Central Bank felicitates Jaffna farmers

by Gamini WARUSHAMANA

The Central Bank (CB) felicitated farmers of Jaffna who successfully continue with farming having obtained a high yield in the last Maha season. The farmers were mobilised under the CB’s Poverty Alleviation Micro Finance Project.

Representatives of 30 farmers’ societies in the Jaffna district, (majority were women), had been invited to the ceremony hosted by Governor Ajith Nivard Cabraal for an experience sharing visit to farming areas in the South last week.

Central Bank Governor Ajith Nivard Cabraal welcoming the farmers

According to CB estimates the value of the vegetable and fruit harvest which came to the market from Jaffna during the last two years is over Rs.20 billion.

Food prices especially, prices of onion, vegetables and chilies sharply dropped from its peak in February and March due to these supplies of the Northern farmers, the Assistant Governor of the Central Bank W.M Karunarathne told the Sunday Observer. “Our credit program was begun in 2008 in the Eastern province and in 2009 in the North.

In the North the program was launched even before the A-9 road was opened.

Our objective was to improve livelihoods of the people in the conflict affected North East provinces”, he said.

Today, after two years we can see steady growth in our agriculture lending in Jaffna during every season.

In Yala 2009 we began the program with 600 farmers and disbursed Rs.80 million credit. In Maha 2010 14,200 farmers obtained agriculture loans and we disbursed Rs.1.6 billion.

The main banking partner of the program in Jaffna is the Bank of Ceylon, the leader in agriculture lending who holds a 90 percent share. One important factor for the rapid growth of agriculture in Jaffna is the opening of the A 9 road. It brought the market in the South.

According to CB estimates vegetables and fruits have been cultivated in over 6,000 hectares in Jaffna.

The people of Jaffna have successfully restarted their livelihoods and earn a high income. The loan repayment rate is 100 percent and they closely work with commercial banks that facilitate the program, obtaining credit through other credit programs of the banks as well.

Financial inclusion of the poor is another objective of the program and that aspect too has been successful.

Under the program 30,978 low income families have been connected with the banking system. The credit scheme provides loans at 8 percent annual interest rate to the farmers by the commercial banks while the government provides 6 percent interest subsidy to the commercial banks. This is a part of the government’s rehabilitation program in the North and East.

Karunarathne said that income of the people of Jaffna have increased which is witnessed by the booming trade in Jaffna city. “The city is regaining its pre conflict glory. Around 80 motorbikes are sold in Jaffna every week. Demand for jewellery, building material, equipment and other capital goods witness fast recovery” he said. “The objective of this credit program was to eradicate extreme poverty in the Jaffna peninsula by 2013 and we are reaching our target”, he said.