Thursday 6th February, 2025

The JVP-led NPP government has announced certified prices of paddy at long last. Minister of Agriculture K. D. Lalkantha said yesterday that the Paddy Marketing Board (PMB) would purchase nadu, samba and keeri samba varieties at Rs. 120, Rs. 125 and Rs. 132 a kilo, respectively. Curiously, there was no mention of a certified price of red/white kekulu paddy.

Announcing the certified prices at which the PMB intends to purchase paddy is one thing, but purchasing paddy, as promised, is quite another. Does the PMB have enough storage facilities to maintain adequate stocks of paddy, which the government says, will be milled and sold to the public to prevent market manipulations by unscrupulous millers? Complaints abound that many PMB warehouses are still in a dilapidated state.

Farmers’ associations have taken exception to the certified paddy prices announced by the government. They are demanding higher purchase prices. But the government has to look at the bigger picture and factor in the interests of rice consumers as well when certified paddy prices are determined. Balancing the competing interests of those two groups is no easy task, especially ahead of an election. The government ought to provide a detailed or itemised cost estimation so that one will be able to see if it has calculated the paddy production costs properly.

Why did the government take so long to announce the certified prices of paddy? It is being claimed in some quarters that about 25% of the paddy harvest had been gathered by Wednesday (05). Opinion may be divided on the amount of paddy so far harvested, but a large number of farmers had to dispose of their produce at prices ranging from Rs. 80 to 90 a kilo in several districts for want of guaranteed prices.

The government recently claimed that it had delayed the announcement of the guaranteed prices of paddy purposely for the sake of farmers, who, it said, were selling their produce at prices as high as Rs. 140 a kilo. But farmers have rubbished this claim; they have said none of them could sell their paddy at such high prices, and the delay on the part of the government only enabled a group of large-scale millers with political connections to purchase paddy at unconscionably low prices. They have alleged that the government waited until the wealthy millers had finished purchasing paddy to announce the guaranteed prices. Successive governments have done so to enable the powerful millers to maximise their profits at the expense of both rice consumers and paddy cultivators. Whether the incumbent administration will be able to convince the public that it is different from its predecessors remains to be seen.

The onus is on the warring farmers’ associations and the Opposition, which is shedding copious tears for rice growers for political reasons, to prove that there arose a genuine need for higher guaranteed prices of paddy than the ones that prevailed before last year’s regime change; they should prove that the cost of producing a kilo of paddy has increased since September 2024 or so, when the average price of a kilo of rice was about Rs. 170. Were the increases in rice prices during the past several months due to an actual increase in the cost of production? Or, were they due to other factors such as hoarding by large millers? The Opposition, which demands a purchase price of at least Rs. 140 per kilo of paddy, has attributed the steep hikes in rice prices to a secret deal between the big-time millers and the government, hasn’t it? How will it reconcile the aforesaid allegation with its claim that the cost of producing paddy has increased?

Meanwhile, the government has said the certified prices of paddy are aimed at maintaining the maximum retail prices of rice at the current level while looking after the interests of the farmers. The public has been protesting against the prevailing rice prices, which they consider extremely high. Is it that the government has no plans to bring down the rice prices to the previous levels?

Wednesday 5th February, 2025

Rice is more than a food item for Sri Lankans; it is a kind of politico-cultural staple. Hence its ability to make or break governments. One of the key factors that led to the 1953 Hartal was a steep rise in the price of rice under a UNP government. The then Prime Minister Dudley Senanayake had to resign when protests went out of control. The SLFP-led United Front government came to power in 1970, promising to make rice freely available at affordable prices even if it were to be brought from the moon, of all places! However, that promise went unfulfilled, and rice shortages, among other things, led to the collapse of that dispensation.

Interestingly, an increase in the price of rice due to a subsidy cut, inter alia, under another UNP government, gave a big fillip to the early growth of the JVP as an alternative to the traditional leftist parties in the late 1960s. About six decades on, a democratically elected JVP-led government is facing a kind of existential problem over some unresolved issues concerning rice. It is a double whammy for the JVP; both rice consumers and paddy farmers are demanding that their competing interests be addressed.

Rice growers are threatening to march on Colombo and stage what they call Aragalaya II unless the government ensures that they get a fair price for their produce without further delay. They have been berating the government for serving the interests of some wealthy millers at the expense of the farming community. The Opposition, true to form, is fishing in troubled waters.

Opposition Leader Sajith Premadasa has been urging the government to set the guaranteed price for paddy at Rs. 140 a kilo. If the government acceded to his demand, how much would a kilo of rice be? Will Premadasa provide an answer?

