Nov 10, 2016 (LBO) – Sri Lanka will set up a special price stabilization fund for sugar cane, and give state land and a 100 percent capital allowance to set up factories as incentives to develop the industry, Finance Minister said.
“I propose to establish a Sugar Stabilization Fund by imposing a 2 percent Cess on imported sugar and 5 percent on ethanol imports, to protect the sugarcane farmers, from the adverse impact that may arise from the fluctuations in price and loss of crop,” Ravi Karunanayake, minister of finance said while delivering the 2017 budget speech in Parliament.
He said local and foreign investors will be invited to invest in sugar mills in Monaragala, Batticaloa, Kilinochchi and Ampara districts with a minimum plant size of 2,000 Tonnes crushed per day (tcd).
“We will provide government land to cultivate sugarcane under the out grower system with the respective factories… also provide a 100 percent capital allowance on the investment.”
The government will also encourage Sugar Crystals to be imported for value addition, he added.
Sri Lanka spends around 250-400 million US dollars per annum on the importation of sugar.