He added that despite money printing and other mechanisms, the government has failed to control inflation in the country.The MP speaking in Parliament yesterday said Rs.13 billion was printed on the same day that the new Central Bank Governor Ajith Nivard Cabraal took office adding Rs.23 billion was again printed recently.
He said that even though the government resorted to printing money as a solution to the economic crisis, inflation increases due to the lack of supply to the increased demand and as a result inflation has increased to 6.8 percent. “Today, the government has failed to control this situation. Even though import restrictions have been imposed, this will not resolve the crisis.”
MP Herath said the government has four options, printing money, obtaining more loans, selling national assets and restricting imports. “No matter what they have done, the government has failed to control this crisis. The government took a policy decision regarding the ban on fertiliser imports with the aim of reducing import expenditure. The President said that it would be more profitable for the government to stop fertiliser imports and issue free carbonic fertiliser to the farmers and compensate them for their reduction in harvest.”
However, Herath noted that while their stand is also that chemical fertiliser usage should be stopped and farmers need to switch to carbonic fertiliser, this should have been done systematically in stages. But, he added that the government had taken a sudden decision to stop chemical fertiliser imports but to date the government has failed to implement a mechanism to produce the requirement of carbonic fertiliser locally.