The central government will spend 339.7 billion yuan (US$42 billion) on agriculture, rural areas and farmers this year, Premier Wen Jiabao said yesterday.
That would be 42.2 billion yuan, or 14.18 percent, more than last year, Wen noted.
The target, along with plans to shift the government's priority from infrastructure investment to the countryside, is to completely rescind agricultural taxes and to increase spending on rural education and medical care, signifying the drive to "build a socialist new countryside" will be put into place this year.
"We need to implement a policy of getting industry to support agriculture and cities to support the countryside, strengthen support for agriculture, rural areas and farmers, and continue making reforms in rural systems and innovations in rural institutions to bring about a rapid and significant change in the overall appearance of the countryside," Wen said in a report on the work of the government at the annual session of the national legislature.
To build the "new countryside," the Central Committee of the Communist Party of China has set objectives including "enhanced productive forces, higher living standards, civilized living style, an orderly and clean environment, and democratic administration."
China had drawn a huge sum of money for industrial development from agriculture and rural areas in the initial stage of industrialization and urbanization since 1949, resulting in yawning gap between the city and the countryside.
To narrow the gap, the government has kept increasing central spending on agriculture, rural areas and farmers over the last few years. In 2005, the fund from the central budget and T-bond proceeds to support agriculture, rural areas and farmers reached 297.5 billion yuan, 34.9 billion yuan more than in 2004 and over 100 billion yuan more than in 2002. The capital inputs of many localities for this purpose also reached a record high.
This year, said Wen in the report, priority will be given to developing modern agriculture and promoting steady expansion of grain production and a sustained increase in farmers' incomes.
"We will further increase direct subsidies to grain producers, subsidies for growing superior grain, and subsidies for agricultural machinery and tools," Wen said.
"We need to resolutely work to reorient investment by shifting the government's priority from infrastructure investment to the countryside. This constitutes a major change," he said.
The fund will be mainly used for strengthening basic development of farmland, accelerating construction of infrastructure projects such as roads, drinking water supplies, methane facilities and communications.
This year, China will completely rescind agricultural taxes throughout the country, a tax that has been collected for 2,600 years. Wen called the move "a change of epoch-making significance."
The reform of rural taxes and fees greatly benefits farmers by eliminating 33.6 billion yuan of agricultural tax and over 70 billion yuan of various fees and charges.
(Xinhua)