No room for a milk powder price hike - Trade Minister

Mohammed NAALIR

COLOMBO: Trade, Marketing Development, Co-operatives and Consumer Services Minister Bandula Gunawardane yesterday stated that the Government will not allow importers to increase the price of milk powder even a cent above the controlled price of Rs. 275.

"If the companies are not willing to sell milk powder at the controlled price of the Government they can leave the country," Minister Gunawardane told a news briefing.

Minister Gunawardane said that some elements are trying to increase the price of rice to Rs. 150, coconut to Rs.60, a 400 gram milk powder packet to Rs. 300, a gas cylinder to Rs. 2,000 and a pack of cement to Rs. 1,000.

Minister Gunawardane stated that this is a move of the group loyal to LTTE to strengthen Prabhakaran once again.

He said the committee established to look into price changes of essential commodities is continuously observing the market price changes to take proper action to solve issues that arise at any time.

The Government could bring down the price of rice to Rs. 70, coconut to 30. There are sufficient vegetables, onion, potato and other items sold at fair and reasonable prices.

Minister Gunawardane said that for the last 11 months no room was left to increase the price of milk powder. When a US dollar was Rs. 114 a 400 gram milk powder was distributed at Rs. 275 but the US dollar has come down to Rs. 108, so the milk powder distributors can sell at less than Rs. 275.

In addition Minister Gunawardane said that due to the tax subsidy granted on milk powder imports the Government had to undergo a loss of Rs. 542 million, Rs. 577 million, Rs. 605 Million Rs. 462 million and Rs. 448 million respectively from January to May this year.

The Government has to bear a loss of Rs. 90 on a 400 gram milk powder packet.