Beijing, Dec 26 (IANS): China is stepping up fiscal spending on the development of agriculture as well as on the improvement of farmers' livelihoods, in an effort to bridge gaps of wealth distribution and urban-rural development in the world's second largest economy.

Xie Xuren, minister of finance, said Sunday that fiscal spending from the central government for agriculture-related projects and farmers is likely to top 1.04 trillion yuan (over $160 billion) this year, which represents a 21.3-percent surge compared to the figure last year.

To boost agricultural development, the fiscal expenditures have served the construction of more water-related facilities at farmlands and consolidation of small reservoirs, reported Xinhua.

The central government has also urged financial institutions to increase lending to agriculture-related businesses through incentive policies, Xie said at a national finance work conference held Sunday in Beijing.

Around 227 billion yuan of funds have been appropriated to help impoverished farmers.