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| Sunday, 30 April 2006 |
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| News Business Features Editorial
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Call to revamp coconut industry by Elmo Leonard
The estimation that 60 to 70 percent of the coconut trees in the island are over 60 years old and senile is incorrect, according to the Coconut Growers' Association of Sri Lanka (CGASL). It is a measure of the incompetency of successive governments to motivate growers to upgrade their plantations and obtain a reasonable return on their investments, CGASL president, Ranjith Dias has written to the Ministry of Coconut Development. The nation has lost the premium prices it commanded in the world market for coconut oil, desiccated coconut and non-kernel products, while the large producer and exporter, British Ceylon Corporation (BCC) went out of business. The industry needs to be revamped. The performance of the coconut industry in Sri Lanka during the last 50 years needs to be compared with the performance of Tamil Nadu and Kerala. In India, the extent of plantations and yields have improved, backed by fertiliser and the building of tube wells, which are heavily subsidised. Sri Lanka's extension of plantations has remained static. The grower gets a better deal in India, while the price of a nut in both countries is the same. CGASL calls for the appointment of stakeholders in the industry on all authorative bodies. A regular flow of funds to meet development programs, outside annual budgetary provisions should be available, coming from a cess fund. A cess fund should be set up between the CDA, CCB and CRI to stabilise activities covering the coconut industry, the report said. There should be short and long term strategies planned out for the coconut industry. The short term should motivate coconut growers to channel resources which would help bring in better returns. The average price of producing coconuts is Rs. 9 to 10 per nut, and a minimum farm gate price should be ensured. The CGASL advocates greater competition in the market for improvement of the industry; revamping the coconut industry would be one measure, the report said. The import tariff for edible oil should be maintained or adjusted depending on CIF prices so that local production of coconut oil is protected. Also, immediate action should be taken to exempt coconut oil from VAT, while desiccated coconut enjoys that exemption. The current price of adult palm mixture (APM) fertiliser Rs. 24,000 per tonne, discourages most growers from applying fertiliser on a regular basis. CGASL recommends a fertiliser subsidy of Rs. 10,000 per tonne on adult and young palm mixture, utilising the cess from imports of edible oil. This would be the quickest process of increasing productivity, Dias said. A package of financial incentives should be given as a means of improving organic content of the soil. For drip irrigating dry lands for coconut cultivation, 40 percent of the cost should be a grant, 50 percent interest free loan for five years, with a grace period of one year with the grower contributing the balance 10 percent. With labour unavailable, assistance should be given to growers to purchase two and four-wheel tractors on interest free loans of 90 percent, and a five-year payback with a grace period of one year. Financial assistance and soft loan facilities should be given to promote intercropping and animal husbandry to enable growers get an additional income, Dias said. |
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