Indifferent officialdom and frustrating red tape hampering investments in Sri Lanka— Mrs. Deepani Samarasinghe

Top woman entrepreneur calls for new laws to facilitate approvals from local bodies



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Mrs. Deepani Samarasinghe(Pic by Sujatha Jayarathna)

With a largely callous officialdom and frustrating red tape hampering investments, the government should adopt new legislation to facilitate potential investors to secure the required approvals from local authorities within a reasonable time frame, says Mrs. Deepani Samarasinghe, one of Sri Lanka’s leading woman entrepreneurs.


Ministers can give assurances and invite investors, but the follow-up process is appalling. There is only helpless all around as officials merrily sit on the approvals and do what’s required at snail’s pace, she complained.


As the Chairperson of APS Knitters (Pvt) Ltd., Mrs. Samarasinghe is the winner of multiple national awards in the knitted fabric industry.


"The government gives every encouragement to private sector entrepreneurs to start new factories and commercial ventures. The state and private banks also are equally encouraging towards new investors, but under the current system of granting approvals is a nightmare when it comes to dealing with officialdom. Many entrepreneurs face extreme difficulties during this process and then it discourages investors from going ahead with their venture", she asserted in an interview.


As a key woman business leader in the knitted fabric industry, she ventured into an entirely different sphere by launching Platinum Auto Spa, a state-of-the-art premier destination for all automotive requirements at Boralesgamuwa.


Referring to the new project, Mrs. Samarasinghe said: "To purchase the initial plot of land, we had to obtain a credit facility for which interest has to be paid from the point the loan is obtained. The land registration office takes a minimum of two months to process the documents and transfer ownership. The initial construction plan can only be forwarded to the Municipal Council after the ownership transfer is dealt with.


"If the Municipal Council takes five months to respond to the initial construction plan, what kind of situation does that place the investor in? After that, there are a lot more approvals and certificates to be obtained until the construction operations begin. Interest expenses would keep accumulating during those many months for which the investor has to sit idly by and wait for replies from the Municipal Council. 


"During this time period, the entrepreneur would have made a considerable investment in importing the necessary infrastructure, equipment and machinery. Not being able to position the equipment to a plan would place the investor in difficult situation during this crucial time as losses will accumulate without any return on investment. 


"If this investor is an already established business person, he may be able to face the difficulty and financial losses somehow, but these losses and setbacks will have a devastating impact on a new investor starting out for the first time. It can lead to extreme discouragement for any new investor hoping to begin a venture of his own. 


"There has to be an establishment set up to deal with these situations when a new investor or industrialist faces such a situation. At least, the Ministry of Industry and Commerce should have a department to handle these situations and provide support and stability to investors or businessmen hoping to make this giant leap when launching a new venture for the development of the economy".


She suggested that the best method for the government to encourage entrepreneurs is to address this concern at the initial level and correct it from within the Municipal Council itself. So that the problem can be addressed before it places the investor in a situation where he is discouraged and subject to extreme difficulties. 


"It is my hope that the necessary steps will be adopted as soon as possible and this situation is corrected in future so as to not discourage any of our entrepreneurs from commencing new ventures", she said. 


"I started this project based on a business idea floated by my elder son Kaushal Samarasinghe. He is a keen motor racing enthusiast, who has wide experience and knowledge in the motoring field.


"Another key reason for the launch of this new business was that my son got the opportunity of marketing in Sri Lanka products of two companies in this field based in the USA and Malaysia. But, as a woman entrepreneur who embarked on this journey 20 years ago, many were the problems, obstacles and impediments I faced in launching this new auto project.


"As a woman business leader who has won multiple national awards under the large-scale business category, I have faced many difficulties. I am a well-known entrepreneur, but if this was the way I was pushed from pillar to post and made to kick my keels, imagine the plight of a lesser known investor? What is the use of the government’s so-called encouragement and incentives, if this is the sad situation where officialdom is concerned?"


There needs to be a suitable modeled environment that cultivates new businesses; new laws to be adopted to ensure approvals are handled within reasonable time frames. The officialdom needs to be more efficient when it comes to the granting of approvals and certificates so the investor is able to conduct the project smoothly without facing unnecessary difficulties at the onset, she said.


"I believe this would help new investors and encourage them to commence more entrepreneurial work". 


"I am in the business of manufacturing knitted fabrics. There is a big demand for locally produced knitted fabrics in Sri Lanka and I am happy with the prevailing market conditions for the products. We should ensure that the knitted fabrics we supply to our clients are of a high quality standard", she noted.


"If we are to compete internationally, we should have access to state-of-the-art technology. We should use new technology and modern machinery to meet global benchmark standards. It is new and modern technology that will help us to cut down on the cost of production, while ensuring the delivery of top quality standard products to the local market", Mrs. Samarasinghe emphasized.


Continuing she said" "In my business, I have continuously shown profound commitment towards these benchmark production quality standards. The production process of APS Knitters was awarded ISO 9001:2008 International Quality Standards Certification.


"Actually, I am content with the status quo of the knitted fabric industry in Sri Lanka, but at the time I ventured into this trade, conditions were difficult to do business. The reason for that was the imposition of taxes by the government on key raw materials used by the industry.


"It became a formidable task to continue in business because the tax on raw materials used by the local industry was the same as the duty imposed on the variety of knitted fabrics imported to the country.


"However, since 2010 taxes on all raw materials procured by the knitted fabric industry, particularly varieties of yarns and threads, were completely abolished. At the point of importing the different materials, there is an applicable duty.


"This was a wise decision to safeguard the local knitted fabric industry. Today, a major part of the local demand for knitted fabric is supplied by local producers. The industry does not import clothing materials for the manufacture of knitted fabric, but instead uses mostly local products to meet overseas orders. This is in a way an indirect form of exporting our own fabrics".


 


 
 
 
 
 
 
 
 
 
 
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