Wednesday, July 6, 2022

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Govt. spends more dollars for rice imports despite adequate stocks

The Government has spent millions of dollars for the importation of over 140,000 metric tonnes of rice from countries including Myanmar at the end of last year at a time when the country had sufficient stocks to meet the demand.

A stock of 147,091 metric tonnes has been imported during the period of November- December 2021 using US$ 73 million out of the country’s dwindling foreign reserves, official statistics showed.

The total paddy production from both the Maha and Yala seasons was equivalent to 3.3 million metric tonnes of rice which was estimated to be sufficient to meet the domestic demand at that time, the 2021 annual report of the Central Bank revealed.

Accordingly, total paddy production recorded a bumper harvest for the second consecutive year in 2021.

This rice production has been achieved as farmers continued their cultivation using chemical fertiliser and agrochemicals including pesticides already imported to the country before the import ban, a senior official of the Agrarian Development Department said. . .

This buffer stock of rice was sufficient to feed the people in this country for at least 15 months, he said, adding that there was no need to import rice during the November –December 2021 period.

However the Cabinet of Ministers had given approval to a proposal made by the then Trade Minister Bandula Gunawardena to import 300,000 metric tonnes from India and Myanmar.

Under this approval the Trade Ministry had planned to import 100,000 metric tonnes of rice from Myanmar but approval was rescinded, Trade Ministry sources said.

Therefore the Ministry has imported 20,000 metric tonnes of rice from Myanmar at a cost of $450 per metric tonne whereas other countries bought the same variety for $350 per tonne.

The over-payment was $100 per metric tonne, an inquiry conducted by the Committee on Public Finance (COPF) detected.

It has been observed that the total overpayment in this rice deal was $2 million and the stock of 20,000 of rice had been imported without even checking the quality.

The balance stock of 127,091 metric tonnes of rice had been imported from India at cost of $62 million, COPF observed.

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