Aug. 15 (Bloomberg) -- India will increase farm spending by at least 250 billion rupees ($6.14 billion) to boost agricultural output and ensure the benefits of economic growth reach every citizen, Prime Minister Manmohan Singh said.

The government will also spend more on education, health care and rural development, Singh said in a speech to mark India's 60th independence anniversary in New Delhi today.

Singh said the welfare of farmers is a core concern and that the urban-rural divide needs to be bridged.

India's $854 billion economy has grown at an average pace of 8.6 percent in the past four years, making it the world's second-fastest growing major economy. Singh wants to boost output from farming, the sole employment for about 235 million people, by 4 percent this financial year, from an estimated 2.73 percent in the year ended March 31.

``Apart from overall contribution to the national income and helping in the attainment of the goal of food security for all, a strong and robust growth in agriculture can help reduce rural poverty,'' India's President Pratibha Devisingh Patil said in a speech on the eve of the anniversary yesterday.

Singh's government is aiming to accelerate economic growth to 10 percent by 2012, to generate more jobs and improve the lives of the people. The World Bank estimates half the country's 1.1 billion people live on less than $2 a day.

Employment Opportunities

Industrialization is the most effective means to create new employment opportunities, Singh said today. While the transition to an industrialized economy from a farm-dependent one has its costs, the government will ensure that farmers won't suffer, he said.

Communist-ruled West Bengal province, which is wooing investors to stem an industrial decline, is facing resistance from farmers unwilling to give up their land for factories, townships and export zones. The government's efforts to secure land for a $224 million car project of Tata Motors Ltd., India's biggest automobile company, have also run into opposition.

The government will also help provide social security for senior citizens above the age of 65, who are poor. It will widen access to education by setting up 6,000 new schools and help the nation's states start colleges in 370 districts, Singh said.

To contact the reporter on this story: Pooja Thakur in Mumbai at pthakur@bloomberg.net.

Last Updated: August 15, 2007 00:11 EDT