Foreigners who obtain permanent residency will have the same pension, employment and property rights as Chinese citizens, under new regulations announced on Tuesday.
Access to schools for their children will also be on par with Chinese citizens the rules endorsed by central government departments in September state.
The only rights not afforded to "green card" holders are political rights.
Foreigners with permanent residency can participate in all aspects of social insurance and avail of the benefits.
There are five types of social insurance: endowment, medical, unemployment, work-related injury and maternity.
Green card holders are exempt from a restriction that does not allow foreigners who have worked or studied less than a year in China to buy property. They can also work in China without a work permit.
Their children, of a compulsory education age, can attend a school that is near their place of residence, and they will not be charged any fees except a statutory sum.
Foreigners who have permanent residency can enjoy simplified investment and registration procedures if they want to invest in or set up a business.
Spouses and immediate family members can apply for visas, residence permits and a green card, under the regulation.
China started to grant permanent residency permits to foreigners in 2004. Since then, nearly 5,000 have received the permits and many of them are high-level experts.
"The green card system has become an important mechanism to attract international expertise," the Ministry of Human Resources and Social Security, which helped draft the regulation, said in an explanation of the new rules on Tuesday.
The ministry acknowledged that green cards are vital for developed countries such as the United States and European nations to compete for global talent. The US annually grants 140,000 green cards for immigrants with expertise.
China has been working hard to improve rights that green card holders can enjoy so as to get more overseas experts and professionals that are urgently needed, the ministry said.
Rhio Zablam, from the Philippines, works at a media firm in Beijing. He married a Chinese woman in 2011, and his wife is due to give birth in February.
"I've been in China for two years, and since I got married to a Chinese citizen I can apply for my green card in three years," the 34-year-old said. "The new green card policy is great news for me because I will not need to obtain a work permit anymore if I want to change my job.
"A green card will also make me feel that I am not an outsider anymore, and I really want to fully immerse myself in life in China."
China's first legislation covering the exit and entry of Chinese citizens and foreigners, the Law on the Exit and Entry Administration, which was passed in June and will take effect in July 2013, allows for an increase in the number of green cards.
China may introduce policies for easier access to permanent residency permits for foreigners, according to an expert commenting on a proposed draft regulation being prepared by the Ministry of Public Security.
Liu Guofu, an immigration law specialist at the Beijing Institute of Technology, praised the new green card regulation and said such rules should have come earlier.
"China started to grant green cards in 2004 but the first batch of green card holders have only become entitled to their due rights eight years later," he said.
Liu said before the regulation, a Chinese green card mainly carried favorable entry and exit policies.
"If a green card does not bring other basic rights such as employment, pension and children's education, it will not be attractive and will not help introduce global talent," he said. "The new regulation will help foreigners have a sense of security."
In the long run, he added, China should consider granting some other rights, such as allowing green card holders to set up panels to voice their suggestions to the government.
"Now they can obtain economic and social rights as Chinese citizens do, they may ask for political rights if they live in the country for long," Liu said.
