The manifesto of the National People’s Power (NPP) stated that it would build “a thriving nation, a beautiful life” by creating a productive economy and eliminating waste and corruption. Such an objective cannot be achieved in the first budget itself, but the budget can indicate whether the government is moving towards that objective.

Unfortunately, the NPP government’s current policy directions do not reflect even the beginning of a decisive break from the neoliberal pattern of underdevelopment that Sri Lanka has followed since 1977. The government is broadly proceeding within the framework of the 17th IMF programme which has not even been renegotiated.

The IMF does not consider development at the social level, and is not concerned with integrated development and structural transformation. Its narrow framework is designed to lock countries in a debt trap of underdevelopment and dependency. Its policy cocktail is antithetical to industrialisation and modernisation of the economy, which alone can uplift the livelihoods of Sri Lanka’s people.

The NPP’s current focus and budget proposals appear to be short-term, prioritising immediate survival over long-term planning, with no coherent strategy or vision for the future. In doing so, it is advancing the same economic agenda as preceding governments which offers no escape from the current crisis. Without a shift in direction, the country risks descending once again into chaos.

The Asia Progress Forum proposes the following measures be taken to provide immediate relief to the people, and to lay the groundwork for future sovereign development of the country:

Repeal laws that violate Sri Lanka’s economic sovereignty

The government is constrained by the harsh conditions of the 17th IMF programme, entered into by the previous government. The following laws imposed by the IMF have severely constrained our economic independence: The Central Bank Act No. 16 of 2023, The Public Financial Management Act No. 44 of 2024, The Economic Transformation Act No. 45 of 2024, and the Public Debt Management Act No. 33 of 2024. A Commission of Inquiry should be appointed to investigate the circumstances under which these laws were enacted and the possibility of undue foreign pressure. These laws have placed severe constraints on the government’s fiscal and monetary autonomy and should be repealed.

Establish a development bank for manufacturing industries – A key campaign proposals by the NPP was the establishment of a development bank. This proposal was also an unfulfilled promise of the Sri Lanka Podujana Peramuna (SLPP) government. Sri Lanka is one of the only countries in Asia without a state-owned development bank. History has shown that development is not possible without national provision of credit for domestic manufacturing industries. Therefore, the establishment of a state-owned development bank is an utmost priority.

Stabilise agriculture and food sovereignty

In view of the crisis in the rice market, the government should allocate funds to revive the Paddy Marketing Board (PMB) so that it can challenge the monopoly of private mill owners and middlemen. In the future, PMB should be used to buy paddy at a competitive price from farmers and distribute it to the people. PMD reserves should be released to the market to prevent hoarding by private monopolies.

Promote fisheries – As fish is a major source of local protein consumption and many families depend on the fisheries sector, the government should allocate funds to improve our cold storage and transport facilities. The government may consider installing Fish-aggregating devices (FADs) in identified locations in Sri Lanka’s EEZ based on spatial data. FADs increase fish catch and helps to bring down fuel costs for fishing vessels. Funding for the existing programme to provide all fishing vessels with electronic identification should be augmented to combine it with communications equipment to signal distress and to report to trawlers on locations of fish shoals.

Support workers in FTZs

Funds should be allocated to provide public facilities, including housing, sanitation, and healthcare services to the workers in the Free Trade Zones. As these workers are essential for the country’s capacity to generate foreign currency, better provision of public services will be beneficial to both the workers and the export sector by mitigating days lost due to physical and social ailments.

Debt relief for SMEs and victims of microfinance

The government should support restructuring or write-off of private debt, borrowed by micro/small/medium enterprises under transparent criteria. Small businesses which have been affected badly by the crisis should receive government funding (in the form of soft loans) and other support to ride out the crisis.

