News
Leading rice miller stops paddy purchasing citing losses, PMB still out of picture
By Sanath Nanayakkare
Leading rice miller, Lankeshwara Mithrapala says he has suspended purchasing paddy because it is not proper to purchase paddy from farmers at prices lower than Rs. 120 per kilo, and if he did purchase at that price, he would have to absorb a loss of Rs. 23 from each kilo of rice.
This is happening at a time the government has declared a certified price for paddy at Rs. 120 and the state-run Paddy Marketing Board (PMB) is keeping itself completely out of its main task of purchasing paddy from farmers to ensure a competitive and fair price to them.
When asked if there was some connivance between government officials and private millers to enable the purchasing of paddy at the lowest prices imaginable, Mithrapala said,” We don’t want anyone’s help to run our rice mills. But we can’t buy paddy at Rs. 120 per kilo and let the end-consumer buy a kilo of rice at Rs. 220-230 because of the loss we have to absorb in the process. There are various other brands, Nipuna, Araliya, Lak Sahal etc. If they could buy paddy at Rs. 120, they would because this is a competitive business. But they can’t buy at that price either because that would cause a substantial loss,” he said.
“If the government starts purchasing paddy, the farmers will be relieved,” he said.
Responding to queries, he said: “I bought paddy at Rs. 118-119 about 3-4 days ago. We can’t ask for paddy from farmers at prices lower than that. So, I decided to stop purchasing paddy and produce rice from existing stocks and release them to the market. It is better to stop buying paddy if Rs. 120 can’t be paid for a kilo of paddy. So, the government must intervene,” he said.
When asked if his business was running at a loss, he said,” I have enough money to operate my businesses. But I don’t have funds to collect and keep paddy stocks. What I am saying is that I will purchase paddy at Rs. 120 and will give rice at Rs. 220 per kilo. But to do that the government must declare a six-month moratorium on bank loans. If we have money to buy paddy stocks we would do so without seeking bank facilities because working with our own capital would bring us higher returns. But what do we do if we don’t have money?”
Elaborating on his costing issue he said: “When you buy paddy at Rs. 120 a kilo, there are other costs to take into calculation to run the business sustainably. It takes 1.6 kilos of paddy to produce a kilo of rice. This means the paddy cost itself would be Rs. 192. So when you buy at Rs.120, it actually costs Rs. 192 for paddy alone. For each kilo of rice; Rs. 7 for packaging, Rs. 7 for transport, Rs. 3.50 for electricity, Rs. 8.50 for employee salaries and food, Rs. 10-12 for bank interest.
Then there are the EPF and ETF payments and wear and tear costs of machinery. All these need to be calculated and recovered. These costs amount to about Rs 46 per kilo of rice. Effectively, therefore, the total cost of a kilo of rice is Rs. 238. But we sell to retailers at Rs. 215 and they sell at Rs. 220.
“So, this means that we are releasing our stocks to the market at a loss. That’s why we are saying that we can’t buy paddy at Rs. 120,” he said.
Meanwhile, a group of farmers in Polonnaruwa said: “We are compelled to sell our paddy to private sector traders because the government is just sitting around leaving the big rice millers to buy paddy. When the government does not come forward to break the monopoly of the private traders, we have no option but to sell our harvest to them at lower prices. When we sell them paddy at Rs. 100 a kilo, the income from one acre of paddy is only about Rs. 200,000 ,which is not enough to cover our inputs and labour cost. Big rice millers are making the most of this situation.”
The warehouses of PMB still remain closed and farmers have not been informed whether it would enter the market to purchase their paddy.A source familiar with state sector banking told The Island that PMB had outstanding loans of over Rs. 2 billion payable to the state banks.
News
Courtesy call by the Heads of Mission- Designate on Prime Minister
The heads of mission designate to Sri Lanka paid a courtesy call on Prime Minister Dr. Harini Amarasuriya on 26th of March at the Prime Minister’s office.
The delegation comprised Dharshana M. Perera, High Commissioner – designate of Sri Lanka to Malaysia, Ms. Dayani Mendis, Ambassador and PRUN – designate of Sri Lanka to Austria, Ms. N.I.D. Paranavitana, Ambassador – designate of Sri Lanka to Ethiopia & African Union, Prof. (Ms.) M.I. Fazeeha Azmi,Ambassador – designate of Sri Lanka to Iran, Saman Kumara Chandrasiri, Ambassador – designate of Sri Lanka to Israel, and M. Farook M. Fawzer, Representative – designate of Sri Lanka to Palestine.
