DHAKA, April 3 (Reuters) - Bangladesh will give its farmers free fertiliser and seeds to boost cultivation of rice watered by rain and so protect the environment, the country's agriculture minister said on Wednesday.
Bangladesh, the world's fourth biggest producer of the grain, consumes almost all its production at home. In January, amid soaring prices of the staple, it backtracked on a plan to scrap a four-year old ban on rice exports.
The stimulus package, worth nearly 440 million taka ($5.6 million), would cover more than 300,000 farmers to help produce an additional 111,000 tonnes of the Aus variety grown during the May-August season, Matia Chowdhury said.
"We are encouraging farmers to grow more Aus rice as it matures during the monsoon. So it needs only a little irrigation to cultivate," she told a news conference.
"By growing more rain-fed rice, we can save our environment from disaster," Chowdhury added.
Bangladesh's main rice variety, Boro, whose output last year was 18.76 million tonnes, needs extensive irrigation, which causes water levels to drop.
Bangladesh aims to produce more than 35 million tonnes of rice, including 2.5 million tonnes of Aus, in the current year, up from nearly 34 million in the previous year.
Market insiders blame hoarding by millers and traders for a rise in domestic prices in recent months, despite good crops and stocks.
The south Asian country produces enough rice to feed its population of 160 million, but often needs imports to cope with shortages caused by natural calamities such as floods or droughts.
Although it did not import rice last year, and is not expected to do so this year, Bangladesh was ranked as the fourth-largest importer of the grain by the U.S. Department of Agriculture in 2011, with a volume of 1.48 million tonnes.
Reporting by Ruma Paul; Editing by Anis Ahmed