Cabinet of Ministers approved a minimum guaranteed price of Rs. 50 per 1kg of paddy

The Cabinet of Ministers has approved a minimum guaranteed price of Rs. 50 per 1kg of paddy, with a recommended moisture level, from the harvest of Maha season.

This was announced during the meeting held this morning (23) to announce the Cabinet decisions.

The government expects a harvest of 3 million metric tons of paddy from the harvest reaped during the Maha season 2019/2020. As a principle, the government does not import paddy, hence, the prices of paddy has hiked moderately. The government says that this move has helped save an approximate amount of USD 100 million of foreign exchange. Owing to this, the exchange rate has stabilized while the interest rate has gone down, the government said.

Accordingly, the Cabinet of Ministers decided that the government shall mediate in purchasing surplus of paddy stocks in the Maha season of 2019 / 2020 with objective of encouraging the private sector paddy millers to purchase paddy under a fair price to ensure sustaining a fixed price of paddy.

The Cabinet has also decided to implement the following decisions without delay:

  • Imposing a minimum certified price of Rs. 50/- for a kilo of paddy with the due standard (subject to the criterion of moisture.)
  • Minimum certified price of a kilo of paddy with moisture to be certified as Rs. 45/-
  • Implement the government programme to purchase rice through district secretaries / government agents as well as the Paddy Marketing Board (PMB)
  • Direct purchase of quantities of rice required for government institutions such as Tri forces, Department of Prisons, Hospitals etc; from Paddy Marketing Board (PMB) itself.
  • Immediately entrusting all the store houses / warehouses under the purview of the Food Commission for storing the paddy stocks purchased for storing paddy stocks that is purchased.
  • Utilizing lorries and trucks belong to the government for transportation of paddy stocks
  • Issuance of pledge loans through state and private banking establishments approximately amounting to Rs. 100 billion under a concessionary loan interest rate of 8% for those purchasers including small and medium scale as well as large scale millers for the purchase of paddy under the certified price.
  • Entrusting the monitoring of the paddy purchasing programme in the pioneering districts of Polonnaruwa, Anuradhapura, Kurunegala, Vavuniya, Ampara, Batticaloa, Monaragala and Hambantota to several state ministers
  • Immediate issuance of circulars required to implement the above programme by the Secretary to the President.