Meanwhile President Mahinda Rajapaksa in his maiden budget also proposed to reestablish the once defunked Paddy Marketing Board and all storages to be brought under this institution.
Spending more taxpayer money on reestablishing the Paddy Marketing Board will also allow the government to offer farmers a guaranteed price of up to 17.50 per kg for paddy.
The higher guaranteed price will cost the economy an additional R. 2.2 billion, this without factoring the rice mill costs and middleman costs and calculated on the high end of the current guaranteed price or Rs. 16.50 and on the average 2 million tones of rice the island produces.
Other sweeteners included implementing a new incentive package consisting of credit, seed and fertilizer at affordable prices for paddy
The Government also proposed to amend banking regulations to make it mandatory that credit extended to agriculture be increased to 10% during the next three years.
Over the Hill
The plantation sector will get a Rs. 10 bn revolving fund for sector development and a 25% increase in re-planting subsidies.
The 2006 budget proposed a revolving fund for the development activities in the plantation sector with special emphasis on stallholder plantations.
The budget also proposed to increase the subsidy for new planting and replanting by 25% for tea, rubber and coconut cultivations.
Meanwhile the government will dedicate the Plantation Development Trust to concentrate on water supply, pre-shcools, child development and sports while expanding the Praja Shakthi Programme to focus on micro enterprises.
The government also proposes to set up a vocational training college in Nuwara Eliya and rehabilitate estate roads and develop 50,000 houses in the region.
Other incentives for the sector included introducing subsidies to encourage coconut cultivation in Mahaweli areas, Galle, Matara, Hambantota and in the traditional coconut growing districts.
The budget also proposed to develop excess land owned by the Plantation Ministry.
The fisheries sector will net a total Rs. 1.4 billion in 2006 to develop multi-day boats, inland fisheries and a fish processing industries.
The President and Finance Minister Mahinda Rajapaksa presenting his maiden budget speech proposed to establish a fishing promotion fund to promote deep sea fishing.
As part of the strategy the government will develop a multi-day boat manufacturing industry and provide easy payment scheme for fishermen to purchase boats and operation of motor vessel for offshore and deep sea fishing
Sri Lanka however lost an opportunity to develop its fishing industry after the tsunami, where donors clamored to restock the sector with near-shore fishing vessels.
Meanwhile, the government hopes to promote prawn farming in the Batticaloa districts while further improving prawn farming infrastructure in Puttalam district.
The government will also put money into developing a state-of-the-art- fish market complex in place of St.Johnís Market in Central Colombo.
The sector will also get a education with the proposed establishment of a of the Ocean University.
-Shafraz Farook: email@example.com