THE Chinese government will increase living allowances for university students to offset soaring food prices, the Ministry of Education announced yesterday.

The Ministry of Finance and the Ministry of Education will raise allowances to 16 million students by 20 yuan (US$2.86) a month from March to June, and by 40 yuan to four million needy students.

The government has subsidized students since 1989, but the amount varies according to the area. In Beijing, it is about 60 yuan for each student a month.

The consumer price index, a key inflation indicator, rose to 8.7 percent in February, led by major price increases in pork, eggs and other agriculture products.

During the four months, the local and central governments will provide 1.92 billion yuan to subsidize 20 million college students.

(Xinhua)