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| Wednesday, 9 July 2003 |
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Capital Goods imports to boost agricultural production By Ravi Ladduwahetty The Government will import agricultural implements under the Indian Line of Credit in a bid to slash costs of agricultural production, a prelude to reaching the ambitious economic growth rate of 8 percent from 2004. The Ministry of Rural Economy has received Cabinet approval for the import of 1,000 tractors as a preliminary measure towards this end. The import of these tractors has become imperative is that agricultural production costs have risen sharply due to the high costs of hire as farmers cannot to by them outright. The rational underpinning the import of these tractors is that it will be available at around Rs. 310,000 cheaper than the market rates. This is the first time that 1,000 tractors will be released to the national economy in one instance, Minister of Rural Economy and Deputy Minister of Finance Bandula Gunawardena told a news conference at the Treasury auditorium yesterday. He explained that it will be the Ministry that will be importing these tractors and that the process has been transparent. The Ministry has received bids from 11 Indian tractor manufacturing companies and the criteria which have been considered is compatibility to Sri Lankan conditions, price, popularity and the after sales service. The Government has decided on three premium brands - John Deere, Tafe and Mahendra which have been manufactured under joint venture collaboration with US and UK based manufacturers. The import of these tractors will also have an influence on the prices of two wheel tractors, he said. The advertising in the national media has evoked over 600 responses upto now and it is very likely that the total demand will exceed the four figure mark, he said. The Government will give priority to Local Government bodies and farmer organisations and also to those who pay the funds up front. It will be totally interest free while there will be a service charge of 0.5 per month, he said. Asked by this newspaper as to why these tractors were sold at exorbitant prices prior to this, he said that the demand for four wheel tractors was less and the large companies had to price them high to cover their overheads. The Minister explained that the decision of the PA Government to allow the import reconditioned tractors which were over 20 years old has resulted in limitations which were no where near the gradually increasing demand. He said that the imports were: 1,257 in 1994, 1,708 in 1995, 1,799 in 1996, 2,024 in 1998, 1,437 in 1999, 1,268 in 2000, 570 in 1997 and 949 in 2001. The reason for the drastic reduction in the import of these tractors were that it had been revealed that these tractors which had come into the country in the last two years had been over 40 years old. |
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