Fair taxation – The IMF-mandated tax reforms have disproportionately targeted the incomes of workers through regressive taxes such as VAT. The budget should introduce a reasonable taxation system in which the corporates and the super-rich are taxed proportionately. The PAYE tax threshold should be increased with the gap between tax slabs wider than what it is currently. Corruption and inefficiencies in tax administration should be immediately addressed. Caution must be exercised in plans to introduce a Digital Service Tax (DST) and a Global Minimum Tax (GMT). DST should not be structured in a way that transfers the tax burden to consumers. Extensive consultation should be done before agreeing to a GMT, which has been demonstrated as disadvantageous for developing countries.

Increasing wages – Wages in Sri Lanka have not risen in a level commensurate with inflation. Therefore, wages board minimum wages for public and private sector employees should be increased to match the real cost of living. A national insurance scheme should be established for own-account workers such as seamstresses and carpenters.

National audit of unutilised resources

The government should undertake a nationwide audit of underutilised national assets and resources including land, buildings, machinery and equipment. A plan should be formulated to put these resources to productive use, with the added benefit of providing employment.

These proposals point to the beginning of the change of direction needed to secure Sri Lanka’s long-term development potential. The crisis that Sri Lanka is in necessitates a return to rational planning of the economy and development of state capacity to implement proactive industrial policies. Blind faith in the market and the existing private sector is insufficient to drive structural transformation and uplift the lives of Sri Lanka’s citizens. Part of such a strategy will also require Sri Lanka to rekindle its ties with the Global South through organisations such as BRICS and the Belt and Road Initiative.

(Asia Progress Forum is a collective of like-minded intellectuals and activists dedicated to building dialogue that promotes Sri Lanka’s sovereignty, development, and increasing engagement in South-South cooperation. APF may be contacted at asiaprogressforum@gmail.com)

The Senaka Bibile Medicinal Drug Policy is the answer to the present severe shortage of medicines in the government hospitals. As a result, most patients have to purchase their medicines from private pharmacies. The price of these medicines has soared to such an extent that the poor are unable to afford them. This is particularly the case for those with chronic conditions such as diabetes where they need to take medicines daily. This leads to a flaring up of these severe illnesses resulting in premature death. Sri Lanka is going back towards the situation that existed before the 1970s, when Senaka introduced his policy. Then the Drug Companies controlled the global and local markets and the Health Department had to abide by their terms. The majority of the patients suffered as a result.

 How did Senaka change that situation through his Policy? He found that various the Drug Companies were purchasing from the few producers of the Generic drugs at a low price and making a huge profit by giving them a brand name and capturing the market. Let me give you an example. The widely used generic product Paracetamol is sold under various Brand names by the different Drug Companies at a huge profit. Senaka set up the State Pharmaceutical Corporation (SPC) with the support of the Finance Minister, Dr N.M Perera, and Minister T. B. Subasinghe. The SPC used the List of Essential Drugs, about 233 (at that time) which had been prepared by Senaka, out of about 1,000 or more available in the market. They obtained the Government health sector requirement from the Medical Supplies Department (MSD). In addition, Senaka made an estimate of the requirement of the Private Health Sector and this was added to the State Sector requirement. Then the SPC called world-wide tenders for the total requirement of essential generic drugs, like paracetamol, for the coming year for Sri Lanka as a whole. Because this was a large amount Senaka was able to get at a very low -price good quality generic medicines for all the people in Sri Lanka. The State Health Sector requirement was given to the MSD. For the Private Sector Senaka set up the Osu Sala at Lipton Circus, Colombo. To reach the people in the rest of the country he chose reliable private pharmacies to whom the Osu Sala out sourced the SPC medicines as its agent. This acted as a pressure on the other private pharmacies to bring down the price of Drug Company products like Panadol, Panadeine etc.

Senaka was keen on developing countries like Sri Lanka not having to depend on imports from abroad and mooted the idea of manufacturing the medicines. For this he set up a State Pharmaceuticals Manufacturing Corporation (SPMC). This was able to produce about 43 drugs due to the efforts of Dr. Gladys Jayawardena, who as DDGLS in the Health Ministry stepped in to carry his work forward. Senaka was also very keen as Professor of Pharmacology to ensure that medical students would practice good medicine when they passed out as doctors. So, he set up a Formulary Committee that produced an excellent Hospitals Formulary as a proper guide in clinical pharmacology. Senaka was an excellent teacher and he never brought any notes into the class room but he was ensuring that the students got his message, by repetition or expanding his message. Senaka shifted to Peradeniya University when it was establishing the Medical Faculty and became the first Professor of Pharmacology. He was an educationist and introduced many new teaching methods.

