat] ... so they remained slightly separated."

Published December 21, 2012

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'Cliff' Deniers Put Faith in No Deal

Not everyone thinks the "fiscal cliff" is so bad.

If the Dec. 31 deadline passes, income taxes will go up and across-the-board spending cuts will hit government programs. But while most of the political world frets as if a major disaster is looming, others have treated it more like the Y2K bug: a fiscal canard ginning up a lot of unnecessary panic.

The cliff is a "fantasy," former House speaker Newt Gingrich told a sold-out crowd at the Ronald Reagan library in Simi Valley, Calif., a week before Election Day.

"It is an excuse to panic," Gingrich said. "It is a device to get all of us running down the road so we accept whatever Obama wants, because otherwise we will have failed the fiscal cliff, and how can you be a patriot if you don't do what the fiscal cliff requires?"

Fiscal Cliff 'Plan B' Is Dead: Now What?

The former speaker wanted Republicans to stop negotiating with President Obama, for fear of giving too much away. "Back out of all of this negotiating with Obama," Gingrich publicly advised House Republicans. "The president is overwhelmingly dominant in the news media" but, at the opposite end of the political spectrum, liberals have said the same thing for a similar reason.

Kevork Djansezian/Getty Images

Fiscal Cliff: Boehner Doesn't Have Votes for Plan B Watch Video

'Fiscal Cliff' Negotiations: Boehner's Plan B Watch Video

While the "cliff" would mean higher taxes on the middle class, it would also mean higher taxes on the wealthy, a chief demand for liberals. Automatic budget cuts would hit defense programs, which liberals have wanted to cut anyway, but not the Medicare and Social Security entitlements that Democrats and progressives want so badly to protect.

Boehner Pulls 'Plan B' Amid GOP Disarray

Van Jones, the environmental activist and resigned White House green jobs "czar," sought to quiet the "fiscal cliff" alarms Election Night on CNN. "The problem with the label 'the cliff' is that it creates a mindset that there is nothing worse that this set of cuts, and there are things that are worse," Jones said.

"We cannot be in a situation where we get bullied or stampeded into putting in a deal that's even worse than what the fiscal cliff is about."

Jones later wrote on his blog that the "fiscal cliff" is actually a "fiscal bluff": "The so-called fiscal cliff is actually a fiscal bluff --- a made-up crisis to make us think our government is out of money and time. Congress continues to drag its feet over raising taxes on the wealthiest Americans, despite the top 1% earning 23% of the nation's income, and insists on calling for cuts to vital programs instead of reining in massive subsidies ($100 billion in 2011 alone) to major corporations that already make billions in profits.

"America isn't broke --- it's being robbed.
Gingrich and Jones started the conversation, but as the deadline creeps closer, others are finishing it."

To some, the "fiscal cliff" offers a clearer upside.

"Democratic and progressive leverage goes immensely up if we get past the beginning of the year," Adam Green of the Progressive Change Campaign Committee told ABC News. "Once they have to proactively lower taxes on the rich, it makes it harder and harder to move that number up and makes it easier and easier to force votes or demand votes on policies that clearly benefit the middle class."

Green says liberals will get what they want immediately, if the Dec. 31 deadline passes without a deal.

"We really want to get past the first of the year so that we have that leverage in the bag," Green told ABC. "It will also show that the fiscal cliff was a mess. If we get into 2013, the really good stuff happens right away, and the really big cuts are a 10-year phasing."

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Nesting turtle numbers fall in South Asia: experts

KOLKATA: Conservationists have expressed alarm over the low number of turtles arriving on the coast of east India and Bangladesh for the nesting season, blaming overfishing and climate change for the decline.

Between November and March, several species of sea turtle, including the Olive Ridley, travel thousands of miles to nest on the sandy shores of Sundarbans, the world's largest mangrove forest.

"Just a few have so far been spotted. The long, wide beaches of the Bay of Bengal in the Sundarbans look empty," Pradip Vyas, director of the Indian government's Sundarbans Biosphere project, told AFP on Thursday.

"We are monitoring the six islands where sea turtles lay their eggs but we fear they are not coming in such numbers due to degradation of the sea, pollution and climate change."

Straddling Bangladesh and India, the 10,000 square kilometre (3,900 square mile) Sundarbans is famous for being the largest wildlife home for endangered Bengal tigers, but it is also a habitat for many rare marine species.

