December 29, 2010

China steps up water conservation to ensure grain security

The Chinese government is expected to spend about RMB200 billion (US$30.10 billion) on water conservation projects in 2011, with priority given to improving irrigation to ensure grain security and projects to combat drought and floods.

The sum is a tenth more than in 2010, and some of the investment would come from a 10% levy on income earned from the leasing of land, sources said.

Other funds would go toward renovating water supply infrastructure for main agriculture regions and ensuring safe drinking water for 60 million rural people, according to reports.

The government has invested about RMB700 billion (US$105.6 billion) on water conservation over the past five years.

Chen Xiwen, director of the central government's rural work leading group who advises top leaders on rural policy, said the government would specifically target water conservation next year because of worry about grain production, it said.

While grain production will rise to 546.4 million tonnes this year, up by 15.6 million tonnes on last year, there are worries about next year's harvest because of natural disasters, which could push up food prices, Chen added.

The government is paying close attention to the cost of food after prices rose nearly 12% in the year to November, leading overall consumer inflation to a 28-month high of 5.1%.

"We have to accelerate the construction of water conservation facilities as one of the key infrastructures the country needs to secure increasing grain production. We must address issues arising from the country's rapid urbanisation, which has consumed land that used to be used for farming," he said.

Water shortages this month and the encroachment of urban development on rural land posed challenges for China to extend increases in grain output after seven years of growth, Chen added.