CORRECTED-Funding drought curbs Australia's "food bowl to Asia" ambitions

Mon Mar 10, 2014 12:15am EDT
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(Corrects to make clear FIAL still has base funding; collaboration funding frozen)

* Lack of state grants, blocks to foreign investment hurting

* Rapidly growing Asian middle class the target

* Innovation needed for high-quality, value-added production

* Chinese investors deterred by uneven playing field

By Jane Wardell

SYDNEY, March 10 (Reuters) - Australia's lofty ambitions to become a "food bowl" for a rapidly growing middle-class in Asia are in danger of falling at the farm gate due to the country's harsh, drought-prone climate and a lack of investment in agricultural innovation.

The federal government has touted the food bowl plan as one way of diversifying the economy as a decade-long mining boom that brought the country riches wanes.

But the industry says it has been left between a rock and a hard place - with state grants denied and foreign investment blocked, it lacks the funding needed to transform Australia into a provider of high-quality, value-added produce.   Continued...