How to Innovate the Investment and Financing Systems and Mechanisms for Basic Construction of Farmland Water Conservancy

Accelerating the basic construction of farmland water conservancy is an important guarantee and important support for realizing agricultural modernization. After many years of construction, all localities and departments have implemented the central government's decisions and arrangements on water conservancy infrastructure, and the capacity for disaster prevention and mitigation and comprehensive production capacity have been greatly improved. 50% of China's farmland has already become high-yield and stable-yield farmland that guarantees harvests despite drought or excessive rain. However, the lagging development of China's basic construction of farmland water conservancy remains the biggest weak point. General Secretary Xi Jinping has repeatedly called for vigorously developing farmland water conservancy and resolving to make up for the accumulated shortfalls. In his important instructions on the basic construction of farmland water conservancy, Premier Li Keqiang stressed the need to deepen reform, continuously innovate investment and financing systems and mechanisms, attract and drive more social funds, and mobilize farmers' enthusiasm. It is necessary to advance major project construction, accelerate the improvement of the water conservancy infrastructure network, strengthen management and reform operating mechanisms, and ensure that farmers benefit over the long term. Innovating investment and financing systems and mechanisms is of great significance and plays a major role in strengthening the basic construction of farmland water conservancy. The author puts forward several suggestions on innovating the diversified investment and financing systems and mechanisms for the basic construction of farmland water conservancy.

First, adhere to government leadership and give play to the government's main role in investment. Government investment must be increased, especially investment in the construction of major water conservancy projects. For major water conservancy projects in which the private sector is unable to invest, the state must assume the main responsibility for investment. During the 13th Five-Year Plan period, plans must be formulated and investment further increased. Local governments must also increase their investment responsibilities and do a good job in water conservancy construction planning within their regions. Second, broaden the fundraising channels of government departments and state-owned enterprises. For example, Yunnan Province allocated 5.12 billion yuan in special water conservancy funds from land transfer revenue, and the provincial tobacco department invested 12 billion yuan. PPP was used to invest in 10 projects, with a total investment of 34 billion yuan in funding support. Therefore, it is necessary to improve the institutional measures for allocating special water conservancy funds from land transfer revenue and increase the functional support of various departments. Third, increase financial support. A variety of measures must be adopted, including fiscal interest subsidies and preferential policies, to encourage financial institutions to increase investment in the basic construction of farmland water conservancy. Fourth, replace subsidies with awards and use various preferential policies to attract social capital. Governments at all levels must adopt measures such as replacing subsidies with awards, fiscal interest subsidies, government purchase of services, risk compensation, and PPP to attract social capital investment. Fifth, involve farmers' cooperative organizations. Water use associations and water use management organizations should be established to participate in water conservancy construction. Sixth, deepen reform. Deepening reform is the key to eliminating institutional and mechanism obstacles and managing water conservancy well. It is necessary to issue opinions on water price reform, improve the water price mechanism, provide subsidies based on water use standards, clarify the property rights system and income system for social capital investment, and create conditions for expanding social capital investment.