China will continue its proactive fiscal policy in 2011 to improve infrastructure and people's living standards, said Jia Kang, head of the Research Institute for Fiscal Science of the Ministry of Finance.

Speaking at the China Textile Round-Table Forum Annual Conference 2011, Jia attributed the policy decision partly to the need to roll out more follow-up investment programs for the four-trillion-yuan (607 billion yuan) economic stimulus program launched by the central government to combat the global downturn in November 2008.

Further, Jia refuted criticism over China's continuous building of infrastructure, saying many regions and cities were still suffering from inadequate roads or subway systems, citing Beijing's severe traffic jams as an example.

"China also needs to make investments in a nationwide medical insurance system and affordable housing, to expand domestic consumption and improve the living standards of the people," said Jia.

During the annual Central Economic Work Conference held in December 2010, the central authorities agreed that the country would continue its proactive fiscal policy next year, while switching its monetary policy stance from relatively loose to prudent.

Jia said China's fiscal policy, after years of being "proactive," would return to "prudent" at some point of time, when appropriate. "However, it would be a gradual exit which is not likely to happen in 2011."