In Bangladesh, which is home to 60 per cent of the forest, wildlife experts said the number of turtles arriving on the pristine coastline dropped by at least 50 per cent in the past 10 years.

"It's a very grim picture," said S.M. Rashid, head of the Dhaka-based Centre for Advanced Research in Natural Resources and Management.

"In the 1990s we could spot 50-60 turtles nesting in our beaches in a night.

"But now the number has come down to a maximum 10," said Rashid, whose team in June successfully bred a critically endangered turtle using an artificial beach habitat.

Environmentalists blame a spike in fishing and climate change causing sea levels to rise and more cyclones for the alarming drop in turtle population, and they say that humans stealing eggs is another major problem.

"Overfishing has emerged as a threat to sea turtles coming to beaches of the Sundarbans," said Subrata Mukherjee, India's senior Sundarbans official, adding up to 1,500 boats now catch fish along the coast.

"A large number of sea turtles die after they are caught in fishing nets."

In the last five years, the Sundarbans were hit by two devastating cyclones, killing more than 5,000 people living in the villages along the forest.

"The nesting grounds of the marine turtle are being destroyed due to erosion and deposition of fresh sands. This is happening largely because of climate change," said Anurag Danda, an Indian WWF wildlife expert.

"Sea turtles are also avoiding the Sundarbans because of fierce winds during cyclones."

- AFP/il

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Pakistan 'Islamised' sarees, like its happening to Urdu: Chishti

VADODARA: The humble six yards was 'Islamised' by Pakistan much like what is happening to Urdu in India. Noted textile researcher and sari expert Rta Kapur Chishti said this here on Friday.

Author of 'Saris-Tradition and Beyond', Chishti said that women in Pakistan used to wear sarees in the post partition era till 1970s.

"But after 1970s, sarees were Islamised and women stopped wearing it in Pakistan. It is similar to what we are doing with Urdu in India without understanding its importance. In contrast, women in Bangladesh still wear sarees," said Chishti, stressing that there are around five lakh people across India involved in hand-made sarees but each design belongs to the region and not a particular community.

Interestingly, till 1860s blouse and petticoat were never part of the attire for donning sarees.

"Women in Bengal or elsewhere wore no blouses at all and tucked their sarees in broad box pleats to cover their lower limbs and wrapped the rest around their torsoes so that only their arms remained visible. But a single lady changed it all," she said.

According to Chishti, Jnanadanandini Tagore, wife of India's first Indian Civil Service officer Satyendranath Tagore (elder brother of Rabindranath Tagore) was the one who changed the way sarees were worn.

"She (Jnanadanandini) started a school - For Ladies Who Wanted to Go Out in late 1860s. It was there was blouse and petticoats made entry into the style of wearing sarees and completely changed the way it was traditionally worn," said Chishti.

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Winter Solstice 2012: Facts on the Shortest Day of the Year

Today is the winter solstice and the first day of winter in the Northern Hemisphere. It's all due to Earth's tilt, which ensures that the shortest day of every year falls around December 21.

Some predicted that today would also mark Earth's doomsday, thanks to a longstanding rumor that the Maya calendar ends on December 21, 2012. But earlier this year, National Geographic grantee William Saturno found evidence that the Maya calculated dates thousands of years past 2012.

"We keep looking for endings," Saturno said in a statement. "The Maya were looking for a guarantee that nothing would change. It's an entirely different mindset."

(Read more about the Maya apocalypse myth.)

Even without an apocalypse, the solstice has been an auspicious day since ancient times. Countless cultural and religious traditions mark the winter solstice; it's no coincidence that so many holidays surround the first day of winter.

Solstice in Space: Astronomy of the First Day of Winter

During the winter solstice the sun hugs closer to the horizon than at any other time during the year, yielding the least amount of daylight annually. On the bright side, the day after the winter solstice marks the beginning of lengthening days leading up to the summer solstice.

"Solstice" is derived from the Latin phrase for "sun stands still." That's because—after months of growing shorter and lower since the summer solstice—the sun's arc through the sky appears to stabilize, with the sun seeming to rise and set in the same two places for several days. Then the arc begins growing longer and higher in the sky, reaching its peak at the summer solstice.

(Related sun pictures: See a full year in a single frame.)

The solstices occur twice a year (around December 21 and June 21) because Earth is tilted by an average of 23.5 degrees as it orbits the sun—the same phenomenon that drives the seasons.

During the warmer half of the year in the Northern Hemisphere, the North Pole is tilted toward the sun. The northern winter solstice occurs when the "top" half of Earth is tilted away from the sun at its most extreme angle of the year.

