SOVIET UNION SETS 4.5 PCT INDUSTRIAL OUTPUT GROWTH Soviet Planning chief Nikolai Talyzin told the Supreme Soviet (parliament) industrial output is planned to rise by 4.5 pct in 1988, up from a planned 4.4 pct in 1987. In the first nine months of this year, industrial output rose by 3.6 pct. Talyzin said national income, the nearest Soviet equivalent to gross national product, is planned to rise by 4.3 pct against a planned 4.1 pct this year. He said grain production is planned at 235 mln tonnes in 1988, compared with a planned 232 mln this year. The Soviet Union produced 210 mln tonnes of grain in 1986 and the Soviet press has said heavy rain has affected the harvest this year. Talyzin said the 1988 Soviet plan stressed the engineering industry, which Kremlin leader Mikhail Gorbachev has described as a sector where rapid modernisation is essential if the Soviet Union is to compete effectively on world markets. "Certain difficulties have arisen this year in the machine-building industry. The economy is not receiving a considerable amount of the equipment that it requires," said Talyzin, who heads the state planning committee Gosplan. Soviet data show the machine-building industry, which makes machine tools, instruments and other engineering goods, increased output by 3.3 pct in the first nine months of this year against the same period of 1986. This is well below the 7.3 pct rise planned for the industry for all of 1988. Talyzin said the ruling Politburo concluded at a recent meeting that an improvement in economic performance depended to a large extent on conserving resources better. "Large-scale measures are planned to save resources," he said. Finance Minister Boris Gustev told the Supreme Soviet defence spending in 1988 would total 20.2 billion roubles, the same as announced last year. Talyzin said the Kremlin also had decided to increase spending next year on medical services, education, pensions and social insurance schemes He said state expenditures in these fields would reach 171 billion roubles in 1988, or 3.5 billion roubles more than had originally been envisaged in the 1986-1990 Five-Year Plan.