Beijing - China on Wednesday announced an annual budget that aims to promote rural economic growth, curb inflation, and bridge regional and social income gaps, increasing central government spending by 17.8 per cent. In his speech to the opening of the annual National People's Congress, Premier Wen Jiabao said the government will allocate 562.5 billion yuan (79.2 billion dollars) for agriculture and other rural projects from its central budget this year, up 30 per cent from 2007.
"We will continue to adjust the structure of government spending and investment by greatly increasing spending on agriculture, rural areas and farmers, the social safety net, medical and health care, education, culture, energy conservation and emissions reduction, and construction of low-rent housing," Wen said.
Projected central budget revenue is 3.303 trillion yuan (465.2 billion dollars) and expenditure is set at 3.483 trillion yuan (490.6 billion dollars), leaving a deficit of 180 billion yuan (25.4 billion dollars), down 65 billion yuan from 2007.
The budget includes another 17.6-per-cent hike in China's annual military budget, amid US concern following similar large increases in recent years.
The draft defence budget for 2008 is set at 417.769 billion yuan (57.229 billion dollars), up 62.379 billion yuan from 2007, NPC spokesman Jiang Enzhu said on Tuesday.
The rise continues the government's policy of "moderate increases" in defence spending in recent years and is needed for pay rises, extra costs of rations and fuel, training, and new arms to "enhance the military's ability to conduct defence operations under IT conditions", Jiang said.
Wen said military modernization was a "strategic task in developing socialism with Chinese characteristics."
"Our aim is to enable the army to fully carry out its historic mission at the new stage in the new century, enhance its ability to respond to security threats and... staunchly protect China's sovereignty, security and territorial integrity," Wen said.
Many Western critics claim China's real military spending is much higher than its budget figure, with some US analysts estimating actual military spending at up to three times the budget figure.
But Jiang said China's military budget remained below most other major military powers as a percentage of gross domestic product.
The 3,000-member NPC is scheduled to discuss and approve the budget report and Wen's annual economic plan in a "rubber stamp" voting process at the end of its 14-day session.
