BEIJING - The draft revision to the budget law, tabled for the second reading Tuesday, removes amendments to ease restrictions on local government bonds.

The bill was submitted at the bi-monthly session of the National People's Congress (NPC) Standing Committee, which runs from Tuesday to Saturday.

The bill presented for the first reading had included an article allowing local governments to issue bonds within a quota set by the State Council and approved by the NPC.

The bill for the second reading removed this article and reinstated the regulation in the current law that bans local governments from issuing bonds.

According to the bill, the financial department of the central government can issue bonds on behalf of local governments only in accordance with the laws and regulations issued by the State Council, China's Cabinet.

The draft law amendment cast a shadow over the trial run of allowing some local governments to issue bonds last November.

As part of a pilot project aimed at curbing debt risks for cash-strapped local governments, China approved the cities of Shanghai and Shenzhen, as well as the provinces of Zhejiang and Guangdong, to issue bonds in November last year. The Cabinet said in May that the bond issuance trials would be continued this year.