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PMB declines to release Rs 1.2 bn FD for paddy purchasing

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Treasury forced to bear responsibility for Rs 2 bn in loans

By Shamindra Ferdinando

State Finance Minister Ranjith Siyambalapitiya has said that the State Banks weren’t in a position to release funds to the Paddy Marketing Board (PMB) as the enterprise owed them a staggering sum, running to over Rs 20 bn.

Due to the failure on the part of the state enterprise to settle previous loans, the Treasury has been compelled to accept the responsibility for repaying them, the State Minister said.

The Kegalle District lawmaker said so on the live political programme, Salakuna, telecast on Hiru on Monday night. The State Minister was responding to interviewer Chamuditha Samarawickrema’s query regarding the inordinate delay on the part of the government to implement the paddy purchasing scheme.

Referring to Agriculture Minister Mahinda Amaraweera’s abortive efforts to obtain the required funding, lawmaker Siyambalapitiya said that the Treasury was helpless.

State Minister Siyambalapitiya said the PMB couldn’t be faulted for the crisis as successive governments had directed the state enterprise to purchase paddy at a higher price, then ordered it to sell at a much lower price, thereby causing staggering losses.

The State Minister also acknowledged management level shortcomings and political interventions caused the ruination of the PMB.

The PMB owed the Bank of Ceylon and the People’s Bank Rs 1,600 mn and Rs 690 mn, respectively.

The State Minister acknowledged that the issue couldn’t be resolved in spite of interventions made by President Ranil Wickremesinghe and Premier Dinesh Gunawardena. Referring to a subsequent discussion he had with the Secretary to the Treasury Mahinda Siriwardana, lawmaker Siyambalapitiya said that the BOC has asked for Rs 1.2 bn fixed deposit as security though the PMB declined to do so. According to the State Minister the PMB asserted that it couldn’t forgo the fixed deposit as the

interest received was utilized for day to day running of its operations.

The State Minister said that the banks could release the required funding on the basis of a guarantee given by the Treasury. The lawmaker explained the inability on the part of the Treasury to give such a guarantee as further deterioration of public finance could have a devastating impact on the banking sector. Such an eventuality couldn’t be allowed, the SLFPer said.

The Minister acknowledged that the failure on the part of the government to launch a paddy purchasing scheme would dishearten the farmer community.

Chamuditha Samarawickrema pointed out that the private sector had managed their ‘operations’ in a much better way.

The State Minister said that the situation was so bad that of the recent Rs 93 mn public sector salary bill, the government could meet Rs 82 mn. The government had no option but to ask those state enterprises to pay salaries from their funds, pending repayment, the MP said, reiterating the Treasury couldn’t help the PMD at the moment.

Responding to further questions, the State Minister said that the government would definitely give priority to the PMD issue once they finalized public sector salary payments. The Minister urged the media not to pursue an agenda detrimental to the government’s recovery efforts. Asked to explain, the State Minister said that there had been accusations the government didn’t purchase paddy to clear the field for the private sector. The Hiru team pointed out that the banks had released substantial amounts to the private sector to purchase paddy. The Minister explained the banks tried their best to help but circumstances were such the government couldn’t help at the moment.



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Maldives Coast Guard Ship Huravee arrives in Colombo

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The Maldives Coast Guard Ship Huravee arrived at the Port of Colombo for replenishment purposes on 02 Mar 26. The visiting ship was welcomed by the Sri Lanka Navy (SLN) in compliance with time-honoured naval traditions.

The ship is a 48.9m long Offshore Patrol Vessel which is commanded by Lieutenant Colonel Ahmed Nafiu Mohamed.

Meanwhile, the ship’s crew is scheduled to visit several tourist attractions in the city of Colombo, during their stay in the island.

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AKD warns of far reaching economic consequences of Middle East war

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Anura

President Anura Kumara Dissanayake yesterday called for an immediate and peaceful resolution of the escalating Middle East conflict, warning that the crisis could have far-reaching repercussions on the global economy, including Sri Lanka.

Addressing Parliament, the President stressed that no military conflict benefited humanity, particularly at a time when destructive military technologies were rapidly advancing.

“Any military conflict does not create a favourable situation for any group of people,” he said, urging all parties to make urgent commitments towards peace. “As Sri Lanka, our position is that all parties involved in this war must, as soon as possible, take steps toward a peaceful world.”

He cautioned that Sri Lanka could not remain insulated from the fallout from the conflict, noting that disruptions to global oil and gas supplies, threats to migrant workers in the Middle East, and potential shocks to tourism, remittances, shipping and aviation were real concerns.

A national programme was being formulated to mitigate the impact, he said, adding that its success would hinge on broader international efforts to restore stability, the President said.

Acknowledging public anxiety shaped by past economic hardships, President Dissanayake said social stability could not be ensured through rhetoric alone but required tangible guarantees that citizens would not face another crisis.

While noting that the government had successfully navigated multiple challenges since assuming office, he described the Middle East situation as distinct due to the uncertainty surrounding its duration and outcome.

The government, he said, was closely monitoring developments. The Central Bank had conducted a review with a report on the likely economic impact expected shortly. The Ministry of Finance is also preparing an assessment of the potential effects on public life, alongside measures to ensure the uninterrupted provision of essential services locally and for Sri Lankans overseas.

“The primary responsibility for finding a path out of the crisis rests with the Government,” he said, calling on Parliament and the public to collectively confront the challenge under a unified national plan.

Providing a detailed account of the country’s energy reserves, the President said storage capacity rather than supply remained the key constraint. Excluding the Indian Oil Corporation tanks in Trincomalee, total storage capacity at Kolonnawa and Muthurajawela stands at approximately 150,000 metric tons.

Diesel stocks were currently sufficient for 33 days, with refining contributing around 1,800 metric tons daily. Petrol reserves will last 27 days, with a 35,000 metric ton shipment due on March 7 or 8 expected to extend availability to around 40 days.

Aviation fuel stocks are adequate for 49 days, supported by both daily refining and imports. Scheduled shipments include vessels from RM Parks on March 14, Sinopec on March 17, IOC on March 21 and the Ceylon Petroleum Corporation on March 28.

Crude oil supplies were sufficient to operate the refinery for 26 days, with an additional shipment expected to extend operations by a further 18 days, the President said.

“Because of this, there is no crisis regarding oil,” the President assured Parliament.

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Pope invited to visit Sri Lanka

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President Anura Kumara Dissanayake has invited His Holiness Pope Leo XIV to visit Sri Lanka.

The official invitation was handed over by Minister Bimal Ratnayaka to the Vatican’s Under Secretary for Relations with the States, at the Vatican, yesterday, during the Minister’s official visit to Italy, the President’s Media Division said.

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