True, the government is seen to be serving the interests of some big-time millers, who always have the last laugh. People voted the JVP-led NPP into office because they wanted it to deal firmly with all those who were exploiting them. The government has baulked at taking on the millers. However, its difficulties should be appreciated. It is in a Catch-22 situation. It cannot increase the purchase price of paddy without causing the rice prices to increase. Similarly, it cannot bring down the rice prices without lowering the paddy prices.

The government is in the current predicament because it is dogged by the slogans the JVP/NPP used during its opposition days to mobilise farmers against the previous administration. When current Deputy Minister of Agriculture Namal Karunaratne was in the opposition, he pressured the SLPP-UNP government to ensure that paddy fetched Rs. 150 a kilo. Now, he is drawing heavy flak from his erstwhile fellow agitators, who are demanding that the NPP government carry out what it asked its predecessor to do.

It behoves the government and agricultural experts to get their costing right. The average price of rice was about Rs. 170 per kilo when the NPP came to power late last year. The purchase price of paddy was below Rs. 100 per kilo at that time. Rice growers demanded higher prices for their produce, but they reconciled themselves to the market conditions, the implication being that they were either breaking even or earning profits at least marginally; otherwise, they would have taken to the streets, led by the JVP/NPP. The average price of rice increased beyond Rs. 250 per kilo subsequently and the government moved in to cap it at Rs. 230. Has the cost of producing paddy increased steeply since last year’s regime change for the protesting farmers to demand an increase in the purchase price of their produce?

It is only natural that farmers strive to get the highest possible price for their produce, but cost calculations should be done scientifically for a guaranteed price for paddy to be determined. The government should pluck up the courage to stop dilly-dallying and grasp the nettle. Procrastination will only make matters worse.

Tuesday 4th February, 2025

All arrangements have been made for Sri Lanka’s 77th anniversary of Independence to be celebrated on a grand scale today. Interestingly, Independence is being celebrated under a government that is experiencing an inner conflict over when the British colonial rule actually ended in this country. Prior to its ascent to power, the JVP insisted that Sri Lanka had not ceased to be a British colony in 1948; the transfer of the reins of government from the British to a group of Brown Sahibs could not be considered true Independence, and Sri Lanka remained in colonial shackles to all intents and purposes until 1972, when the first republican Constitution was introduced. The government finds itself in an ideological bind in respect of Independence.

Independence Day is an occasion to reflect on the past 77 years and take stock of the challenges that lie ahead. Nothing is further from the truth than the claim that Sri Lanka has not achieved anything since 1948, and the post-Independence era has been a curse. True, misgovernment, corruption and economic mismanagement have brought about the present sorry state of affairs, but the country has not been without post-Independence achievements.

It is a textbook example of irony that Sri Lanka is celebrating Independence while preparing another national budget under the instructions of the International Monetary Fund, and seeking financial assistance from international lending institutions and donor nations. What is described as the largest-ever World Bank loan granted to Sri Lanka is being flaunted as an achievement! What is this world coming to when a country celebrates debt restructuring, foreign loans and aid from other nations?

The ‘Granary of the East’ has had to import rice–this time around, not due to a drop in the national paddy production, but because of the government’s failure to free the public from the clutches of a ruthless millers’ cartel, which is accused of hoarding paddy. Coconut imports are also on the cards. Whether a country that cannot even maintain adequate stocks of salt is equal to the task of investing in the agricultural sector and achieving self-sufficiency in food is the question.

It may not be too cynical a view that the only sector that is booming in Sri Lanka is its state service, which is so huge that there is one public official for every 15 citizens! There are already about 1.5 million state employees, but 30,000 more are to be recruited to the public service under the current dispensation, which has also promised substantial public sector salary increases.

Despite promises of reform, the incumbent government has fallen into the same rut as its predecessors, perpetuating the dependency culture for political expediency in the name of relief provision. It is expected to present an election budget shortly with an eye to winning the upcoming local government polls.

It is time for making difficult decisions to resolve the current crisis, and the need for the rulers and their political opponents to share in the suffering of the people who are making numerous sacrifices in the name of economic recovery cannot be overstated. The least they can do is to give up some of their perks and privileges and reduce the cost of government.

The focus of ongoing efforts to turn the country around has been on political and economic reforms. The near-collapse of the economy has caused economic reforms to get underway in earnest, and much is being spoken about moves to ‘create’ a new political culture. Such reforms are no doubt essential, but the attainment of the country’s desired economic and political goals consists in an effective social reform movement, which alone can bring about a radical attitudinal change in the public, promote rational thinking, and enhance national productivity, the be-all and end-all of economic development.