By Charles Haviland BBC News, Colombo

	Army says it will continue selling vegetables until prices stabilise

On Friday it started buying up vegetables from producers and selling them on to consumers at fixed prices lower than current shop prices.

The military has been moving into new areas of life here. It recently opened a tourist resort in the north. Now it has become a vegetable vendor.

The military spokesman told the BBC that the army is buying up vegetables from farmers.

It is bringing them to the Colombo area to sell them at concessionary rates, about one-third less than the shop price.

'No transport costs'

He said the army would bear most of the transport costs and it was a better deal for both producers and hard-pressed consumers.

Sri Lanka has recently imported eggs and chickens on a huge scale as a measure to reduce increasing cost of living

It is one of several unusual recent measures taken to tackle food price rises and shortages.

Eggs and chickens have been imported on a huge scale. Coconuts were also to be brought in, but the idea has been suspended because of quarantine regulations linked to palm diseases.

Economists say the price hikes are worsened because of Sri Lanka’s protectionist food policies, meaning there are usually high tariffs on food imports.

And some question whether the army’s vegetable sales can work.

One business analyst said that prices should be allowed to fluctuate so that farmers can invest their profits in increased production.

The impact on ordinary greengrocers and vegetable sellers is also unpredictable. But the army says it will continue selling vegetables until prices stabilise.