Monday, May 23, 2011

Food prices

People from overseas are often shocked at the price of food in Sri Lanka, visitors from as far away as England and Australia have been muttering darkly after a visit to the local supermarket. We usually reply that this due to inflation but think no more of it.

A friend of mine recently told me that the reasons for high prices are due to taxes and poor policy. Imported food is taxed (a lot of our food is imported) and this results in high prices in the local market. He gave me the example of coconut.

The Government has imposed heavy import duties on vegetable oils (soy, corn etc) thus driving up the prices of imported cooking oil. Local coconut producers thus find it more profitable to channel coconuts to oil production leading to a shortage of fresh nuts in the market resulting in coconut prices shooting up to Rs.60/- Will anybody with a coconut oil mill confirm this? The supermarket prices for coconut oil were between Rs.470-505 per litre (N'Joy and Cooks Joy) while vegetable oil ranged from Rs.425 upwards.

In the meantime, coconut producers seem to be doing fairly well, but not as spectacularly well as the nut prices suggest. One smallholder manages to still make a loss, but his holding (5 acres) is probably uneconomic and suffers from a high level of theft. Someone with a much larger holding (about 90 acres) says he is doing reasonably well, but I am not close enough to him to dig up detailed figures. again, anyone who can supply further information is welcome to do so.

Fish prices are supposed to be high due to tax imposed on canned Mackeral. The tax is supposed to be around Rs.100/- per can, a 450g can retails for Rs.215. People try to buy fresh fish instead and this pushes the fresh fish prices up. The customs website has some details of taxes, but is not detailed enough. Taxes on potatoes, onions and sugar have been revised a number of times.

The Gutterflower very kindly assisted me by compiling the prices of a few common foodstuffs in Delhi.

Indian Prices (converted to LKR @ 2.45 LKR = 1 INR)

Normal Rice 80.86
Long grain basmati 161.73
Yellow lentils 68.61
Red lentils 134.77
Potato 28.79
Tomatoes 54.64
Onion 30.63
Chicken (whole chicken, approx) 367.57
Bread 31.10 (780g sliced bread INR 22, converted to a 450g price to make comparison easier)

Local Prices

Red Raw rice 56
White Raw 58
Basmati 286
Mysore Dhal (small reddish grains) 168
Mysore Dhal (larger yellowish grains) 139
Potato 120
Tomatoes 70.7
Bombay onions 74
Small onions 173
Chicken] 350
Bread 102.75

In terms of basic cheap rice, currently local prices are lower, although there was a time a few months back when they shot up to around Rs.100/- a kilo. In almost every other item the Indian prices are far lower than in Sri Lanka. Why this should be so is the question to which I have yet to find an answer.

What is especially interesting are the prices of onions and bread. Locally produced red onions are more than double the price of imported Bombay onions. The price of bread, thrice the Indian level is inexplicable, unless wheat is heavily subsidised in India. India does indeed subsidise wheat, the extent of which on a per kg basis I need to try and work out.

Surprisingly enough chicken prices are comparable although production in Sri Lanka should be more inefficient. Chickens are fattened on grain, it takes roughly 3.5kg of feed to produce a kilo of chicken, since this country does not produce enough grain, the bulk of the feed ingredients are imported. Therefore a producer of grain such as India should have an inherent advantage that should translate to lower prices. Many years ago when someone checked on the possibility of imported frozen chicken from India, selling prices in India were around 60% of the local cost of production.

These are just a few thoughts and I would appreciate any feedback that could explain some of these questions.

Update 13-6-2011

LBO has an interesting article on the revenue raised by food taxes, see here.

Wednesday, May 18, 2011


Driving up the hills from Ratnapura.

Further along the drive

Adisham, in the afternoon light

Dawn breaks on the forest

The road up to Lipton's Seat

The view of the valley, partway along the route to Lipton's Seat.

Adisham, in the afternoon light.

The headstone on W.S. Senior's grave

Haputale has some stunning scenery, about the best there is in the country, equalled only by the scenery in the Knuckles mountain range. Fortunately it to too far off the main tourist trail to become as despoiled as Nuwara Eliya. It has deteriorated in the twelve years since I first visited, especially on the road up to Adisham where part of the forest has been felled and two ugly hotels and a number of small guest houses have mushroomed.

