| Agriculture is fundamental to the economy, while the food industry is the base of agriculture. It is a top priority for the Chinese government to ensure that the industry develops well and all the Chinese people have enough food. In 2004, the central government launched series of policies beneficial to farmers, which lowered the farmers' burden and motiva ted them to grow more grain. Especially the policy of direct subsidy for grain in 2004 and comprehensive direct subsidy for agriculture in 2006 contributed a lot to promoting the grain production and ended the situation that the area and output of grain production declined continuously in the past few years. However, as the development of the economy and improvement of the people's living, the intense situation between the demand and the supply in different regions and different kinds of grain will be more serious. There is new situation for keeping the food industry safe and we need to pay more attention to the potential risk.Though the policy of direct subsidy for grain enacted in 2004 have contributed a lot to motivating the farmers to grow more grain and keeping the food industry safe, there exists many problems during the implementation. The first is the double policy target of promoting grain production and increasing the farmers' income. The local government and farmers don't have a clear understanding of the policy target. The second is that the level of subsidy is too low to motivate the farmers to grow more grain. The third is that the group who receives the subsidy is unreasonable, considering the widely-existed land transferring. The fourth is that the basis for subsidy during the implementation is too complex and variable. The fifth is that the supporting system for the policy is not robust, which increases the cost of implementation.From the perspective of improving the existing policy, this paper states that the long-term goal of the policy of the direct subsidy for grain is to increase the farmers' income. However, constrained by the fiscal ability, the policy will still focus on stabilizing the farmers'earning for grain production and promoting the food production in short term. On the basis of defining the policy goal, the paper suggests that we can combine the subsidy fund of the three kinds of direct subsidies for grain to solve the problem of low subsidy level. From the perspective of motivating farmers to grow more pain, we also should choose the farmers growing the grain as the group who receives the subsidy. To encourage the farmers to sell more grain and narrow the gap of subsidy level between different regions, the paper suggests that we could combine the area of grain production and sales volume of grain by farmers as the basis for subsidy. And the paper has a discussion about how to proportion the subsidy fund between central and local government and how to define the subsidy level. Finally, for the high cost of implementation, the paper suggests to strengthen the supporting system such as legislation on subsidy, collection on the fundamental data.The paper is divided into five parts:the first part concerns about the background, subject, situation, methods and implications. The second part concerns about some theories for grain subsidy such as reasons, types, purposes, goals and mechanisms. The third part concerns about the experiences of some typical countries in grain subsidy, which will give some implications for the improvement of China's grain subsidy policy. The fourth part concerns about the reforming history of China's grain subsidy policy. In this part, the paper will give more explanation about the existing policies and the existed problems, which is the base for making advices. The fifth part concerns about the advices on how to improve the existing grain subsidy policy. In this part, from the perspective of keeping the food industry safe, the paper makes some suggestions on the group receiving the subsidy, the basis for the subsidy, the level for subsidy and the supporting system. |
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