Sri Lanka - Govt. Converts Fertiliser Subsidy Into An Allowance

07.12.2015 339 views
The inaugural appropriation bill of the new government that was presented in parliament recently has attracted both praise and criticism by many. Amongst the many controversial facts that are mentioned in the 2016 budget, reforms have been made to the fertiliser subsidy that is considered as one of the most discussed topics that have a direct impact on the farming community.
As a country that is heavily immersed in agriculture, farmers have always been given prominence. However, in a controversial move, the present government has, in the budget 2016, decided to convert the fertiliser subsidy in to an allowance of Rs. 25,000. This decision has been widely criticised and this many includes the farmers.However, the government has claimed that the contribution made by the agricultural sector towards the country’s economy has drastically declined during  the past few years. According to  statistics, by 2014 the contribution of agriculture in the economy was only 10 percent.  It was stressed that since the amount of harvest received from one hectare is low, Sri Lanka is unable to compete in the International market. Expressing his views regarding the matter, MP Ven Athuraliye Rathana Thero has stated that the excessive use of chemical fertilisers is behind the increasing number of kidney diseases in  areas where paddy is cultivated. Accordingly, it is said that a majority of environmental issues such as water pollution is caused due to the excessive use of fertiliser. During former President Mahinda Rajapaksa’s era, the government  initiated the fertiliser subsidy system under the ‘Mahinda Chinthana’ programme. The expenses were divided between the farmer and the government as 10 percent to 90 percent The government allocated Rs. 300,000 million for the subsidy. However, due to an additional charge of Rs. 150 for insurance,  the farmers were compelled to pay Rs. 500 for the fertiliser. This scheme was subjected to criticism as allegations were made regarding the low quality of the fertiliser. Presenting the 2016 budget, the Finance Minister Ravi Karunanayake said that there was no direct connection between the fertiliser subsidy and the  production of paddy in the country.  He said that even with subsidies the farmers are still being exploited in society. Therefore, the government has proposed to offer an allowance of Rs. 25,000 to farmers who cultivate paddy lands below one hectare, for the two seasons. In 2015 the government allocated Rs. 37,000 million for the fertiliser subsidy and this year it has been increased to Rs. 37,000 million. The new allowance is given to small scale farmers who grow paddy in lands  that comprise less than one hectare for one year. Accordingly, only Rs. 12,500 will be given per season. The allocation for one acre is Rs. 5,000. One acre can produce two bushels of paddy. A sack of Urea costs Rs. 2,466 in the market. Claiming that by allowing the allowance to be decided on the ever soaring market price, the farmers have alleged that the government is trying generate extra revenue for the state by taxing the fertilisers. When calculated, only Rs. 2,500 can be allocated for one bushel of paddy and the farmers have alleged that they cannot find fertiliser for such a low price. Previously, the ‘monopoly’ on fertilisers was placed in the hands  of the  government. Even the importation of fertilisers by the private sector was done under government supervision. Farmers claim that these problems would not be solved by providing  this allowance. If the farmers decide not to use fertilisers in cultivation it would have serious effects on the harvest. However, the problems in the agricultural sector must be taken seriously since it affects the entire society in the long run. Therefore, it is the duty of the good governance government to pay attention to the farmers’ plea. At present, farmers have launched protests in the  Dambulla and Embilipitiya areas against the government’s decision. Recently, a national scheme on agriculture policy was initiated by the Minister for Agriculture Duminda Dissanayake. The subsidy on fertiliser is a key topic that must be added to the national policy. The Farmers Federation alleges that the Minister has so far been unable to respond to their requests. Attempts made by The Sunday Leader to contact the Minister were  unsuccessful. Source - http://www.thesundayleader.lk
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