Returned graduates will be qualified to work without residency restrictions, personnel quotas and pay limits, according to a document jointly issued by the ministries of personnel and education.

China maintains a residency control policy in major cities like Beijing and Shanghai, limiting incoming migrants looking for work.

Graduates in high-level professions who are willing to return will be able to live and work freely, according to the document.

The document says the Personnel Ministry will, with other ministries, provide special funds to attract graduates with urgently needed skills.

High-level graduates will have simplified procedures at border entry and exit points, says the document.

Returned graduates are encouraged to explore opportunities in the country's west and to help revive the northeast traditional industry bases.

The two ministries also expect returned graduates to introduce more advanced foreign technologies and to fund and establish more high-tech enterprises.

Students unable to return imminently will be encouraged to undertake research cooperation with domestic partners.

A total of 1.07 million Chinese students have studied abroad, including self-financed and state-financed, but just 275,000 returned to China after graduation. Last year, 42,000 came back, 21.3 percent up from the number in 2005.