Thirty years ago, 18 farmers in this rural backwater of east China entered a pact to carry out a bold economic experiment, and became heroes of reform almost overnight.

Now these pioneers, their hair greying, are hoping for a new revolution to once again transform their small community and close a yawning wealth gap with the cities.

Some official histories argue that China's market reforms began right here in Xiaogang of Anhui province, when the 18, exasperated by relentless poverty, agreed to abandon their commune, or rural collective.

In its place they implemented a "household responsibility system" that essentially returned land back to the farmers and allowed them to freely sell any produce they harvested beyond state-set quotas.

Grain production doubled in Xiaogang within a year and after approval from the state, farmers nationwide began abandoning the communes and flocking to free markets.

"It was a fact that the commune system did not work," said Liu Hongchang, 60, the leader of Xiaogang's reform drive in 1978.

"Because of this fact, the party did not round us up as counter-revolutionaries but instead a lot of leaders, including (the late reformer) Deng Xiaoping, praised our reforms," Liu told AFP.

Fully aware of the dangers of going against Beijing's policy, the farmers -- who "signed" the document with red thumb prints -- further included in their pact a vow to take care of each other's children should anyone be arrested.

Today Xiaogang's story is legendary, taught at every school in China as exemplifying the pragmatism and "wisdom of the Chinese peasant".

Nearly every top Chinese leader has visited Xiaogang to pay tribute to the policies that opened China and made way for its economic miracle, including Deng, former president Jiang Zemin and current President Hu Jintao.

The farmers were the first to benefit from reform but in recent years growth in rural areas has lagged significantly behind that in the cities.

Up to 800 million rural dwellers remain relatively poor with average rural incomes about 3.3 times lower than urban ones, according to official statistics.

To address the wealth gap, Hu has used the anniversary of China's economic reforms to spearhead a new rural policy that will legally allow farmers to transfer or rent their land-use rights.

The policy is expected to be the backbone of a government pledge to double the per capita rural income of 4,140 yuan (591 dollars) by 2020.

The key to the issue, officials and farmers said, is whether or not the government will be able to adequately protect farmers' land rights, especially from local officials hoping to turn profits on cheap rural land.

"When President Hu came here he said the household responsibility system would not change, that farmers would have the right to their lands for a long time to come," 65-year-old Yan Jinhong, another of the 18 pioneers, told AFP.

"The government is saying that farmers will no longer be forced to give up their lands and all land transfers must be done in accordance with the law and the wishes of the farmers, and with compensation."

As all land in China technically belongs to the state, over the last 30 years both urban and rural officials have made themselves rich by taking land, often in corrupt deals with developers.

The issue has become one of the most sensitive in China.

"How to prevent violations of the law and regulations under such conditions when so much land is being used is one of the major tasks (of the new land policy)," Lu Xinshe, vice minister of Land Resources told journalists last week.

"If legal measures are not enforceable, then there is a possibility that the (land reform) will become chaotic and lead to a new round of disordered land grabs."

Amendments to China's land law spelling out new legal measures of the land policy are expected to be adopted in the coming year, he said.