World Bank to provide $ 70 m to uplift Sri Lanka’s plantations sector

The World Bank will provide Sri Lanka $ 70 million to modernise the estates and factories of Regional Plantations Companies (RPCs), the Ministry of Plantation Industries said in a statement.

The funds will mainly be utilised for replanting, improving roads and tea factories, and water management to deal with climate change impact.

The World Bank support has been given following the talks held recently between the Minister of Plantation Industries, Navin Dissanayake and World Bank officials to explore possibility of obtaining assistance to upgrade and develop tea plantations managed by RPCs to enhance their profitability.

According to the Ministry statement, World Bank officials agreed to allocate $ 70 million for the project and it was proposed that 50% of the amount would be released as a concessionary loan and the balance as an outright grant.

“This facility is for the replanting of tea which has been badly neglected over the years and to upgrade the dilapidated roads network in tea estates,” the statement said.

Part of the fund will be used to cluster a suitable number of scattered tea factories into a centrally located large scale automated tea processing plant that will improve the quality of tea produced at a lower cost. It was proposed to mitigate the negative impact of climate change and erratic rainfall patterns by introducing novel water management techniques such as sprinkler irrigation to drought stricken tea fields enabling year-round harvesting of tea leaves.

The Ministry statement also said a suggestion was made to market, tea, directly to consumers by the tea factory owners or producing estates, bypassing tea auctions to help increase the profit margins of producers.

“This project is expected to enhance the competitiveness of most of the tea estates and benefit many of the estate workers and employees,” the Ministry of Plantation Industries said.