Modi assures Sri Lanka of immediate fertilizer supply
- The Indian PM has assured Sri Lanka of an immediate supply of fertilizer, the Sri Lankan President has said, as the island braces for a food crisis amid a crushing economic meltdown.
- India is yet to make any official statement in this regard.
Situation of Sri-Lanka:
- Dollar crunch for months.
- Struggling to pay for essential imports, including food, medicines, fuel, and LPG.
- High food inflation.
- Harvest from the previous season has drastically fallen, due to the previous government’s controversial policy shift to organic farming last year.
Why fertilizer import is so vital now:
- essential to domestic production as the sowing season begins for the Yala season, one of two important agricultural production cycles of monsoon in Sri Lanka.
- Sri Lanka is now counting the swift arrival of a 65,000 tonne fertilizer consignment from India worth about $25 million.
What led to this worse situation:
- In May 2021, Sri-Lankan govt. banned chemical fertilizers, calling for an abrupt switch to green agriculture that farmers were not prepared for.
- To curb import bills, this ban severely affected production of paddy, pulses, maize, spices, and tea that are crucial for both domestic consumption, and export earnings.
- Seeing their harvest fall by 50 %, many farmers have decided not to sow this season.
- Despite a policy reversal by the then President, after massive farmer protests and criticism from scientists, fertilizers are still in short supply, or not affordable without subsidy, especially in record inflation.
Help offered by India:
- Extended crucial assistance, of about $3.5 billion, by way of credit lines for imports, loan deferments, and currency swaps.
- Fertilizer industry in India