A plan aimed at cultivating high-yield and pest-resistant genetically modified, or GM, crops for the country to achieve agricultural sustainability has been approved, said authorities.

The State Council announced on its Web site on Wednesday the approval of the plan, one of 16 key State plans marked by the central government to achieve breakthroughs in their respective fields between 2006 and 2020.

The move comes amid mounting challenges to feed 1.3 billion people against the shrinking arable land and water shortage.

At a meeting chaired by Premier Wen Jiabao, Chinese leaders said the plan was of "strategic significance" in the country's drive to make its agricultural sector more efficient, the statement said.

"Departments must fully understand the importance and urgency of this significant project, further improve the program and waste no time to implement it," the statement said.

The statement gave no details on which crops should be developed.

Experts have said that the approval of the plan clearly showed that the country was attaching more importance to the development of transgenic species.

It also signaled the development of GM crops as a national strategy despite an array of ministerial-level rules covering the area, Huang Dejun, general manager and chief analyst with the Beijing Orient Agribusiness Consultant Co Ltd, told China Daily.

Still, while China has become a major producer of GM cotton and vegetables such as peppers and tomatoes, it has to be "cautious" in pursuing a large-scale production of GM rice, Huang said.

"As rice is a major grain for China and no country in the world applies transgenic technology to its major grains, it should be cautious in developing transgenic rice," Huang said, adding that the country should keep up its research in the field and ready a reserve of the transgenic rice species.

"China has made major breakthroughs in research on transgenic rice, with potential for commercialization," Huang said.

 Xue Dayuan, professor in transgenic technology with the Nanjing Institute of Environmental Science under the Ministry of Environmental Protection, said that the new program will cost 20 billion yuan, or $2.92 billion, with 10 billion yuan funded by the central budget and the rest from other channels.

"Some 20 percent of the total input will be used for the safety inspection of new species and infrastructure construction," Xue told China Business News.

Similarly, the official Catalogue of Industries for Guiding Foreign Investment revised last December made it mandatory that the Chinese side of a joint venture in the field should dominate the company producing new agriculture seeds.

The catalogue bans foreign investment in the development of GM crops in China.

The State Council last week also approved a mid- and long-term grain security plan that aims for the country to be 95 percent self-sufficient in grain over the next 12 years.

The plan set a goal of achieving annual grain output above 500 million tons by 2010, and increasing production to more than 540 million tons a year by 2020.

"Given the shortage in natural resources like arable land and water, as well as the increase in population, transgenic technology is vital to the country's agriculture output and national grain security," Huang said.

Questions:

1. China must be careful in producing what GM grain?

2. How much will the new program for cultivating GM crops cost?

3. By what year does the State Council hope to be 95 percent self-sufficient in grain?

Answers:

1. Rice.

2. 20 billion yuan.

3. 2020