The ruthlessness with which any opportunity for a quick profit will be exploited by Sri Lankan's needs to be seen to be believed. Endemic corruption ensures that the few building, environmental and safety regulations can be ignored and one finds spindly, ugly buildings clinging to hillsides offering board and lodging or refreshments. Why this entrepreneurial spirit cannot be channelled more productively is a mystery. Some of the hills were being logged heavily, with backhoes and other equipment leaving great bare patches on the hills. It is no wonder that with the heavy rains there are frequent landslides in the hill country.

Despite the best efforts of the rent-seekers, there is much beauty to behold and it is easy to see what captivated Sir Thomas Villiers, who built Adisham at a particularly stunning spot and Walter Stanley Senior.

Senior's love of the place was such that although he retired to England his ashes were interred at the churchyard of St Andrews, Haputale. The inscription on the headstone, taken from his own poem Lanka from Pidurutalagala reads:

Here I stand in spirit,
as in body once I stood Long years ago,
in love with all the land,
This peerless land of beauty’s plenitude

Followed by the words:

He Loved Ceylon

A fitting tribute to the craggy, smoky mountains and deep valleys. The rolling mist, which descends suddenly, together with the sparkling sunshine is a photographers (or painters) delight, possibly even worthy of Turner.

There is little do do in Haputale except breathe the crisp clean air and enjoy the magnificent scenery. An ideal place for solitude, which is probably why the Benedictine Monks turned Adisham into a monastery.

Large groups of noisy tourists please go away.

Saturday, May 14, 2011

Servants, a perspective from the Raj

I am in the midst of reading Charles Allen's Plain Tales from the Raj, an author I discovered at this years literary festival.

It is about the experiences of the Anglo-Indians - used in the original sense of the term: the British who lived in India. An Anglo-Indian himself, born into a family six generations in India, he worked on a BBC programme in 1973 to record the memories of the last surviving Anglo-Indians. The book grew out of the series of recordings made and broadcast in 1974.

I found the attitude towards servants rather interesting, particularly:

The question of how to address servants varied with status. 'It was a point of honour with us in the established civil service never to talk to the servants in anything but their own language,' states John Cotton, the result was that he who spoke the language had a much better type of servant. In much the same way Iris Portal was taught that 'you must never have an English-speaking servant. My father's attitude was that if you, an educated woman can't speak the language of a man who's illiterate you really aren't fit to employ him.'............

And a few lines later

Wives who knew the customs and languages of India 'would never think of asking a servant to do a thing that was beneath him or was in any way contrary to his religion'. The pukka memsahib was never 'tactless enough to bring back Bacon from the Club and hand it to a bearer who was a very strict Mohommedan. One put it upon a table and a sweeper would come and take it away, because he was a Hindu and did'nt mind touching bacon.'
I think this is interesting because it reveals a relatively progressive, or at least pragmatic attitude towards the ruled. I suppose it is not possible to rule for any length of time riding roughshod over the sensibilities of the people.

Sunday, May 08, 2011

Reconciliation: A lesson from Nigeria?

I recently finished reading The State of Africa by Martin Meredith. Subtitled 'A History of fifty years of Independence' it is just that - a broad survey of the continent and a book for anyone who believes that useful lessons can be learned from the failure of others.

Well written albeit in simple straightforward prose, the litany of the continents woes is sometimes a little overwhelming; names, places, dates tend to swim into one another, so it is best to read a chapter or two at a time. There are one or two bright patches such as the process of reconciliation in Nigeria following the Biafran war.

Meredith notes that:

The aftermath of the war was notable for its compassion and mercy; and the way in which the memories of Biafra [the secessionist state in south-eastern Nigeria] faded. Quoting Lincoln, Gowon [Head of the Federal Military Government of Nigeria] talked of binding up the nations wounds. No medals for services in the war were awarded, no reparations were demanded; Biafran rebels were reabsorbed in the Federal Army; civil servants [who served the secessionists] returned to their posts in the federal government; and property belonging to Igbos [the people from the rebel areas in the South East] in the North and other Federal areas was restored to them. In this war, said Gowon, there had been 'no victors and no vanquished'.