 Senaka was born in remote Bibile. His father was a Rate Mahattaya. He obtained a scholarship to enable him to study at Trinity College, Kandy. Once he became a doctor the first thing, he did was to repay his scholarship so that a poor student could get the chance that he obtained. It was at Trinity that he got interested in social service and upliftment of the poor. He was attracted to the Lanka Sama Samaja Party (LSSP) and its struggle against British Imperialist rule. He joined the LSSP while at University and made an excellent study of Marxism/Leninism. As a medical student I formed a Socialist Society and used to take a group of interested students to his house in Rajagiriya on bicycles. He gave us some good talks on socialism and encouraged us to be critical before accepting his ideas. In the LSSP he took to active politics and became the Treasurer of the Youth Congress. When racial attacks against the LSSP were at its worst during the anti-Tamil Language riots he volunteered to contest a bye-election for the Kuppiawatte Ward in the Colombo Municipal Council. When we went canvassing for him, we were abused as supporters of Tamil also being made an official language with Sinhala. But he did not give in and stood up for the correct policy of the LSSP, knowing that he would lose. My admiration for Senaka soared. But the acceptance by WHO of his Medicinal Drug Policy and sending him to various poor countries to start the process gave him greatest satisfaction. I remember the time when he was to make what turned out to be his final visit abroad to the Caribbean countries and South America. My wife Kamini and I went to his house for dinner with him and his wife Leela. He gave his jovial laugh and said, “Tissa sees how the drug company lobby is trying to frighten me to give up my mission. I have got several calls warning me not to go tomorrow as there is a plot to kill me.” I told him that he should remember that they will not be happy to lose their profits and he should be careful. He left the next day on his mission. It was in Guiana that they killed him by giving him a chemical at a dinner which led to a very rapid heartbeat. With his previous history of ischemic heart disease this could have a fatal outcome. There was some delay in getting him to hospital, and even there he was kept on the trolley for a long time without being seen by a doctor, despite all Leela’s appeals. Kamini and I went to Katunayake to receive Leela with Senaka’s ashes. One of the saddest days in my life. Senaka was only 54 years old when he was killed. He had a lot more energy in him to serve the people and fight for a socialist future for mankind. On this 13th of February we thank him for what he did for the poor people of the world. It will never be forgotten.

 Tissa Vitarana

General Secretary of the LSSP

By Lalin I De Silva

This article intends to explore how Value Chain Management (VCM) can optimise cost structures in Sri Lanka’s paddy farming sector; to present innovative rice-based products that can create new markets and improve public health; to analyse global best practices in rice VCM and how Sri Lanka can adapt them and to propose policy measures for utilizing underutilised government warehouses to support rice-based industries.

Rice farming in Sri Lanka has remained stagnant in its methodology for decades. With rising input costs, inefficient farming techniques, and a lack of diversification in rice-based products, farmers struggle to remain profitable while consumers lack access to healthier rice alternatives. The tea industry faces a similar crisis. The government’s role has primarily been reactive, providing subsidies rather than fostering a sustainable model that ensures profitability and nutritional benefits for both growers and consumers.

The adoption of Value Chain Management (VCM) has transformed rice industries in many countries, offering insights into how Sri Lanka can restructure its rice sector. By modernizing supply chains, integrating technology, and promoting value-added rice products, Sri Lanka can transition from a subsidy-dependent rice economy to a self-sustaining and profitable industry.

10 Ways to Reduce Paddy Farming Costs Using Value Chain Management:

Precision Agriculture

: Implement satellite and drone-based monitoring to optimise irrigation and fertilizer use, reducing input costs.

Direct Farmer-Market Linkages

: Establish digital marketplaces for farmers to sell directly to wholesalers, bypassing middlemen.

