'Big is beautiful' may be Beijing's strategy of nurturing domestic giants to compete with international rivals at home and abroad, but some now wonder if the policy could snuff out the very element Chinese industries most need: competition.
Analysts - citing the fiasco of South Korea's chaebol conglomerates in the past year - said if big state enterprises became even larger, they might enjoy economies of scale at the expense of fleet-footedness.
Beijing has been promoting the policy of 'grappling large ones and loosening the small ones' to concentrate reforms on big state-owned enterprises (SOEs) through mergers and acquisitions.
The plan gained momentum recently, when Beijing announced the merger of Yizheng Chemical Fibre, the world's fourth-largest polyester maker, with three nearby chemical plants - Yangzi Petrochemical, Jinling Petrochemical and Nanjing Chemical Industrial - in Nanjing, Jiangsu province.
The new entity will house the mainland's largest petrochemicals, chemical fibres and fertilisers manufacturing base, with work being divided between them to avoid overlapping production.
The cross-ministry agreement - the four enterprises belong to different bureaucratic organisations - will provide a case study for SOE reform at the 15th Party Congress which opens tomorrow.