New Delhi: Prime Minister Manmohan Singh today (Jun 29, 2004) proposed creation of rural business hubs on the lines of Chinese model and revamp of rural development programmes to make agriculture an engine of growth.

"We must examine our rural development programmes afresh," Singh told a Chief Ministers' conference on Panchayat Raj.

"Concerns that we have not been able to unlock varying resource potential of different regions, use funds optimally and make Panchayat Raj institutions effective can all perhaps be addressed by such a policy shift," he said. Regretting that nearly Rs 17,000 crore spent annually on rural schemes is not put to best use, Singh said there is a need to adopt a system of providing grants to districts, based on their incidence of poverty, to plan strategies for optimum use of the resources.

These funds need not be tied to specific schemes but linked to a holistic vision of rural development to make district plan a reality as provided by the Constitution amendment on Panchayat Raj.

Stressing on the need to fulfill the Gandhian vision of decentralised production, Singh said, "We need to learn from the Chinese model of rural business hubs that add value to agricultural produce within the rural area."