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Why Li Keqiang Index remains important benchmark

( Updated: 2015-06-06 16:53

"Statistics show that proportion of raw coal in the energy sector gradually went down from 77.8 percent in 2011 to 73.2 percent in 2014, a 4.6 percent decrease," according to the Post. As far as consumption is concerned, it fell from 70.2 percent in 2011 to 66.0 percent in 2014, a decrease of 3.8 percent, said the website.

This means the freight business of railways will be impacted negatively. The proportion of railway freight volume in the whole freight business fell to less than 10 percent since 2012, a mere 9.2 percent in the first quarter of 2015, said Post.

Nothing illustrates the relevance and importance of Li Keqiang Index than its comparisons with major economic indicators.

When growth fell from 7.7 percent in 2013 to 7.4 percent in 2014, industrial power consumption volume also declined from 7.0% to 3.7 percent. When the growth rate was 0.3 percent lower in 2014 than that of 2013, the railway freight volume fell from 1.6 percent in 2013 to minus 3.9 percent in 2014.

"Direction and trend of change in those two areas are basically consistent," said London Post. Similarly, growth rate in medium and long-term loan balance is over 10 percent, which is well matched with the economic growth rate, it added.

The index remains an important benchmark to study and analyze economic trends and it retains its crucial reference value, according to the website.

"With further development of economy, quantitative relationship will probably undergo further changes. This tells us that we shall fully and accurately understand "Li Keqiang Index" in the light of the development achieved, especially at the time of analyzing China as a complicated and huge economy during the period of transformation and development," said London Post.

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