China's urbanization rate has rocketed over the past three decades, but statistics don't tell the whole story, and the country faces a challenge in improving the quality of urbanization, senior officials said on Sunday.

Urban residents accounted for 51.27 percent of the population in 2011, compared with about 18 percent in 1978 at the beginning of reform and opening-up, according to official figures.

However, this rapid pace of growth is unsustainable, as it is, to some extent, based on cheap labor and land, insufficient social security and inadequate public services, senior officials said at the annual China International Urbanization Forum in Shanghai on Sunday.

China must improve the quality of its urbanization by deepening reforms, said Peng Sen, deputy minister of the National Development and Reform Commission, the country's top economic planner.

The priority is to further reform the land expropriation policy, he said. Land expropriation has played a role in advancing urbanization and industrialization, but it has also led to problems such as inadequate protection of farmers' property rights and the irrational use of land, Peng said.

"China can no longer push forward its industrialization and urbanization at the cost of farmers' property rights," Peng said.

Policymakers must provide the conditions for farmers to benefit more from the appreciation of land values, and the land acquisition system must be reformed on the basis of protecting farmers' interests and ensuring the economic use of land, he said.

Also, the country needs to make steady progress in reforming the household registration system - most crucially, to allow migrant workers equal access to public services as that enjoyed by urban residents, Peng said.

Though the number of urban dwellers has outpaced the rural population, about "one-third" of these city dwellers don't have a permanent residency permit in the cities where they live, said Chen Xiwen, director of the office of the Communist Party of China Central Committee's Leading Group on Rural Work.

Experts noted that in China, the definition of "urban resident" includes migrants who have worked in cities for more than six months.

"The old roadmap for promoting urbanization is unsustainable," Chen said, adding that China's urbanization calls for an overall strategy and design, instead of being constrained by individual cities and towns.

While deeper reforms are needed to give migrant workers equal treatment with urban residents, the costs will put enormous pressure on governments at various levels.

Chen suggested that policymakers design a more flexible system, which will permit migrant workers to make their own decisions while also providing a transitional period for the governments to digest the costs.

For instance, in Thailand, if a migrant worker chooses to settle down in a city and become an urban resident, he needs to make social security payments for eight years. Only then does the local city government classify him as a resident, he said.

China has some 200 million people who are living in cities but don't have a hukou, or permanent urban residence certificate, experts said.

Li Tie, director-general of the China Center for Urban Development under the NDRC, said about 20 percent of migrant workers have lived in cities for more than 10 years.

Li said more than 70 million of them are well-educated "white-collar" workers, according to the center's survey.