URUMQI - Regulators and bankers on Friday vowed to increase capital support for the Xinjiang Uygur autonomous region.

The move is expected to provide relief for the northwestern Chinese region that is thirsty for funding amid the country's monetary-tightening policies aimed at curbing inflation.

Ma Delun, vice-governor of the People's Bank of China, said the government has implemented less harsh monetary policies in the region.

"We increased the reserve-requirement ratio for commercial lenders six times this year but in Xinjiang, the ratio is 2 basis points lower than elsewhere and for rural credit cooperatives the ratio is even 6 basis points lower."

However, he admitted that major banks have decreased the number of loans to Xinjiang. "They shouldn't do so."

The lending quota to the region decreased from 120 billion yuan ($18.8 billion) in 2010 to 90 billion yuan this year, said Wang Huimin, assistant chairman of the Xinjiang government. Wang is in charge of the region's finances, securities and State-owned assets.

By the end of July, new loans by China's major banks to Xinjiang accounted for 85 percent of the yearly quota, he said.

Although loans available for the region slowed down, the growth of lending in Xinjiang has topped the nation this year, according to Cai Esheng, vice-chairman of the China Banking Regulatory Commission.

By the end of July, outstanding loans in Xinjiang reached 131.6 billion yuan, a rise of 28.4 percent year-on-year.

"Credit is a foundation to fuel Xinjiang's growth. We must guarantee the lending supply while watching bad loans carefully," Cai said.

Industrial and Commercial Bank of China Ltd, the world's largest lender by market value, plans to double its lending in the region in the next three years, said Yi Huiman, vice-president of the bank, without revealing the number of loans his bank provides for Xinjiang.

Apart from loans, the capital market should develop into another major financing source for businesses in Xinjiang, said Ma from the central bank.

Liu Xinhua, vice-chairman of the China Securities Regulatory Commission, said the commission will support Xinjiang companies that want to list on the stock markets and raise funds.