China continues to pursue a plan of modest economic growth with strong emphasis on increased agricultural and light industrial production.

Recent political criticism of the $5 billion Boashan steel plant near Shanghai as wasteful is expected to slow significantly negotiations for future new industrial projects with large foreign investment. The Boashan steel project came under attack at the National People's Congress for using valuable resources and foreign exchange earnings.

"I think the Chinese are looking closely at Poland," said an American in Peking who has been in regular contact with several Chinese ministries. "They see a Socialist country with $20 billion in foreign debt and tremendous problems. That has to have some impact."

China's Finance Minister, Wang Binggian, told the People's Congress there had to be "tighter controls over imports."

Despite the apparent decision to pull back on large projects until they work out their financing problems, the Chinese appear to be continuing development of their off-shore oil resources. Sources at the Chinese Petroleum Ministry said foreign oil companies are expected to complete their final seismic surveys by January. Bidding for exploratory contracts for at least a third of the offshore area is expected in the first quarter of 1981.

So far, however, China has yet to live up to the expectations of some people that its oil reserves will eventually make it another Saudi Arabia. China's annual oil production has leveled off at about 106 million metric tons. The nation's coal production also increased only marginally last year. China's total energy production in the first seven months of the year increased by only 0.9 percent.

Major oil fields such as Daging in the northeast are running low forcing the Chinese to push the offshore exploration. But even with the help of Western oil companies, analysts do not expect an upsurge in China's oil production until at least 1985.

In other areas of the economy, China is predicting a modest, 4 percent increase in agricultural production next year and total output from light industry is expected to rise eight percent.

In the first seven months of 1980, however, light industrial output -- including textiles -- rose by 23.3 percent. This reflection an attempt by the Chinese to increase export earnings and raise domestic living standards. Output by heavy industry, by contrast, increased only 6.3 percent in the same period.

Capital investment during the first half of 1980 dropped 4.4 percent reflecting a 20 percent cut in large- and medium-sized construction.