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Friday March 1st, 2024

Crisis-hit Sri Lanka to supply fertilizer at 25-pct cost amid looming food shortage

Sri Lanka will supply fertilizer at 10,000 rupees per 50 kg bag for paddy cultivation

ECONOMYNEXT – Sri Lanka will supply fertilizer at 10,000 rupees per 50 kg bag for paddy cultivation, 25 percent of the original cost of 40,000 rupees as the crisis hit nation is trying to boost its rice production amid a looming food shortage after an ill-sighter fertilizer policy.

Sri Lanka’s rice production has dropped sharply since President Gotabaya Rajapaksa banned chemical fertilizers in April last year. Agriculture Minister Mahinda Amaraweera said the rice production has fallen up to 40 percent in the last ‘Maha’ cultivation season ended in February this year.

“Paddy farmers will be given fertilizer for 10,000 rupees and in the global market is selling it for 40,000 rupees,” Amaraweera, also a co-cabinet spokesman told a weekly cabinet media briefing on Tuesday (05).

He also said corn cultivators and other crop producers will be also receiving the fertilizer at the same price in the future.

Before the ban, the government had been providing a 50 kg fertilizer bag at 350 rupees. However, increased global prices and nearly 80% depreciation in the rupee currency against the US dollar have increased the import price of fertilizer.

The lack of fertilizer application has forced the government to import rice from India and Myanmar. The shortage and looming food crisis have increased the prices to more than doubled. Rice is the staple food in the island nation.

Rajapaksa stubbornly maintained the fertilizer ban policy despite many protests by farmers. He was forced to cancel the policy after the production of rice and vegetables started to fall in November. However, the government could not supply the required fertilizer to farmers due to dollar shortage.

Sri Lanka brought an organic fertilizer shipment from China, however it was not approved Sri Lankan authorities because the supply did not meet the required standards.

Later, the government imported nitrogen fertilizer from India, but farmers rejected it because of bad odour.

Amaraweera said Sri Lanka will receive a shipment of 40,000 MT of chemical fertilizer on July 9, from Oman under the Indian Credit Line, this will be distributed to farmers. Another 25,000 MT is expected to be reach the country in the near future.

The fertilizer will be used in the next Maha cultivation season starting in November this year, Amaraweera said adding that Sri Lanka will reach self-sufficiency and will no longer have to import rice.

“We want the next Maha season to be successful and for all this to be carried out we have taken the relevant measures,” the Agriculture Minister said.

He also said the paddy has been cultivated in 475,000 hectare land across the country in the on going Yala cultivation season, much higher than the expected 275,000 hectare. (Colombo/July 05/2022)

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Sri Lanka’s RAMIS online tax collection system “not operatable”: IT Minister

ECONOMYNEXT – Sri Lanka’s online tax collection system RAMIS is “not operatable”, and the Ministry of Information Technology is ready to do for an independent audit to find the shortcomings, State IT Minister Kanaka Herath said.

The Revenue Administration Management Information System (RAMIS) was introduced to the Inland Revenue Department (IRD) when the island nation signed for its 16th International Monetary Fund (IMF) programme in 2016.

However, trade unions at the IRD protested the move, claiming that the system was malfunctioning despite billions being spent for it amid allegations that the new system was reducing the direct contacts between taxpayers and the IRD to reduce corruption.

The RAMIS had to be stopped after taxpayers faced massive penalties because of blunders made by heads of the IT division, computer operators and system errors at the IRD, government officials have said.

“The whole of Sri Lanka admits RAMIS is a failure. The annual fee is very high for that. This should be told in public,” Herath told reporters at a media briefing in Colombo on Thursday (29)

“In future, we want all the ministries to get the guidelines from our ministry when they go for ERP (Enterprise resource planning).”

President Ranil Wickremesinghe’s government said the RAMIS system will be operational from December last year.

However, the failure has delayed some tax collection which could have been paid via online.

“It is not under our ministry. It is under the finance ministry. We have no involvement with it, but still, it is not operatable,” Herath said.

“So, there are so many issues going on and I have no idea what the technical part of it. We can carry out an independent audit to find out the shortcomings of the software.”

Finance Ministry officials say IRD employees and trade unions had been resisting the RAMIS because it prevents direct interactions with taxpayers and possible bribes for defaulting or under paying taxes.

The crisis-hit island nation is struggling to boost its revenue in line with the target it has committed to the IMF in return for a 3 billion-dollar extended fund facility. (Colombo/Feb 29/2024) 

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Sri Lanka aims to boost SME with Sancharaka Udawa tourism expo

ECONOMYNEXT – Sri Lanka is hosting Sancharaka Udawa, a tourism industry exhibition which will bring together businesses ranging from hotels to travel agents and airlines, and will allow the small and medium sector build links with the rest of the industry, officials said.

There will be over 250 exhibitors, with the annual event held for the 11th time expected to draw around 10,000 visitors, the organizers said.

“SMEs play a big role, from homestays to under three-star categories,” Sri Lanka Tourism Promotion Bureau Chairman, Chalaka Gajabahu told reporters.

“It is very important that we develop those markets as well.”

The Sancharaka Udawa fair comes as the Indian Ocean island is experiencing a tourism revival.

Sri Lanka had welcomed 191,000 tourists up to February 25, compared to 107,639 in February 2023.

“We have been hitting back-to-back double centuries,” Gajabahu said. “January was over 200,000.”

The exhibition to be held on May 17-18, is organized by the Sri Lanka Association of Inbound Tour Operators.

It aims to establish a networking platform for small and medium sized service providers within the industry including the smallest sector.

“Homestays have been increasingly popular in areas such as Ella, Down South, Knuckles and Kandy,” SLAITO President, Nishad Wijethunga, said.

In the northern Jaffna peninsula, both domestic and international tourism was helping hotels.

A representative of the Northern Province Tourism Sector said that the Northern Province has 170 hotels, all of which have 60-70 percent occupancy.

Further, domestic airlines from Colombo to Palali and the inter-city train have been popular with local and international visitors, especially Indian tourists. (Colombo/Feb29/2024)

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Sri Lanka rupee closes at 309.50/70 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 309.50/70 to the US dollar Thursday, from 310.00/15 on Wednesday, dealers said.

Bond yields were slightly higher.

A bond maturing on 01.02.2026 closed at 10.50/70 percent down from 10.60/80 percent.

A bond maturing on 15.09.2027 closed at 11.90/12.10 percent from 11.90/12.00 percent.

A bond maturing on 01.07.2028 closed at 12.20/25 percent.

A bond maturing on 15.07.2029 closed at 12.30/45 percent up from 12.20/50 percent.

A bond maturing on 15.05.2030 closed at 12.35/50 percent up from 12.25/40 percent.

A bond maturing on 01.07.2032 closed at 12.55/13.00 percent up from 12.50/90 percent. (Colombo/Feb29/2024)

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