The government intends to establish a dedicated bank to assist farmers who rely on high-interest loans to finance their cultivation, Deputy Minister of Housing, Construction and Water Supply T.B. Sarath said.
Speaking to reporters, Sarath said the proposed bank would provide farmers with a production allowance of Rs. 100,000 per acre to help cover cultivation costs. He said many farmers currently turn to high-interest lenders and then struggle to repay, which often forces them to sell their harvests at unfavourable prices.
The Deputy Minister also said the government was in discussions with China to set up an “Agricultural Equipment Hub” in every farming area. The initiative aims to give farmers affordable access to modern machinery, including tractors, harvesters, drones and other equipment needed for cultivation.
Sarath said farmer organisations would be established over the next two to three cultivation seasons to channel financial support to growers. “We have been in power for one and a half years and have a five-year mandate to address the challenges faced by farmers,” he said.
The announcement did not include a timeline for setting up the bank, details of its capitalisation, or the source of funding for the per-acre allowance. Successive governments have rolled out concessionary loan schemes and input subsidies for the agriculture sector, which employs a significant share of Sri Lanka’s rural workforce but remains exposed to high borrowing costs, weather shocks and volatile crop prices.
