The center requires all local governments to provide minimum social security for migrant workers and insurance coverage for work-related injuries.

According to statistics, there are 940 million registered permanent rural residents. But the actual number of those living in rural areas is about 750 million. About 200 million farmers are estimated to have joined the ranks of the migrant workers.

Premier Wen said the first priority in the new measure to improve the countryside is to develop modern agriculture and promote a steady expansion of grain production and a sustained increase in farmers' income.

By 2010, China's grain production capacity is expected to reach 500 million tons. Grain output in 2005 was 480 million tons, while grain demand was 499.5 million tons. A grain production capacity of 500 million tons can make China self-sufficient in grain.

Du Qinglin, Minister of Agriculture, said that in the next five years, China will try to increase grain output, raise the efficiency of agricultural resource use, cut costs of agricultural production, improve comparative and comprehensive profits of agriculture, enhance international competitiveness of China's agriculture and keep farmers' income rising by more than 5 percent annually.

Financial support

"Central Government budget expenditures for agriculture, rural areas and farmers this year will total 339.7 billion yuan, 42.2 billion yuan more than last year," said Premier Wen in his Report on the Work of the Government. This figure is 14.2 percent more than that of last year.

He also said that China would work resolutely to reorient investment by shifting the government's priority in infrastructure investment to the countryside. This mainly involves strengthening the basic development of farmland, with the focus on small water conservancy facilities; improving the system of flood control, drought resistance and disaster reduction; accelerating the construction of infrastructure projects such as roads, drinking water supplies, methane facilities, electricity grids and communications; improving the living environment in rural areas; and accelerating the development of rural public services, such as education, health and culture.

Among the measures to be taken to accomplish these goals are: higher allocations from the central and local government budgets and credit funds, integration of all agricultural investments to improve capital performance, guiding farmers to invest capital and labor in public welfare facilities that benefit them directly, encouraging and guiding the investment of non-state funds in rural development and gradually establishing an appropriate, stable and effective investment mechanism.

Specific plans have been laid out for central budget resources such as the following:

Rural education: Over the next two years, tuition and miscellaneous fees for all rural students receiving compulsory education will be eliminated. Central budget expenditures for compulsory education will increase by 218.2 billion yuan over the next five years.

Rural healthcare: Establishment of an adequate rural healthcare system will be speeded up. More than 20 billion yuan has been earmarked for the next five years to renovate hospital buildings in towns and townships and in some counties and to upgrade their equipment.

Establishment of a new type of rural cooperative medicare system will also be accelerated. Ongoing trials will be extended to 40 percent of the counties this year. Central and local governments will increase allowances to farmers participating in the system from 20 yuan to 40 yuan. The central budget will set aside 4.73 billion yuan for this, representing a seven-fold increase over last year. It is expected that by 2008, this new system would have covered all rural areas.

Subsidies: Direct subsidies for grain production, subsidies for growing superior grain strains and subsidies for agricultural machinery and tools will be provided to farmers. This year, direct subsidies for grain production will top last year's by more than 1 billion yuan. Subsidies for growing superior grains and for agricultural machinery and tools will also be increased by a large margin.

Poverty alleviation: The Central Government will give more financial support to less developed regions this year. Budgetary support to central and western regions will reach 135.9 billion yuan, 23.8 billion yuan more than last year, a year-on-year increase of 21.2 percent. Support to ethnic minorities will amount to 20 billion yuan, 4.077 billion yuan more than 2005, rising 25.6 percent year on year.