Rs.2.3 billion fertiliser subsidy approved by Cabinet

Friday, 31 December 2010 03:04 - - {{hitsCtrl.values.hits}}

More proposals to encourage organic fertiliser to reduce Rs.30 billion subsidy and MoU with Israel to boost scientific and technical knowledge

Battered by cost of living issues the government has focused on providing incentives to agriculture by approving the fertiliser subsidy, promoting compost manure and signing a Memorandum of Understanding (MoU) with Israel for knowledge transfer.

The fertiliser subsidy that was proposed by the Coconut Cultivation Board (CCB) last week was presented for Cabinet approval by the President as Minister of Finance and Planning on Wednesday.

Rs.2.3 billion fertiliser...

The annual cost was estimated at Rs.2.3 billion, down from Rs.4.5 billion originally estimated. All coconut growers are eligible for the subsidy that would provide a 50kg bag of Urea and Potash fertiliser at a price of Rs.1000. The market price is around three times that amount.

“The average annual coconut production this year is around 2750 million nuts and the government wants to increase this to 3 billion next year. This direct subsidy scheme will be implemented through 160 coconut development officers, 9600 agriculture research and production assistants and 25, 000 Samurdhi officers under the coordination of National Fertiliser Secretariat,” Media Minister Keheliya Rambukwella told media.

The Cabinet has also approved a proposal by Agrarian Services and Wildlife Minister S.M. Chandrasiri to expand the fertiliser subsidy and to promote the usage of organic fertiliser among farmers. Accordingly, as a pilot project 25 organic fertiliser production units will be set up in all 25 districts.

“At present a 50kg bag of fertiliser is issued at Rs.350 for paddy cultivation and this amount is nearly 10% of the market price and the government spends Rs.30 billion for this subsidy,” the minister noted adding that with the promotion of organic fertiliser the government expects to reduce the use of chemical fertiliser by 15% in the first stage with the ultimate goal of reducing the use of chemical fertiliser up to 25%.

The third prong of the agriculture development drive is to sign a MoU between the Sri Lanka and Israel for exchange of technical and scientific knowledge between the two countries. This will be inked between Israel and Minister Mahinda Yapa Abeywardene.