Mechanisation & Shared Services

: Introduce cooperative-based ownership of harvesting and planting machinery to reduce individual capital costs.

Integrated Pest Management (IPM): Reduce chemical dependency by using biological pest control methods.

Efficient Water Management:

Dr. W. G. Somarathne
Value Chain Consultant
at www.vivonta.lk

Adopt System of Rice Intensification (SRI) methods to cut water usage by 30-50%.

Use of Organic Fertilizers & Biochar:

Reduce reliance on expensive chemical fertilizers by producing compost and biochar.

Cluster Farming:

Group small-scale farmers into cooperatives for bulk buying of inputs and collective bargaining power.

Post-Harvest Loss Reduction:

Invest in proper storage facilities to minimise wastage and maintain grain quality.

Blockchain for Supply Chain Transparency

: Implement blockchain technology to track rice production and prevent price manipulation.

Hybrid Rice Varieties:

Introduce hybrid rice with higher yields and better disease resistance to increase productivity per acre.

10 Innovative Rice-Based Products for Healthier Consumption:

Rice Flour: Alternative to wheat flour, reducing gluten-related health issues.

Rice Noodles: A popular and easily digestible staple in many Asian diets.

Rice Bran Oil: A heart-friendly cooking oil with high antioxidant properties.

Rice-Based Baby Food: Nutritious and easily digestible food for infants.

Rice Milk: A lactose-free, plant-based milk alternative.

Rice Crackers: A low-calorie, high-fibre snack.

Fermented Rice Beverages: Gut-friendly probiotic drinks.

Rice Protein Powder: A plant-based protein supplement for fitness enthusiasts.

Rice Paper Wraps: Used for making healthier wraps and spring rolls.

Puffed Rice Cereals: A fiber-rich breakfast option.

How 10 Countries Have Successfully Used VCM in Rice Farming:

China: Digital platforms connect farmers directly to consumers, eliminating middlemen and ensuring fair pricing.

India: Government-supported Minimum Support Price (MSP) policy guarantees stable income for farmers while promoting organic farming.

Vietnam: Focus on hybrid rice varieties and export-driven policies making it a global rice hub.

Thailand: Investment in premium rice branding (e.g., Jasmine rice) to fetch higher international market prices.

Japan: Uses contract farming models where food companies directly work with farmers to ensure quality and fair compensation.

Philippines: Rice research institutions work closely with farmers to enhance yield through high-tech solutions.

Bangladesh: Encourages farmer-led cooperatives and shared equipment ownership models.

Indonesia: Government-backed storage and logistics networks reduce post-harvest losses.

USA: Heavy investment in genetically modified (GM) rice varieties and precision farming.

Brazil: Integration of rice farming with aquaculture to maximise land use and increase profitability.

Utilising Government Warehouses for New Rice-Based Industries:

The government owns several underutilized warehouses that can be repurposed for rice processing industries.

Installing modern rice milling and packaging facilities will allow farmers to sell polished rice directly.

Warehouses can serve as hubs for producing rice-based products such as rice flour, noodles, and cereals.

Cold storage facilities can preserve rice bran for oil extraction instead of it going to waste.

Collaborative partnerships with private investors can transform these warehouses into rice innovation centers.

How Both Farmers and Consumers Can Benefit from VCM:

Farmers:

Higher income through value-added rice products rather than selling raw paddy.

Reduced dependence on chemical inputs and expensive machinery.

Improved market access through digital platforms.

Consumers:

Access to healthier, diverse rice-based products.

Stable rice prices due to improved supply chain efficiency.

Nutrient-rich rice alternatives that promote better gut health.

Sri Lanka’s rice industry is at a crossroads. By shifting from a conventional production model to an advanced Value Chain Management approach, both farmers and consumers stand to gain. The government must take proactive steps to modernize farming practices, support rice-based industries, and encourage product diversification. Learning from global best practices, Sri Lanka can transform its rice and the Plantation sectors into profitable and sustainable industries, ensuring food security and economic growth.