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Importers plead for help as lockdowns jam supply
Importers beset by delays in shipments and unloading are pleading for banks to grant special loan terms as the curfew is making it difficult to keep business flowing.
A common problem is the shortage of labour: 50-60 per cent of labourers are not reporting to work due to the ongoing crisis.
The President of the Essential Food Commodities Importers and Traders Association, Gnanam Rajendran, urged the government this week to consider requesting banks to expand borrowing terms for importers.
“The practice is that 50 percent of the payment is paid when the order is paid and the balance is settled once the payment is received, but in the current context importers have found it difficult to go on with the drill,” he said.
He believes that if banks collectively consider lowering interest rates on a case-by-case basis, especially to importers supplying essential goods, a huge burden could be lifted.
Mr. Rajendran refuted claims of shortages, saying, “There are sufficient stocks. There are even some goods in excess stock, such as onions, that vendors have been unable to sell.”
Mr. Rajendran also raised concerns about overcrowding of retailers in Pettah and the lack of sanitising facilities.
“The authorities must take steps to fumigate or provide some kind of hygiene facilities in Pettah. It would be much appreciated because we hardly know who we are dealing with and where they are from, and this can increase the risk of spread if an individual has contracted the disease,” he explained.
A trader attached to the Woodland Trading Company raised concerns about late shipments.
“There was an order placed for commodities from India around mid-March and the cargo arrived in Sri Lanka only last week,” he said.
He also pointed out that because courier services have not been functioning over the past two weeks, importers were finding it difficult to obtain the normal documentation necessary to clear cargo.
“Stocks are moving really fast these days due to very high demand, and stocks at hand are very limited although there are stocks expected to arrive in coming weeks,” the trader said.
Almost 60 per cent of food commodities are imported from India and, with the March 24 lockdown of the neighbouring country, some importers are worried about the stability of future imports from there.
Cargo being cleared now at the ports had been ordered prior to India’s lockdown, some of it having been held up at the port due to delays in processing paperwork, leading importer KTC Group said.
“As of now there is no scarcity and the stocks in hand and the stocks about to be received are sufficient, but if all countries go into lockdown for a longer period then there would a problem with importing goods,” KTC Group Chairman M.S.M. Zaneer said.
The government has permanently halted imports on commodities that can be locally produced, such as pepper, cashews and incense sticks.
Cabinet spokesman Minister Bandula Gunawardena said Sri Lanka imports $US22 billion a year and this cost could not be sustained.
“The global pandemic that has led to an international crisis has affected many economies, including ours, and this resulted in the drastic depreciation of the rupee’s value against the US dollar during past weeks,” he said.
Mr. Gunawardena disclosed that to help control the rupee’s value the government was encouraging the flow of foreign currency into the country through relaxed laws on money coming into Sri Lanka.