🌾 Sri Lanka Paddy & Agrarian Policy: Call to Separate Social Welfare from Commercial Production

• Macro Context: World Bank estimates 24.5% of Sri Lanka's population lived below $3.65/day poverty line in 2024 (up from 2019 levels), alongside food prices doubling between 2021–2024. • Production Statistics: • 2025/26 Maha Season: 769,700 ha cultivated, 691,690 ha harvested; yield reached 3.134M MT (avg 4,531 kg/ha). • 2025 Yala Season: 485,002 ha harvested; yield reached 2.308M MT (avg 4,760 kg/ha). Yields varied from 5,175 kg/ha (major irrigation) to 3,471 kg/ha (rainfed). • Value-Chain & Price Structure: • PMB Purchasing Prices: Rs. 120/kg (Nadu), Rs. 130/kg (Samba), Rs. 140/kg (Keeri Samba). • Retail Price Caps: Rs. 220/kg (Raw), Rs. 230/kg (Nadu), Rs. 240/kg (Samba), Rs. 260/kg (Keeri Samba). • Milling Efficiency: Practical outturn is ~62.5% (1.6 kg paddy per 1 kg rice), making paddy cost alone ~Rs. 192 per kg of Nadu rice before milling, transport, and processing expenses. • Subsidies & Insurance: • 2026 Yala fertiliser cash subsidy set at Rs. 30,000/ha (capped at 2 ha / Rs. 60,000 per farmer). • Free crop insurance covers up to Rs. 40,000/acre (~Rs. 100,000/ha up to 5 acres). Special commercial seed-paddy schemes offer enhanced Rs. 180,000/acre cover for a Rs. 13,600/acre premium. • Policy Outlook: Policy must decouple poverty alleviation from paddy and agri-sector development to protect high-yield commercial producers while offering targeted social safety nets for vulnerable households.