China considers developing large jets - sources

SHANGHAI (Reuters) - China is considering a plan to develop large passenger jets in a long-term, multi-billion dollar project that it hopes would wean it from reliance on Boeing Co. (BA.N: Quote, Profile, Research, Stock Buzz) and Airbus, industry sources said on Monday.

The State Council, China's cabinet, has received a project proposal drawn up after a recent hearing attended by government officials and industry experts, two industry sources told Reuters on condition of anonymity.

The country's two state aircraft makers, AVIC I and AVIC II, as well as the Commission of Science Technology and Industry for National Defense, would be involved in developing the jets, they said.

Yuan Liben, an adviser to AVIC I, added that the project would aim to produce a prototype by 2010.

"The project has the backing of the government and the country has done lot of preparation over the years," Yuan said.

AVIC I and AVIC II, both of which make components for Airbus and Boeing, also have experience in civilian jet development and manufacturing.

AVIC I has secured more than 30 orders for its ARJ21 regional jet, scheduled for commercial operation next year, while AVIC II unit Hafei Aviation Industry Co. (600038.SS: Quote, Profile, Research, Stock Buzz) makes the ERJ-145 regional craft in partnership with Brazil's Embraer

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