Moneragala to double sugarcane cultivation

Over $40m saving on forex annually

by Lalin Fernandopulle

The Bank of Ceylon (BoC) has signed an MoU with the Pelwatte Sugar Industries to launch a Rs. 1.5 billion project to promote sugarcane cultivation in the Moneragala district that would save over US$ 40 million in foreign exchange annually by doubling sugar production.

Though the country's annual requirement of sugar is 500,000 mts only around 60,000 mts are being produced locally. The Government spends over Rs. 12 billion annually to import sugar.A number of by-products from sugar are also imported at a cost of Rs. 5 billion.

BoC Corporate Communication Officer, Dr. Ashoka Jinadasa said the increase in sugar production at Pelwatte from 42,000mt to 100,000mt per annum would not only save foreign exchange but also strengthen the livelihood of over 15,000 sugarcane growers in the area.

Sugar production at Pelwatte will increase by 138 percent. The production of extra neutral alcohol will increase from eight to 18 million litres per year, Dr. Jinadasa said.

Around 15,000 sugarcane growers cultivating 24,000 hectares will each receive Rs. 150,000 repayable in three annual instalments at an interest rate of 9 per cent per annum.

The Pelwatte Sugar Industries will prepare the land, provide the equipment and purchase the produce which would help the sugar production plant to operate at full capacity, he said. As the production of sugar increases the quantity of molasses will go up from 30,000mt to 70,000mt per annum.

The production of alcohol is expected to increase 125 percent exceeding the country's requirement while the Government could earn Rs. 8 billion as excise tax.

The total extent of sugarcane cultivation is around 15,000 hectares of which Sevanagala has 4,000 hectares and Pelwatte 9,000 hectares. The remaining is from the Ampara and Badulla districts. The Kantale and Hingurana sugar factories were closed due to security situations.

Under the 'Gamata Karmantha' program, DANIDA, a Danish International Agency has granted a soft loan of Rs. 185 billion through the BoC to the Pelwatte Sugar Corporation to set up a milk processing plant. The BoC will provide additional funds through its 'Gamata Naya' program for other facilities.

The Pelwatte Sugar Industries will play a key role in developing the livelihood of the people of the Moneragala district, Dr. Jinadasa said.

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