Government to Inject Rs. 2.5 Billion More for Paddy Purchases

COLOMBO (News1st): The Government is set to seek Cabinet approval for an additional Rs. 2.5 billion to purchase paddy harvested during the ongoing Yala season.

Minister of Trade, Commerce, Food Security and Cooperative Development Wasantha Samarasinghe made the remarks during an event in Kahatagasdigiliya, Anuradhapura, outlining the Government's efforts to address challenges faced by paddy farmers and ensure stable market access for their harvest.

Samarasinghe said the Government had made a significant intervention to resolve issues surrounding paddy procurement. He noted that President Anura Kumara Dissanayake had held discussions with large-scale mill owners, small-scale mill owners and officials of the Paddy Marketing Board in an effort to develop a comprehensive solution.

According to the Minister, all stakeholders were informed of the importance of purchasing the country's paddy harvest and protecting the livelihoods of farmers. However, he stressed that the Government did not stop at discussions alone and moved forward with a practical funding mechanism to ensure paddy purchases could take place.

As part of that effort, financial allocations were made to the Paddy Marketing Board to facilitate the purchase of farmers' stocks. The Minister revealed that during 2026, the Government had allocated Rs. 10 billion for paddy purchases during the Maha season, while Rs. 6 billion has already been released for the current Yala season.

He added that a Cabinet paper to be submitted today seeks approval for a further Rs. 2.5 billion.

Samarasinghe also highlighted measures introduced to support small and medium-scale rice mill owners, many of whom had expressed willingness to purchase paddy but lacked the necessary capital.

The Government has therefore introduced interest-free loan facilities for small and medium-scale mill owners capable of milling up to 25,000 kilograms of paddy per day, enabling them to purchase paddy directly from farmers.

He said that nearly 60 rice mills in Anuradhapura have already received such interest-free financing, allowing them to procure paddy from farmers at the guaranteed price of Rs. 120 per kilogram over an eight-month repayment period.