Sri Lanka’s Consumer Affairs Authority (CAA) has rejected a proposal by milk powder importers to raise the price by LKR15 ($0.11) for a 450g packet of milk powder.

The current domestic price of a 450g packet of milk powder in Sri Lanka is LKR265 ($2).

According to a CCA official, a letter was sent to the country’s milk powder importers intimating them to maintain the price level that prevailed on 2 May 2011, reported The Sunday Times.

The agency’s decision came nearly after 30 days of receiving the proposal from importers, saying that the request cannot be considered since there has not been a global price rise.

Meanwhile, the milk powder importers have warned that they would consider stopping of new orders for milk powder stocks, if the government does not approve the proposal.

The price of imported milk powder was LKR428 ($3.29) in May 2011, which touched LKR569 ($4.38) currently, due to the devaluation of the Sri Lankan rupee against the US dollar.

Milk powder importers of Sri Lanka are currently losing LKR58 ($0.44) on the sale of a kilogram in the market, which used be LKR37 ($0.28) earlier.

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CAA is the apex government organization, mandated to protect consumers’ interests and ensure fair market competition in the island country.