Buttala farmers to sell produce under forward contracts

New Chamber to fill communication gap:

by Surekha Galagoda

Farmers of Buttala will launch a Chamber of Commerce on September 12 to sell their produce under forward contracts to exporters and buyers with the support and guidance of the National Chamber of Commerce of Sri Lanka (NCCSL).

President NCCSL, D. Eassuwaren said that this was the outcome of a meeting held recently between exporters and producers of vegetables and fruits from Moneragala. The meeting noted that there is a communication gap between the producers and exporters. The producers look for a market only after the harvest.

Another problem was that each farmer has a small plot of land and exporters find it difficult to purchase the required quantities from one producer.

As a solution to overcome all these problems encountered by both parties it was suggested to form a Chamber of Commerce or a cooperative society whereby the producers establish a link with exporters and also establish forward contracts. By this their produce will not go waste and they will get a guaranteed price while the exporters will be able to fulfil their orders.

Eassuwaren said that in our country a fair amount of fruits and vegetables get damaged while in transit and the loss is about 40%. NCCSL is planning to call upon the government to give a subsidy on crates to avoid this waste. This will help the economy as well as the farmer, he said.

Forty farmers and eight exporters participated in the meeting, said Eassuwaren. Outlining the other plans for the NCCSL, he said that they want to give a helping hand to the SME sector as they contribute to a major portion of the economy.

Among the plans are setting up a help desk for the SME sector. Under this program any person who is keen on starting a business can get advice over the phone or by letter on any aspect of the business.

In addition in the National Business Excellence Awards where we honour entrepreneurs we have included a new category to recognise the SME sector.

The NCCSL conducted the Business Excellence Awards for the past four years but until now nobody looked at the SME sector as they do not have a balance sheet to show. We will present them awards based on a different criteria so that they too would feel encouraged to do business, said Eassuwaren.

The Business Promotion Fund, a gift from the Netherlands government to the NCCSL is also to help SME entrepreneurs outside Colombo and Gampaha to purchase machinery.

However they should be engaged in the particular industry for two years, employ a minimum of three people and have a turnover of less than Rs. 10 mln per annum. Eassuwaren said that in the event the entrepreneur is a woman the conditions are more flexible because we want to encourage women entrepreneurs.

He said that if the machine is Rs. 300,000 we give Rs. 270,000 as a grant which they need not reimburse while the balance has to be the entrepreneur's contribution. From Rs. 300,000 - Rs. 500,000 the entrepreneur has to contribute 25% while NCCSL will give the balance.

Up to now we have helped 80 entrepreneurs and we are keen to promote more women entrepreneurs.

Eassuwaren was born in India on August 12, 1942, and completed his education at St. Benedict's College, Kotahena and earned his Bachelor of Commerce degree at Pachaiyappa College, Chennai University of Madras. On completing his studies he joined the family business and in 1964 on the advice of his father he set up Eswaran Brothers as a family partnership to venture into international trade.

Eswaran Brothers Exports (Pvt) Ltd., is the fifth largest tea bag manufacturer in Sri Lanka. The turnover of the company for the year 2005/2006 was around Rs. 700 Million. In 1981 the company won the Presidential Award. Eassuwaren is the Chairman of the company.

He has also set up Mayfair Lanka (Pvt) Ltd., in 1997 as a joint venture with Asian Food Industries, Pakistan to manufacture bubble gum in Sri Lanka.

This is the first and only facility to manufacture bubble gum in Sri Lanka under the Mayfair brand name. A large factory to manufacture injection moulded furniture and crates was set up in Hanwella with renowned Indian Company Nilkamal.

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