Being the shortest day of the year, the winter solstice is essentially the year's darkest day, but it's not the coldest. Because the oceans are slow to heat and cool, in December the seas still retain some warmth from summer, delaying the coldest of winter days for another month and a half. Similarly, summer doesn't hit its heat peak until August, a month or two after the summer solstice.

Winter Solstice Marked Since Ancient Times

Throughout history, humans have celebrated the winter solstice, often with an appreciative eye toward the return of summer sunlight.

Massive prehistoric monuments such as Ireland's mysterious Newgrange tomb (video) are aligned to capture the light at the moment of the winter solstice sunrise.

Germanic peoples of Northern Europe honored the winter solstice with Yule festivals—the origin of the still-standing tradition of the long-burning Yule log.

The Roman feast of Saturnalia, honoring the God Saturn, was a weeklong December feast that included the observance of the winter solstice. Romans also celebrated the lengthening of days following the solstice by paying homage to Mithra, an ancient Persian god of light.

Many modern pagans attempt to observe the winter solstice in the traditional manner of the ancients.

"There is a resurgent interest in more traditional religious groups that is often driven by ecological motives," said Harry Yeide, a professor of religion at George Washington University. "These people do celebrate the solstice itself."

(Related: Get Stonehenge facts and pictures in National Geographic magazine.)

Pagans aren't alone in commemorating the winter solstice in modern times.

In a number of U.S. cities a Watertown, Massachusetts-based production called The Christmas Revels honors the winter solstice with an annually changing lineup of traditional music and dance from around the world.

"Nearly every northern culture has some sort of individual way of celebrating that shortest day," said Revels artistic director Patrick Swanson. "It's a lot of fun for us to dig up the traditional dance and music and even the plays [honoring] that time of the year."

Of course, as the name suggests, The Christmas Revels mix ancient winter solstice traditions with customs of the holiday that largely replaced winter solstice celebrations across much of the Northern Hemisphere: Christmas.

Winter Solstice's Christmas Connection

Scholars aren't exactly sure of the date of Jesus Christ's birthday, the first Christmas.

"In the early years of the Christian church, the calendar was centered around Easter," George Washington University's Yeide said. "Nobody knows exactly where and when they began to think it suitable to celebrate Christ's birth as well as the Passion cycle"—the Crucifixion and resurrection depicted in the Bible. (Related: "Christmas Star Mystery Continues.")

Eastern churches traditionally celebrate Christmas on January 6, a date known as Epiphany in the West. The winter date may have originally been chosen on the basis that Christ's conception and Crucifixion would have fallen during the same season—and a spring conception would have resulted in a winter birth.

But Christmas soon became commingled with traditional observances of the first day of winter.

"As the Christmas celebration moved west," Yeide said "the date that had traditionally been used to celebrate the winter solstice became sort of available for conversion to the observance of Christmas. In the Western church the December date became the date for Christmas."

Early church leaders endeavored to attract pagans to Christianity by adding Christian meaning to existing winter solstice festivals.

"This gave rise to an interesting play on words," Yeide said. "In several languages, not just in English, people have traditionally compared the rebirth of the sun with the birth of the son of God."

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NRA to Speak on Stopping Newtown Repeat

For the past week, leadership at the National Rifle Association has largely stayed away from the media, but this morning the group may weigh in on how to keep a deadly shooting massacre like last week's at a Newtown, Conn., elementary school from happening again.

The NRA will hold a news conference in Washington, D.C., just before 11 a.m.

Its leadership has held off on interviews this week after refusing to appear on Sunday morning public affairs shows this past weekend.

The group came under pressure after Adam Lanza, 20, killed 20 children and six adults before shooting himself at Sandy Hook Elementary School in Newtown last Friday.

"Out of respect for the families, and as a matter of common decency, we have given time for mourning, prayer and a full investigation of the facts before commenting," the group said in a press release Tuesday. "The NRA is prepared to offer meaningful contributions to help make sure this never happens again."

NRA News anchor Ginny Simone said Thursday that in the wake of the Sandy Hook shooting, membership surged "with an average of 8,000 new members a day."

New York City Mayor Michael Bloomberg has said the NRA is partially to blame for the tragedy.

"We're not trying to take away your right to advance the interests of gun owners, hunters, people who want to protect themselves," Bloomberg told "Nightline" anchor Cynthia McFadden in an interview Thursday. "But that's not an absolute right to encourage behavior which causes things like Connecticut. In fact, Connecticut is because of some of their actions."

