BEIJING -- The central government of China will spend 391.7 billion yuan on agriculture, rural areas and farmers this year, as it vows to develop modern agriculture and promote the building of a new countryside, said Premier Wen Jiabao in a government work report Monday.

"We will effectively shift the focus of state infrastructure development and development of social programs to the countryside, " Wen told 2,890 lawmakers at the opening meeting of the Fifth Session of the Tenth National People's Congress (NPC), the top legislature.

The allocations from the central government budget will total 391.7 billion yuan this year, an increase of 52 billion yuan over last year and 94.2 billion yuan over the year of 2005.

Agriculture, as the base of the country's economy, remains weak, and it is now more difficult than ever to steadily increase grain production and keep rural incomes growing, Wen said.

The Study Times, a newspaper affiliated to the Party School of the Central Committee of the Communist Party of China, predicted that China could face a 4.8 million ton grain shortage in 2010, almost 9 percent of the country's grain consumption.

Wen said this year's work related to agriculture, rural areas and farmers will focus on accelerating the development of modern agriculture and effectively promoting the building of a new socialist countryside.

A central government document released late January said developing modern agriculture is the top priority in building a new socialist countryside.

China must strengthen government policy, funding, application of science and technology, and reform to develop modern agriculture and promote the building of a new countryside, the premier said.

The premier announced China will set up a nationwide basic minimum cost of living allowance system this year for rural residents, and the trial area of the new rural cooperative medical care system will be expanded to cover over 80 percent of all counties, county-level cities and city districts in China.

Last year, China has made "steady progress in building a new socialist countryside" last year, according to Wen.

Despite serious natural disasters, China last year saw a rich grain harvest with total output amounting to 497.45 billion kilograms, 13.44 billion kilograms more than the year before.

The per capita net income for the 900 million rural residents increased 7.4 percent to 3,587 yuan last year. Safe drinking water was made available to another 28.97 million rural people and the use of methane available to an additional 4.5 million rural families.

The country ended the agricultural tax that had been collected on grain farmers for more than 2,600 years, continued to increase direct subsidies to grain farmers, and followed a policy of granting general subsidies for agricultural production supplies.