A raft of measures have been unleashed to open up the domestic photovoltaic (PV) market amid increasing trade tensions with the European Union, according to a meeting of China's cabinet on Friday.

The development of the domestic PV sector is also in line with China's initiatives to upgrade industrial operations, according to a statement released after an executive meeting of the State Council presided over by Premier Li Keqiang.

China's internationally-competitive PV sector has met with difficulties due to subdued overseas demand, the statement said, adding that support must be granted to the PV sector to help it out of this predicament.

China will take more initiatives to promote distributed solar PV power projects to boost PV utilization, it said. Chinese power suppliers on the grid are urged to prioritize purchases of solar power and buy all available solar power, said the statement.

Power transmission lines linking production facilities and grid companies must be built when a solar power project is under construction, it said, adding that the transmission lines and the power projects must be put into operation at the same time.

China will improve policies to support more solar power facilities with government subsidies in power pricing, said the statement. The renewable energy fund will be expanded to ensure that more distributed PV projects receive government subsidies in time.

Financial institutions are encouraged to support PV companies and help them overcome financing difficulties, said the statement. China will support research and development into key materials and key facilities in the PV sector, it vowed.

To foster bigger and stronger companies and curb the blind expansion of production capacity, China will encourage mergers and reorganizations among PV makers.

Earlier this month, the EU imposed an interim anti-dumping duty of 11.8 percent on imports of all Chinese solar panel products, including panels, cells and wafers. If both sides fail to come to an agreement, the duty will be raised to an average of 47.6 percent in two months.

Chinese solar panel firms have complained that the EU's punitive duties will eat away at their low margins and could even drive them out of the market.