BEIJING -- Lawmakers on Saturday called on the government to update rural land-use policies to modernize and streamline the agriculture sector.

The State Council on Tuesday submitted a report on rural development during the bi-monthly session of the Standing Committee of the National People's Congress (NPC).

Government representatives -- including officials from the agriculture, environment and finance ministries -- were asked to attend Saturday's panel discussion with lawmakers to review the report and be questioned on their planned and implemented policies.

Development of the agriculture sector appears to have stagnated and farmers still earn much less than those employed in other sectors, said Lyu Zushan, a member of the NPC Standing Committee, during the panel inquiry.

Urbanization has resulted in the younger generation leaving rural areas en masse, as farming is neither profitable nor promising, he said.

To modernize the sector and improve its competitiveness, land use and farming procedures must be improved through reform measures, he said.

In China farm land is collectively owned by villages rather than individuals. A rural household can sign a 30 year contract to obtain the right to use a plot of land, as long as it is not used for any other purpose than farming.

Although farmers have the right to transfer their land rights to others, there has been an unspoken rule discouraging this practice. As a result, arable land is divided into small plots and farmed by individuals.

Many argue that this has a negative impact on efficiency and makes it difficult to modernize agricultural processes.

Lyu suggested that these barriers should be lifted so farms can expand, thus, increasing output and profitability.

The government should also encourage farmers to form shareholding cooperatives, he said.

Other lawmakers concurred that bigger farms and cooperatives could help with the adoption of new technology and modernization of processes as well as support farmers amid tougher market competition.

In response to the lawmakers, Vice Agriculture Minister Chen Xiaohua said rural land use reform was a priority for his ministry.

The government has, and will continue to, adopt measures that ease contract transfer and encourage farmers to set up cooperatives to ease the transition of individual plots of land into cooperatives, Chen said.

The government is currently reviewing its records on agriculture land-use contracts, as record keeping at the village level has been sporadic and many rural families have left the area, he said.

This will be an arduous process, due to the large rural population and amount of farm land, but it had to be done as the transfer of land use rights must be smooth and efficient in the future, he said.

According to the State Council's report, the process will be finished in the next five years.

Another NPC Standing Committee member, Li Lu, suggested that the government should encourage private companies to invest in agricultural business domestically and abroad.

Many industrial companies have showed an interest in agriculture and some already invest in the sector abroad, he said.

According to the State Council, although China's grain output increased for the 11th-consecutive year, reaching 67.1 billion kilograms in 2014, agriculture struggles with the effects of pollution, low efficiency, increasing labor costs and thin profits. resulting in rural communities missing out on public service reform measures.

Lawmakers also asked the government to pay more attention to water conservation and rural education.

Zhang Dejiang, chairman of the NPC Standing Committee, attended the penal discussion Saturday morning. After that, he and the vice chairs held a meeting to review several bills.