By Ajit Randeniya –

Ajit Randeniya

There are several key characteristics that help distinguish the new interim administration from the previous Mahinda Rajapaksa government. The leading among these are the non-declared suspension of the country’s Constitution and the obvious symbolic, and material, repositioning of Sri Lanka as a willing and submissive recipient of the so-called Western-values template being pushed by the international community of neocons.

The evidence of the suspension of Constitution came through early with the appointment of the prime minister by President Sirisena on 9 January, and more evidence came through the sacking of the chief justice under pressure from the lawyers’ union.

The symbolic declaration of allegiances to the so-called Western values is apparent by the change in the dress code of the UNP de facto Cabinet – over night – to ‘dark suits’ from the national dress, with the prime minister and foreign minister seeming to be the most enthusiastic adopters of the new ‘civilised’ garb. Even arch western boot-lickers like JR Jayewardene would be turning in their graves!

The de facto foreign minister’s travel schedule that seems to be fast reaching legendary proportions also shows that he has a lot of pent-up energies of worship to be offered at Brussels, London, New York and Washington.

Not too many critics of the allegedly crooked previous administration have raised ire or even adequately discussed the unconstitutionality – and therefore the illegality – of such clearly “extra vires” actions under the promised regime of Yahapalanaya of the motley crew currently co-habiting the centres of power.

There have also been a number of areas such as nepotism and cronyism, both by the president and the de facto prime minister and cabinet that would be contrary to any understanding of Yahapalanaya. As an example, the de facto Prime Minister Ranil Wickremesinghe, and the de facto State Ministers Rajiva Wijesinha, Ruwan Wijewardene and Vasantha Senanayake are first cousins, not to mention other minor relationships among a number of members of the de facto Cabinet. Only a few would notice such connections due to camouflaging under different surnames. The president has also appointed his brother and the son-in-law to key government posts.

But this item is about the most shocking form of family cronyism achieved through presidential decree: the removal of the direct paddy purchasing powers of the Paddy Marketing Board (PMB), announced on Thursday, February 12. The description of the fraud as an exercise in stamping out corruption makes it even more hideous.

The de facto minister of food security announced at a media briefing that “From now on we will not allocate money to the PMB to buy paddy since President Maithripala Sirisena has decided that the PMB has become corrupt”. He also announced that the objective of the move was to break the monopoly affecting the rice sector of Sri Lanka.

The de facto minister is clearly trying to pull the wool over the eyes of the electorate! Even a second grader will be able to understand that abolishing the paddy purchasing power of the PMB would only strengthen the hand of those who control the market at present even more!

The PMB was established under Parliamentary Act No. 14 of 1971 to be the leading national institution with the specific charter “to purchase and handle Agro-based products, with the mission of implementing a trading mechanism that served the interests of the agro-producer as well as the consumer”. The PMB largely lived up to such expectations until the mid-1990s when a coterie of private buyers with political patronage undermined its operations for self-interest.

The situation got decidedly worse for the PMB under the successive SLFP governments since Chandrika Kumaratunga, with President Sirisena’s brother Dudley Sirisena of Araliya Rice, with another deputy minister of the Rajapaksa government, Nipuna Gamlath finally became a duopoly controlling paddy price to the detriment of farmers in Anuradhapura and Polonnaruwa.

These two mill owners achieved teir dubious “success” by somehow managing to obtain finances easily from the state banking sector during harvest times while starving the smaller millers who faced many obstacles in securing loans from the same banks.

Former Polonnaruwa District JVP MP S.K. Subasinghe complained: “Right at the beginning of harvesting, leading mill owners obtain loans from state banks without any hassle. Then, they buy and hoard stocks. When small scale mill owners get loans after going through difficult formalities, there isn’t much paddy left to be procured from farmers. Leading mill owners also manipulate the prices by the use of devious methods,” he said.

Over 90% of the mills have been closed due to lack of bank financing under such a regime of corruption, and only around 60% of the closed mills buried under debt to banks could probably be revived under the best of circumstances.

At the time the PMB was given the death blow last week, the private sector rice millers and traders headed by these two figures are estimated to be carrying paddy and rice stocks amounting to around 1,200,000 MTs, four times the tonnage held by the PMB and the District Secretaries, at around 300,000 MT.

At present the price of paddy has come down to half of the recommended price with Samba bought between Rs.16 to Rs.18 and ‘Nadu’ at Rs.14 a kilo. But rice consumers rarely gain a look at such low prices. Farmers say they are unable to pay loans they had taken to grow paddy under such a price regime but monopolists carry out their fleecing of farmers unabated. They are now bound to face worse difficulties because the PMB was the only buyer of paddy at a guaranteed price.

The brother of President Sirisena has been having a few bites of the national finance cherry: In May 2012, UNP MP Ravi Karunanayake told parliament that the Committee on Public Enterprises (COPE) had found that the two politically influential mill owners in the Polonnaruwa district had defaulted on the repayment of loans amounting to Rs.300 million borrowed from the Bank of Ceylon to purchase paddy from farmers in the area. The Bank had eventually written off this amount as bad debt.

There are other reasons of revenge that may have prompted the presidential decree on barring the PMB from purchasing paddy with immediate effect: In July 2013, PMB, with the assistance of Police, raided the premises of 11 rice mill owners in the North Western and North Central provinces who had failed to mill and market paddy stocks that were purchased from PMB. The mill owner were fined to the tune of Rs. 6.8 million with a single mill owner in Ampara fined Rs. 1 million while three rice mill owners in the Polonnaruwa region were arrested and fined Rs.2 million.

In the meantime, speaking to the latest edition of Business Today (Feb 2015) the presidential sibling Dudley complained that Araliya rice is struggling to maintain a steady supply with the rapidly increasing demand. May be not anymore with the legalised paddy purchasing monopoly!

Yahapalanaya or not, it helps to have relatives at high places it seems.