China has introduced new initiatives to bolster index investment products, marking a crucial step in addressing the challenges faced by the stock market amid global economic uncertainties.

According to Bloomberg, the government aims to significantly increase the volume and share of index investments in the capital market, as stated by the China Securities Regulatory Commission (CSRC) in an announcement on their website on Sunday.

The regulator intends to enhance the efficiency of asset allocation for index funds and create more accessible channels for attracting medium- and long-term investments.

Additionally, CSRC seeks to stimulate foreign investments in yuan-denominated A-shares via exchange-traded funds and promote the development of equity and bond ETFs. The regulatory body has also pledged to reduce the costs associated with index funds and exempt them from market-making fees.

In recent months, Chinese stocks have been under pressure due to concerns about prolonged economic downturns and the potential for tariff increases from U.S. President Donald Trump. Investors are increasingly disappointed with the government's attempts to stimulate the economy and are questioning the effectiveness of the measures implemented so far.