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2. Consolidating and strengthening the position of agriculture as the foundation of the national economy and increasing rural incomes and agricultural production
Solving problems facing agriculture, rural areas and farmers is a top priority in all our work. Once again, China's agriculture is in a crucial period of its development. This year we must take more direct and effective policies and measures to strengthen, support and protect agriculture and increase rural incomes in line with the need to balance urban and rural development.
First, the overall grain production capability must be maintained and increased. The strictest possible system for protecting farmland will be implemented and control over the use of farmland will be strengthened in accordance with the law. We will resolutely put an end to illegal acquisition and use of farmland and rectify unauthorized changes in the use of primary farmland. Reform of the system for land expropriation will be accelerated, and the expropriation procedures and mechanisms for compensation will be improved to ensure that the compensation for expropriated land is appropriate. The acreage sown in grain crops will be expanded, and the yield per unit area increased. Support will be focused on increasing production in major grain producing areas. Projects to industrialize production of high-quality grains will be undertaken. We will make primary farmland capable of producing stable, high yields.
Second, we will promote strategic restructuring of agriculture and the rural economy. Great efforts will be made to develop high-quality, high-yield, cost-effective, eco-friendly and safe agriculture, to improve the quality of agricultural products and enhance their competitiveness. We will carry forward the development of industrial belts for producing competitive agricultural products and promote the industrialization of agriculture. We will energetically develop animal husbandry and prevent and control the spread of the highly pathogenic bird flu and other animal epidemics. We will encourage the development of non-agricultural industries in rural areas and expand intra-county economies. We will steadily carry out the process of urbanization. We will improve the employment environment for rural workers in cities, provide them with more and better training and create more jobs for them in various ways.
Third, we will press ahead with the reform of rural taxes and administrative charges. All taxes on special agricultural products will be repealed except for tobacco, thus reducing the financial burden on farmers by 4.8 billion yuan annually. Beginning this year, the agricultural tax rate will be reduced by more than 1 percentage point per year on average, and agricultural taxes will be rescinded in five years. The agricultural tax burden on farmers will be reduced by 7 billion yuan this year. The central government will appropriate 39.6 billion yuan this year from its budget for transfer payments to support the reform of rural taxes and administrative charges. We will accelerate reforms of county and township government institutions.
Fourth, we will deepen the reform of the grain distribution system. All controls over grain purchase and sales markets will be lifted. The reform of state-owned grain enterprises will be accelerated. Control and regulation of grain markets will be strengthened, and subsidies will be given directly to grain producers. The state will appropriate 10 billion yuan this year from its grain risk fund to directly subsidize these producers in order to stimulate their enthusiasm for grain production. The prices of the means of agricultural production will be better monitored and controlled to protect farmers' interests.
Fifth, we will increase investment in agriculture and rural areas. Governments at all levels must invest more in agriculture, rural areas and farmers. This year, the central government will appropriate around 30 billion yuan for this purpose, at least 20% more than last year. Treasury bond funds should be invested mainly in the construction of six categories of small projects for rural areas (water-efficient irrigation, potable water supplies, roads, methane production facilities, hydroelectric plants and pasture enclosure) and in construction of water control projects, in order to improve the living and production conditions of farmers. We will continue to aid the rural poor through development by increasing funding for poverty alleviation in various ways and giving people work in place of relief subsidies. Rural financial services will be improved. To assist rural residents expand production, rural credit cooperatives will extend more micro-credit loans to individual families and groups in rural areas.
Sixth, progress in agro-science will be accelerated. We will tackle agro-science problems with greater intensity and increase our ability to make advances in agro-science and hold them in reserve and find applications for them. We will strengthen the system for spreading the application of science and technology in rural areas. We will energetically promote wider application of advanced applied technology that can help increase production and improve productivity. We will expand both the size and scope of subsidies for developing seeds of high-quality crop varieties.
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