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Germany is to increase federal grants for students this year, the new federal education and research minister, Christian Democrat Jurgen Ruttgers, confirmed.

Presenting his priority areas in Bonn, Mr Ruttgers said that he was confident that additional expenditure on federal grants could be afforded by the government.

But he also indicated that the grant system would be under review - for example, the time students were eligible for grants might be shortened. Mr Ruttgers' proposal for higher grants coincides with state governments' calls for a 4 per cent increase in student funding.

Only recently, Peter Glotz, the opposition Social Democrat education spokesman recommended a mere 2 per cent extra for students entitled to federal grants. His suggestion went down badly with his party colleagues - the SPD holds a majority in the upper house, where the state government representatives sit.

In his statement, made in mid-January, Mr Glotz called on the new education and research minister to put more emphasis on the contribution ÖйúAƬ and research could make to industry. New markets needed to be opened, particularly for medium and small businesses in the information, environmental technology and biotechnology areas. It was vital, Mr Glotz maintained, that the research budget should grow faster than other sectors.

Mr Ruttgers also called on industry to provide more money for research projects. Industry's support for research has been flagging over the past few years, despite repeated warnings that the extra funds were vital if Germany was to keep pace with international developments. Mr Ruttgers urged that drastic cuts be made in funding for the European space programme.