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| Wednesday, 19 May 2004 |
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Working towards price stability Groung realities by Tharuka Dissanaike Ironic that so soon into power the government should be pondering about importing rice. The JVP had to oppose it of course. The mere suggestion is anathema to a party that rode on the waves of farmer support, assuring them of a better deal in subsidies and crop purchase. Just last year we had surplus production. We had so much rice that it became a problem. And now? A shortage? A JVP MP assures us not. There is no shortage, just that farmers are loathe to sell rice for low prices. So they are stockpiling rice wherever they can, waiting for a more favourable purchasing climate. Meanwhile the consumer pays a high premium for a basic staple grown in this country. Who makes the money? As in most goods, the middlemen- mill owners, large wholesalers- rake in the money leaving both the farmer and consumer suffering. The farmer waits for the purchase price to increase (especially now that THEIR government is in power); the consumer meanwhile prays that the price will come down, at least not increase any further. The government, in characteristic helpless fashion, comes out with a brilliant plan. Import rice. The plan is neither good nor original. There has to be better way to control the market for rice, to manipulate it intelligently and systematically so as to avoid these wild fluctuations in price that leave the consumer and farmer both defeated. Other countries, with much larger agriculture and even diverse private sector interaction manage to keep essential food prices stable. There is no secret mantra or witches brew to make it happen. What it needs is a committed public sector, good stable policies and minimum political interference. Some price control is essential in the case of rice- and other staples- grown/ farmed here in Sri Lanka. Leaving the open market forces to determine prices has led to continuous calamity in the agriculture sector for many many years. If the Government claims to have price control mechanisms- CWE?- then it is obvious they are not working. Last year, when farmers were threatening to burn their rice on the main roads of rural towns, the government hastily released money to buy and stockpile rice. (If we still have those stocks this may be a good time to release them into the market.) But in reality, purchasing centers were turning farmers away. Forcing impoverished cultivators to sell to local businessmen at low, low prices. Today, instead of looking deeply into the matter to find a long-term solution to rice purchase, storage and proper distribution throughout the year, the state contemplates importing. This is not the time for knee-jerk reactions. It is time for those learned politicians that we ushered in to Parliament and senior bureaucrats who have witnessed this problem from all angles, to sit together and strategise for better price stability in the future. For the farmer and for the common consumer. A long-term solution is a lot better than decreased prices tomorrow, only to be faced with a new crisis in six months. |
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