China unveils broad rural revitalization plan

By Ben Blanchard

BEIJING (Reuters) - China promised on Sunday to boost agricultural production and farmers' incomes when it unveiled a broad policy document to revitalize its rural areas, which have lagged behind the rest of the nation's economic boom.

Central to the scheme will be allowing farmers to transfer their land-use rights, the official Xinhua news agency said in a lengthy report, detailing reforms already announced by Beijing.

China's rural citizens, who number more than 730 million according to a 2006 census, own the product of their land but not the land itself, and are barred from trading their land-use rights under current laws.

"The new measures adopted are seen by economists as a major breakthrough in land reforms initiated by late leader Deng Xiaoping 30 years ago to avail farmers of opportunities to conduct scale management and new business operations," Xinhua said.

The plan was agreed upon at a meeting of the ruling Communist Party earlier this month, and is part of a policy to double disposable income of rural residents to more than $1,200 by 2020 from the 2008 level.

"Such transfers of land-use rights must be voluntarily participated in by farmers, with adequate payment and in accordance with the law," Xinhua cited the Communist Party's decision as saying.

Under Deng's reforms, the huge communes that were the jewels of Mao Zedong's communism were disbanded and farmers were allowed to sell some of their produce on the open market, rather than being forced to sell it all to the state.

With the land itself still collectively owned, the present system has been rife with abuses. Local governments have seized rural plots to sell to factories and property developers, often paying only minimal compensation to farmers.

Thousands of protests against land grabs every year have alarmed Beijing, prompting discussions about how to give farmers greater security in their land rights, if not outright ownership.

Xinhua said the government would "severely punish" any actions which "violated farmers' interests."

INCREASED CROP PRODUCTION

Giving farmers more scope to transfer or pool their land into bigger, more modern agricultural operators would boost productivity and accelerate urbanization, economists say.

Such land transfers have already been spreading, formally and informally, in recent years.

Aside from the land-use transfer plan, the government wants to spend more on rural infrastructure and increase crop production.

"The Party encourages farmers to undertake the collective growth of cotton, sugar plants and potatoes in areas with suitable resources and environment," Xinhua said.