BoC pledges support to reduce country’s food bill
by Surekha GALAGODA
[email protected]
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Gamini Wickremasinghe
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Govi Shakthi credit scheme
Under this scheme loans are given to purchase selected farm vehicles
and equipment, animals and watering mechanisms. More than 4,321 loans
amounting to Rs. 761.33 mln have been disbursed.
Krushi Navodaya credit scheme
This scheme is implemented by the Ministry of Finance and Planning to
empower small farmers by providing access to agricultural inputs at an
affordable cost. Fifty-thousand farmer families will benefit every year.
The loan varies between Rs. 10,000 and 100,000 while the interest rate
is 8% per annum. Already 5,657 loans amounting to Rs. 356.49 mln have
been granted.
Nagenahira Navodaya
The bank has formulated special credit schemes for people in the
East. An action plan has been drawn to provide financial assistance for
communities to re-commence cultivation, livestock, fisheries, coconut
cultivation, and other self-employment activities.
Deevara Shakthi credit and savings scheme
This scheme is implemented to provide sustainable livelihood for the
fishing population of over 800,000. Five-hundred and ninety four loans
amounting to Rs. 55.98 mln have been disbursed for fisherwomen to engage
in gainful occupations such as processing fish, mat weaving, goat and
dairy farming.
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The government has called upon banks to support the country’s
endeavour to reduce the food bill of the country by 10%.
This will help save valuable foreign currency, increase employment
opportunities and make the country march towards self-sufficiency, said
Chairman (BoC) Dr. Gamini Wickremasinghe.
He said that Sri Lanka should have a strong agricultural economy and
we can’t underestimate this fact whatever the circumstances. Up to now
we were able to face and survive all problems due to the country having
food for its people.
As there is a food crisis looming, it is necessary that we grow more
food so that we will be better equipped to face the crisis, reduce
inflation and save foreign exchange.
Dr. Wickremasinghe said to increase the food production the country
should have the latest technology, high yielding planting materials such
as seeds and good agricultural practices.
Since the yields are low we have to use more land for cultivation
which is totally unnecessary but if farmers plant high yielding seeds
the country would be able to reduce the extent of land under agriculture
while increasing the yield.
In the past, Sri Lanka was considered the best for research in
rubber, rice, tea and coconut but now we have lost that position and
therefore, local research capabilities should be developed but in the
meantime seed materials should be imported. The Agriculture Department
should engage in more Research and Development activities so that we
could regain our position as the best country for research in rice, tea,
coconut and rubber.
The high yield, quality and shelf life of the produce are facts to be
considered in purchasing seed materials so that the country can cater to
the future requirements.
When the country adopts these measures the agro economy will become
strong and make the country self-sufficient in food.
The other methods to reduce the import bill are popularising the
fruits grown in Sri Lanka and the consumption of fresh milk. At present
16% of imported food items consists of cereal related items and if the
country reduces this, it will directly reduce inflation.
Dr. Wickremasinghe said that as a responsible national bank having
the largest branch network and serving in areas which are not profitable
it is easy for the BoC to support the agro industry.
The bank provides loans to purchase seed material, agricultural
equipment such as tractors, processing equipment and to prepare land for
agriculture.
At present they are working with the Central Bank to reduce inflation
by reducing the prices of food items by increasing food production. We
are planning to achieve the target by promoting cultivation in home
gardens, schools and commercial scale farming.
The BoC supports all three ventures. The trend the world over is to
plant high yielding crops as this will help reduce prices.
Farmers find it difficult to repay loans in the event they face a
natural disaster and at most times the banks fail to support them during
such an event.
Therefore, when the BoC provides a loan to the farmer the insurance
policy of the Agriculture Insurance Board (AIB) is in-built to protect
the farmer from natural disasters or diseases from pests and covers up
to Rs. 100,000 life and crop. Dr. Wickremasinghe said that all
agricultural activities in the future will be done together with the AIB
as this will help farmers in times of disaster.
The bank gives loans for dairy farming too as it helps reduce
imports, saves foreign exchange and provides employment as well. He said
that the bank has launched a program to mobilise savings to increase the
savings ratio in the country.
When the bank started the program our savings ratio was 16% and it
has increased to 20% and we as a national bank are happy to increase the
savings ratio.
A developing country such as Sri Lanka needs 30-35% savings ratio but
we are far below that, he said. |
