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Vice Finance Minister Zhu Zhigang said on Tuesday that China has offered a total of 51.5 billion yuan (US$6.43 billion) in direct grain subsidies to the country's farmers in the past three years.

The vice-minister said China has allocated 39 billion yuan from its grain risk fund for direct subsidies to grain farmers during 2004, and it also earmarked 12.5 billion yuan in direct subsidies in 2006 to alleviate the pressure of price hikes of agricultural production material.

China's budgetary funding for direct grain subsides totaled 14.2 billion yuan in 2006. Addressing a national meeting for officials from central and provincial finance departments, the vice-minister urged local departments to deliver this year's direct grain subsidies and other subsidies to farmers as soon as possible.

China began to offer grain farmers direct grain subsidies in 2004 to encourage grain production and improve farmers' income following consecutive falls in grain outputs leading up to 2004.

China also has offered subsidies to the country's disadvantaged communities, including fishermen and taxi drivers, Zhu said.

China has raised prices of processed oil twice in the first five months of this year.

Following its oil price hikes last March, China raised the prices by over 10 percent on May 24.

China has to balance oil price hikes and assistance to those communities and sectors vulnerable to higher oil prices on the international market.

(Xinhua News Agency June 7, 2006)