To keep the green going

Govt helps the agrarian sector to survive the global financial crisis in 2009:

Bhagya SENARATNE

The year 2009 saw the global financial crisis creating serious problems to economies all over the world. Its repercussions were felt here too in Sri Lanka, especially within the Small and Medium Enterprises (SMEE). To curb this problem, the Government initiated several key projects within this field.

One such project is the 'Krushi Navodaya' program, which was initiated to meet the capital requirement of the small farmers throughout the country.

The long term aim of this project is to empower these small farmers by providing them financial access to acquire agricultural inputs at an affordable price. Under the 'Krushi Navodaya' loan scheme, a total of around Rs. 2, 323 million have been disbursed among small scale farmers, since the introduction of the program. A sum of Rs. 475 million has been disbursed as loans amongst these farmers in the year 2009 alone. These loans have been made available through major state commercial banks as well as development banks.

In an attempt to enhance the local milk production, the Government launched the 'Agro Livestock Development Program.' Taking in to account the enormous amount of foreign exchange outflow for the importation of milk powder, the Government announced this concessionary loan scheme in the year 2008 for the small dairy farmers. This continued successfully through the year 2009. During this year, approximately Rs. 519.94 million has been disbursed among 4, 332 dairy farmers, in addition to the crop and milk processors.

With boosts to agriculture the economy will flourish

Therefore, the importance of fertilizer for this sector is unfathomable! The Government promoted the use of fertilizer since the latter part of the year 2005, and in an effort to increase productivity, commenced in recognising the respect for food security and poverty alleviation under the 'Mahinda Chinthana' development program. More than 850, 000 farmers engaged in paddy cultivation benefited from this fertilizer subsidy.

The two state fertilizer companies shouldering the responsibility saw to it that the subsidized fertilizer was made available to the paddy sector. The involvement of the private sector too can be seen in the Government initiative to help the farmers with fertilizer subsidiaries. As a result of which, private fertilizer companies have taken the responsibility of handling the fertilizer for the plantation sector, whilst a staggering 133, 219 metric tons of tea fertilizer mixtures have been circulated, within the past year.

The 'Economic Stimulus Package' was introduced by the Government in recognizing the importance of the export oriented industries, as well as attempting to help the Small and Medium Enterprises (SMEE) to curb the effects of the global financial crisis. This provides relief to the industries, while enabling them to overcome their difficulties, stemming from the global economic crisis. Further, a concessionary loan scheme was introduced under this program to tackle the working capital issues of the tea factory owners, resulting from low prices of tea and unsold volumes of made tea.

A serious price reduction was seen in the Cinnamon sector, as a repercussion of the global financial crisis. It is worth mentioning that cinnamon is the fourth highest agricultural export earner of Sri Lanka. The drastic price reduction of the cinnamon affected the cinnamon sector distressing both the producers and the processors, which led to the problem of survival. Therefore, the Government announced the 'Relief Package for the Cinnamon Sector.' Further, through the Export Development Board (EDB) the government hoped to increase the producer price of cinnamon.

Due to the implementation of programs such as the 'Krushi Navodaya' Loan Scheme, Agro Livestock Development Program, fertilizer subsidy, relief package for the tea sector, and relief package for the cinnamon sector, Sri Lanka has been able to curtail major economic downfall, which was experienced by the other countries owing to the global economic crisis.