Subsidies of Rs 1.1 Billion on Gas Appliances, Flour and Rice

The biggest piece of this package, a sum of Rs 717 million has been used to subsidize the price of cooking gas cylinder. For this year, the STC provides an additional increase in the budget given the price volatility staples on the world market.

"The price of LPG will continue to increase to the extent that the production is struggling to meet demand. Regarding the price of rice and flour, they will also take the elevator due to the effects of climate change on culture, coupled with bad speculation, "said at the State Trading Corporation .

STC makes a profit of Rs 791 million

For the second consecutive year, the State Trading Corporation (STC) has achieved positive financial results, earning a profit of Rs 791 million for the 2012 financial year, Rs 32 million more than the previous year.

The parastatal has registered a record turnover of Rs 37.5 billion, against Rs 36.3 billion in 2011. Despite its withdrawal in the cement business operations since mid-2011. The balance sheet shows a strong cash flow (200%), thus reducing the need to borrow heavily.

According Megh Pillay, the Director General of the STC, this performance is due to more fiscal discipline, good governance and diligence during the acquisition process. It also welcomes the capacity of the STC have been able to operate throughout the year, availability of imported products in the local market. " Additionally, major quality improvements were achieved in all of them, particularly in rice and petroleum products at no additional costs to the consumers", boasts the Director General of the parastatal bodies, which recall, was financially in the red for a few years this.

According to the financial report, some Rs 33.8 billion from the importation and distribution of petroleum products. With the volatility of world oil prices, says docuement the Prize Stabilization Account (PSA) showed deficits of Rs 211 on 31 December 2012. Indeed, the price of diesel and gasoline remained above the reference price for most of the year. But with the fuel price adjustments in March this year, the PSA has been gradually engulf deficits.

Another detail to remember for subsidies on the prices of basic necessities. In 2012, the financial envelope covering the price of cooking gas, flour and rice ration stood at over Rs 1.1 billion. The biggest chunk of the budget, a sum of Rs 717 million was used to subsidize the price of cooking gas cylinder. Despite an increase in the selling price of the cylinder 12 kg which increased from Rs 300 to Rs 330. The volume of imported LPG was 67 900 tonnes.

Conversely, the budget subsidies on the selling price of rice and flour ration declined to Rs 153 million compared to the 2011 bill. This partly due to the strategy of buying the STC. Rs 734 million has been collected under the burden in the structure of prices of diesel and gasoline. The money was handed over to the Road Development Authority. A sum of Rs 398 million was also paid in the MID Fund.