Supplementary estimate to continue fertilizer subsidy

Uditha KUMARASINGHE and Irangika RANGE

Agriculture Development and Agrarian Services Minister has presented a supplementary estimate seeking parliamentary approval to obtain Rs. 2500 million to continue with the fertilizer subsidy to safeguard the country's agricultural sector in the face of global economic recession.

Although a financial provision of Rs. 25,000 million has been allocated to the Agriculture Development and Agrarian Services Ministry through Budget estimates 2009 for the payment of the fertilizer subsidy including paddy, that amount is not sufficient to bear the cost for 2009, the clarification on the proposal presented by Minister Maithripala Sirisena said.

In addition to providing chemical fertilizer for paddy farmers in keeping with the Government policy of supplying fertiliser on subsidy basis, mixed fertilizer is given to tea smallholdings as well.

Accordingly, 50 kg of mixed tea fertilizer is sold at a subsidiary price of Rs. 1200 considering the urea content in mixed fertiliser that is recommended for tea smallholdings.

Meanwhile, Finance Minister through his memorandum to the Cabinet under reference 09/0164/306/009 on the subject of "Country's Economy" Enhancement package and Foreign Exchange Receipts and saving promotion package has proposed to sell mixed tea fertilizer at a subsidiary price of Rs. 1000 per 50 kg bag. The Cabinet at its meeting held on 28-01-2009 has approved this proposal which is estimated to cost of Rs. 2500 million.

Therefore it is necessary to allocat a provision of Rs. 2500 million for tea fertilizer subsidy in addition to the provision of Rs. 25,000 million already allocated to the Agriculture Ministry for the payment of the fertilizer subsidy.