Friday, May 06, 2011

Bin Laden and human rights

The United Nations High Commissioner for Human Rights Navi Pillay has called for a full disclosure of the facts surrounding the killing of Bin Laden to determine legality of the operation. This call has been echoed by both Amnesty International and Human Rights Watch.

This underlines an important principle: human rights are fundamental and even people like Bin Laden should expect due process.

No doubt Bin Laden was a thoroughly nasty character who has claimed responsibility for the death of thousands, I have no sympathy for either his cause or his methods, but basic principles of justice need to be respected. Ideally, the team should have attempted to capture Bin Laden alive and then put him on trial. If he was killed accidentally in a shootout, then it is acceptable but the assassination, which is another term for extra-judicial killing should not be condoned. This is why the UNHCR needs to investigate the circumstances of his death.

It is easy to say that terrorists, or for that matter, criminals have no rights. The question is who determines if someone is innocent or guilty? If the authorities start prejudging guilt, what starts to happen is that suspects, rather than criminals start getting punished and a suspect could be anybody: anyone could make a false complaint that so-and-so was responsible for such-and-such a crime.

In order to ensure justice is available to everybody, certain principles need to be observed at all times. William Blackstone's formulation "better that ten guilty persons escape than that one innocent suffer" is what law should be based on. It is, as Soli Sorabjee, former Attorney-General of India remarked during a debate on this subject, what marks a civilised nation.

Thursday, May 05, 2011

The killing of Bin Laden- implications for Sri Lanka

There are serious issues that are raised by the circumstances of Bin Laden's death and they concern Pakistan, a country regarded as a friend by the Sri Lankan regime. The relevant facts are:

1. He was killed in Abbottabad, pretty little town in North East Pakistan that is also home to the Pakistan Military Academy.

2. He was living in a large semi-fortified compound that to some observers resembled an ISI safehouse. Neighbours claimed that the current occupants moved in some five years ago.

3. Bin Laden suffered from kidney failure and required regular dialysis. There was no dialysis equipment in the house he occupied so he had to receive regular treatment from outside. Although the city boasts of 21 hospitals (it was a centre for treating casualties from the Kashmiri earthquake) the fact that he was not noticed raises the possibility that he received treatment at the military hospital located in the town.

The awkward questions raised by these facts are:

1. Bin Laden was being sheltered by the Pakistani military or some rogue elements within the military. Given the long period during which he has held there whoever did so had have at least a few fairly senior people involved.
2. The political leadership (and the military) claims they were unaware of Bin Laden's whereabouts. If the political leadership was indeed unaware then the question needs to be raised as to whether the political leadership has control over the military. If the military leadership were also unaware this raises the possibility of rogue elements within the military at a fairly senior level.

Pakistan was supposedly a strong US ally helping them in the Afghan campaign, it now looks that they were either helping the enemy all along or that the state has no effective control over its military, either possibility being equally disturbing.

Pakistan's economy is in shambles and large amounts of US aid help things along. The US is under internal pressure to cut aid and if this happens then the state may be weakened further.

India has long accused Pakistan of assisting guerrillas and insurgents in Kashmir and elesewhere. They were also accused of complicity in the Bombay train bombings and in the later Bombay hotel attacks. The suspicious circumstances of Bin Laden's hideout will only strengthen the view that Pakistan is a sponsor of terror in India. The two countries have already fought three wars, the last in 1971.

To make matters more complicated, both countries now have nuclear weapons and the fallout from such a conflict will affect all its neighbours. Sri Lanka's relations with India are frigid, India is already suspicious of the cosy relationship with China, taking a line seen as pro-Pakistan now would be the worst thing we could do. Attempting to pay a 'Pakistan' card to try and gain leverage over India, on say the Darusman Report, would be disastrous.

Countries where the Great Game was played out generally ended up hosting proxy battles between the protagonists. This was the fate of Afghanistan, having toyed with India and China Sri Lanka should tread carefully to avoid a similar fate.

Update: NDTV just reported at 18.05 local time that there was firing at an Indian border post and that Indian forces have retaliated.