The 4.8 billion yuan ($703 million) that the Chinese government newly allocated for rural healthcare infrastructure may look unimpressive in comparison with the multi-trillion-yuan investment plans announced by the Ministry of Transport and the Ministry of Railway.

But the small size of this specific budgetary fund does not detract from the importance of such government expenditure. Improving rural healthcare with public fund would be a sure way to encourage people to save less and consume more.

That is even more crucial to the country's long-term development than building more roads and railways.

According to the Ministry of Health, this year the central government will spend another 4.8 billion yuan on new buildings and medical equipment in more than 13,000 clinics and hospitals in rural areas.

Admittedly, the sum of the special fund does not make a big share of the additional 100 billion yuan the Chinese government vowed to spend before the end of this year to boost economic growth, not to mention the 4 trillion yuan ($586 billion) economic stimulus package it announced for the next two years.

But with such healthcare infrastructure investment, chances increase that more needed money can be promptly pumped into rural areas to substantially improve medical services for farmers.

Inadequate rural healthcare has hindered prevention and control of major diseases in rural areas and thereby undermined health conditions of rural residents.

As a result, unfortunately, rural families just lifted out of poverty have often been impoverished again by huge costs of medical treatment when some of their members have to travel to cities to seek treatment without any insurance.

On the other hand, as the income gap between urban and rural residents keeps widening, most medical facilities and personnel are concentrated in cities, especially in the metropolises.

If China is to pursue sustainable and harmonious development, the vast rural areas can definitely not be left behind.

That is why the Chinese authorities have recently set a goal of doubling farmers' income by 2020 from this year's level. And in the draft plan for healthcare reform, the government promised to set up a "safe, effective, convenient and affordable" medical system that would cover all urban and rural residents by 2020.

At a moment when the country needs to boost domestic demand rapidly to cushion the economy against the impact of shrinking external demand, more efforts must be made to tap the huge potential of the vast but currently underdeveloped rural market.

Hence, policymakers should ensure that the increased budget for rural healthcare infrastructure is just the beginning of massive government spending to transform the rural economy into an important growth engine.

(China Daily November 25, 2008)