The Prime Minister, Dr. Harini Amarasuriya, extended her best wishes to the Heads of Mission–designate and underscored the importance of their forthcoming assignments in advancing Sri Lanka’s national interests emphasizing their collective role in contributing towards the socio-economic upliftment of Sri Lanka.
The Prime Minister further highlighted the importance of projecting a positive and credible image of Sri Lanka internationally, through consistent, professional, and strategic engagement in their respective host countries and multilateral platforms.
She encouraged the Heads of Mission to actively identify and facilitate high-quality investment opportunities, particularly in sectors aligned with Sri Lanka’s development priorities, with a focus on sustainability, innovation, and long-term value addition.
Particular emphasis was placed on the promotion and diversification of Sri Lanka’s exports, including the exploration of new markets and strengthening trade linkages.
The meeting was attended by the Secretary to the Prime Minister, Additional Secretary to the Prime Minister Ms. Sagarika Bogahawatta and heads of mission-designate.
[Prime Minister’s Media Division]
News
SC finds Keheliya, others, guilty of violating FRs of public through corrupt drug procurement deal
The Supreme Court yesterday held former Health Minister Keheliya Rambukwella and several senior health officials liable for violating the fundamental rights of the public over a controversial drug procurement carried out under the 2022 Indian Credit Line.
Delivering the judgment, a three-judge bench, headed by Chief Justice Preethi Padman Surasena, and comprising Justice Kumudini Wickremasinghe and Justice Janak de Silva, found that the procurement of medical supplies from an unregistered company, in breach of established procedures, had resulted in a serious infringement of public rights.
The Court ruled that the granting of a Waiver of Registration by the authorities was “wrongful, arbitrary and capricious,” and held that the direct procurement carried out on an unsolicited basis was unlawful. The transaction was accordingly declared null and void.
In a significant order, the Court directed Rambukwella to pay Rs. 75 million in compensation to the State from his personal funds.
The then Health Ministry Secretary Janaka Chandragupta and former Chairman of the National Medicines Regulatory Authority (NMRA), Prof. S. D. Jayaratne, were each ordered to pay Rs. 50 million.
The Court further directed NMRA Chief Executive Officer Dr. Wijith Gunasekara and former Director of the Medical Supplies Division Dr. Thusitha Sudarshana to pay Rs. 50 million each as compensation.
The ruling followed the hearing of a fundamental rights petition filed by Transparency International Sri Lanka and two other parties.
The Court also instructed the Commission to Investigate Allegations of Bribery or Corruption to initiate appropriate action under the Anti-Corruption Act against those found responsible.
Senior Counsel Senany Dayaratne, with Nishadi Wickramasinghe, Lasanthika Hettiarachchi, Janani Abeywickrema and Maheshika Bandara, appeared for the petitioners.
News
Sajith nudges govt. to follow India’s example in giving relief to consumers by slashing taxes on fuel
Opposition and SJB Leader Sajith Premadasa yesterday urged President Anura Kumara Dissanayake to reduce taxes on fuel, just as the Indian government has done.
He said in a post on X that “Modi government has decided to reduce the Special Additional Excise Duty on petrol and completely remove it for diesel in order to cushion the hardship on the Indian consumer. High time for Anura Kumara Dissanayake to keep up to his election promise and follow suit.”
Meanwhile foreign media reported that India has slashed excise duties on petrol and diesel to protect consumers and rein in a potential spike in inflation, while imposing windfall taxes on aviation fuel and diesel exports, amid volatile global oil markets, as a result of the Iran war.
Global oil prices have surged past $100 per barrel after the near closure of the Strait of Hormuz, which serves as a conduit for 40% of India’s crude oil imports, since the US and Israel first struck Iran on February 28.
In a government order, released late on Thursday, India’s Finance Ministry reduced the special excise duty on petrol to three Indian rupees ($0.0318) per litre from 13 Indian rupees earlier. It also cut the duty on diesel to zero from INR 10 rupees per litre.
The government did not say how much the duty cuts would cost. The move comes ahead of elections next month in four Indian states and one federal territory, with Indian voters known to be extremely sensitive to higher prices.
“Government has taken a huge hit on its taxation revenues to ensure very high losses of oil companies, approximately 24 rupees a litre for petrol and 30 rupees a litre for diesel, at this time of sky high international prices, are reduced,” Indian Oil Minister Hardeep Singh Puri said in a post on X.
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