Christian Gooden/St. Louis Post-Dispatch/AP Photo

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The guns used in the attack were legally purchased and owned by the shooter's mother, Nancy Lanza, who Adam Lanza shot to death before his assault on the school.

In the aftermath of the shooting, many, including Bloomberg, have called for stricter regulations on the type of weapons used in this and other instances of mass gun violence this year.

Sen. Dianne Feinstein, D-Calif., has said she intends to introduce a bill banning assault weapons on the first day of next year's Congress -- a step the president said he supports.

President Obama announced Wednesday that Vice President Joe Biden will head a task force of leaders from across the country that will evaluate the best solutions to reduce gun violence in the United States.

Obama said he will "use all the powers of this office to help advance efforts aimed at preventing more tragedies like this."

Mayors Against Illegal Guns, of which Mayor Bloomberg is co-chair, released a letter to President Obama signed by more than 750 mayors calling on him to produce a plan to "make it harder for dangerous people to possess guns."

The letter asked for mandatory background checks for gun buyers, a ban on high-capacity rifles and ammunition magazines, and a designation of gun trafficking as a federal crime.

ABC News' George Stephanopoulos looked at whether strict gun control laws like those that have worked for the United Kingdom and Japan could work for the U.S. on "Good Morning America" Thursday.

Others have argued that, rather than banning guns, the government should be arming teachers and administrators in schools so that they can defend students in the event of another school shooting.

While Michigan Gov. Rick Snyder vetoed a measure that would have let guns into schools on Tuesday, Texas Gov. Rick Perry and Virginia Gov. Bob McDonnell praised the idea.

Speaking on the NRA's daily news program Tuesday, Dave Koppel of the Independence Institute said the teachers at Sandy Hook should have had weapons.

"We'd certainly be talking about fewer innocent people and children dead," Koppel said.

While a national debate over the necessary solutions to prevent a tragedy of this nature from ever happening again wages on, Connecticut residents will have to wait "several months" before the final Connecticut State Police report on the Newtown shootings is complete.

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China economic growth likely to pick up: analysts

SHANGHAI: China's economic growth may pick up to above 8 per cent in 2013, as economists expect the government to launch policies to boost recovery.

The country is expected to report 7.5 per cent this year, the slowest pace in recent years.

Economists say investment will remain as the pillar of growth the Chinese economy in the short term, despite the government's push for consumption.

The new government may also ease some current property curbs to achieve immediate growth.

As exports are expected to remain weak, China's growth now largely relies on investment and consumption.

Experts say the country's new leaders need to roll out short-term measures to achieve immediate results and gain public support.

This is likely to start with loosening some control over the property market.

Real estate accounts for about 25 per cent of China's GDP directly and indirectly.

"Trading volume has been decreasing very quickly in the recent market, and this is a big blow to the recent investment," said Gary Liu, executive deputy director of CEIBS Lujiazui Institute of International Finance.

"For the central government, it's probably very difficult to announce that we will give up the real estate market policy because they always want to maintain their image; they care about the housing price. But the local government will loosen the real estate market policy and the price will pick up, probably not as quickly as past years, but still I think has a large space to go."

Consumption is another key growth pillar.

On top of improving income distribution and social security system to encourage spending, experts believe, it is important to encourage wealthy Chinese to spend their money at home.

This group of rich Chinese accounts for about 20 per cent of the total population, but they hold 80 per cent of China's wealth.

"What they buy overseas is mostly branded goods, which Chinese companies don't have," said Sun Lijian, vice dean of the Economy School at Fudan University.

"We need to upgrade our industries and create Chinese brands, which are recognized in the world. Our goal for next year is to attract these rich people to spend in China."

According to experts, consumers in the cities tend to splurge on properties or cars. But there are curbs and heavy traffic to consider.

China is now looking for new ways to drive growth in consumption, and encouraging urbanization could be the answer.

Qian Qimin, co-director of market research at SWS Research Co Ltd said: "For example, when people from the countryside move to towns, they need to buy cooking utensils, home appliances and furniture. This will be a good way to push consumption. Now in cities, consumption has generally reached a plateau. People in cities have own almost all the living necessities."

The Chinese economy is well on its way recovery, but experts say any major changes will have to wait till the ruling party's third plenary session or meeting of top politicians next October.

- CNA/xq

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