The Hindu Business Line : China increases minimum price of rice and wheat

BEIJING: China has increased the minimum purchase price for rice and wheat for the second time this year to spur grain production as part of its efforts to rein in the soaring prices, identified by it as the 'biggest concern.'

The increases were announced by the country's top economic planner, the National Development and Reform Commission (NDRC) a day after the Government pledged to raise by $3.6 billion this year's rural budget to boost farm production.

The minimum price for rice for purchase from farmers would range between $11 to 12 per 50 kgs and for wheat from $10.2 to 11. The Consumer Price Index (CPI), barometer of inflation, had reached a nearly 12-year monthly high of 8.7 per cent in February, driven mainly by the sharp rise in food prices.

In its battle against inflation, the Government had earlier frozen the prices of grain, cooking oil, oil products and other basis goods to cool inflation. Increasing cost of inputs, including fertilizers and seeds, have also contributed to the farm prod uce price rise.

The Chinese Premier, Mr Wen Jiabao said recently that soaring prices remained the "biggest concern" of the Government but expressed confidence that it would be able to hold the CPI at the targeted 4.8 per cent this year, while admitting that it was "not an easy job". - PTI

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