Cabinet decides to introduce rice subsidy scheme
Published on: Friday, September 22, 1978
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“The need to produce adequate supply of rice has always been one of the major problems of Sabah. In the past, the State had depended quite heavily on import of rice to supplement the increasing demands of consumers. It was in an attempt to solve the problem of the shortage of rice that the Sabah Padi Board was established in 1967.”
However, even until now, Sabah still imported more than 40 percent of the rice requirement of the State, Datuk Ongkili added. The costs of imported rice have in general increased over the last few years. Moreover, the supply of rice in the international market was of ten erratic causing sudden fluctuations in prices.
Datuk Ongkili explained that it was in order to reduce this dependence on imported rice that the State Government undertook an extensive study on other possible ways and means of regulating the price and production of rice in Sabah.
The Government has come to the conclusion that unless more rice was grown in Sabah the State would continue to be at the mercy of the erratic supply and fluctuating as well as inflationary prices of imported rice.
“The State Cabinet therefore decided to implement a Credit Subsidy Scheme to encourage padi farmers in Sabah to grow and produce more rice locally. This Subsidy Scheme will be implemented on a State-wide basis, particularly in traditionally rice growing districts such as Papar, Penampang, Tuaran, Kota Belud and Keningau where rice farmers can benefit directly from the subsidy.
“When fully implemented the new Rice Subsidy Scheme will cost the State Government about $5 million annually. However, the Subsidy Scheme will bring forth an additional output of more than 18,000 metric tons of rice.
At the average current price of medium grade imported rice, this will mean a saving in foreign exchange of about $16 million for Sabah annually,” Datuk Ongkili said.
The Rice Subsidy Scheme is to be implemented with effect from Jan. 1, 1979.
The Rice Credit Subsidy Scheme Division will be created in the Sabah Padi Board to undertake the responsibility of implementing the new Subsidy Scheme, Datuk Ongkili said.
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