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SAEA warns of big economic losses due to import restrictions on chemical fertilizers and pesticides

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In the absence of proper substitutes

The Sri Lanka Agricultural Economics Association (SAEA) has expressed some concerns on the appropriateness of the newly introduced regulation to restrict forthwith the import of chemical fertilizers and pesticides by the Gazette Extraordinary No 2226/48 of May 6, 2021, to achieve the broader development goal.

In a letter to President Gotabaya Rajapaksa, the SAEA, the professional body representing the Agricultural Economists of Sri Lanka, has predicted massive economic losses due to potential yield losses in the absence of proper substitutes for chemical fertilizers and pesticides with the implementation on the import ban on fertilizers and pesticides.

“The immediate adverse impacts on food security, farm incomes, foreign exchange earnings and rural poverty can be detrimental to achieving the cherished long-term goals”, it warned.

“Our membership endorses the government’s decision to adopt a Green Socio-Economic Model for development as we firmly believe that such a strategy would be critical to conserving the environment and improving human health. We agree that green approaches in crop cultivation contribute significantly towards achieving Sustainable Development Goals (SDGs)”, the professional organization noted in its letter to the President.

Moreover, SAEA is of the view that most of the current farming systems in Sri Lanka are unsustainable. Hence, the conversion of them into organic farming systems in the long run, would help promote health of the people and nurture integrity of the nation’s environment. It is well known that many countries currently take systematic and pragmatic approaches to achieve this long-term objective by first setting targets, standards, and subsequently, investing and promoting farmers to adopt best practices, it further said.

“Therefore, we would like to extend our appreciation to the government for taking such a valuable decision to adopt the green socio-economic model in Sri Lanka”.

Outlining its primary concerns and the less costly policy alternatives proposed by its members in place of the newly introduced import ban for the President’s consideration, the SAEA was of the view that the policy instrument identified by the government to promote organic farming is less appropriate due to potential economic losses and its incompatibility with other policy goals of the government.

Continuing, the professional body of Agricultural Economists, further opined: “When converting from conventional agriculture into organic farming, the government should weigh the technological, environmental and economic costs and benefits. The preliminary findings of the studies conducted by the SAEA on potential economic losses of the import ban and respective estimations are as follows:

 

(a) Agronomic studies reveal that the average yields from paddy can drop by 25% if chemical fertilizers are fully replaced by organic fertilizers. This loss in productivity could reduce the profitability of paddy farming by 33% and rice consumption by 27% if paddy is cultivated just with organic fertilizers with a complete ban on rice imports. In contrast, applying organic fertilizer with the recommended dosages of chemical fertilizers would improve the profitability of farming by 16%.

 

(b) Absence of chemical fertilizer would drastically reduce the productivity of the Vegetatively Propagated Tea (VPT). With a 35% productivity drop, the export volume of tea would go down from 279 to 181 million kg, causing an income loss of LKR 84 billion. The estate sector will likely incur significant losses compared to those of tea smallholders. These losses could further be aggravated due to increased cost of labour to apply bulky organic fertilizers.

 

(c) The coconut yields would go down by 30% if chemical fertilizers and pesticides are not applied. This situation will adversely impact fresh coconuts availability for the production of coconut oil, desiccated coconut and other coconut products. The loss in foreign exchange earnings can be as high as Rs. 18 billion, based on the assumption that only 26% of the total coconut extent is fertilized. When the additional cost for the importation of edible oils is considered, the loss of foreign exchange earnings will be even higher.

 

(d) The above results were derived considering the immediate effects on three agricultural sub-sectors. An analysis performed accommodating adjustments in the economy over the medium to long run reveals that a reduction in average agricultural productivity by 20% could cause a decrease in Gross Domestic Product (GDP) by 3.05% suggesting an overall contraction of the economy with the implementation of the import ban.

The proposed policy instrument is not compatible with the policy objectives stated in ‘Vistas for Prosperity and Splendor’. Given below are a few policy incompatibilities highlighted by the members of SAEA (Relevant statement from Vistas for Prosperity and Splendor shown in parenthesis).

 

(a) Modernization of agriculture

 

(International export business through various value-added products backed up by new technologies): The SAEA would like to propose that the government considers Sustainable Intensification of farming systems to feed the growing population with rising incomes, seeking safe and nutritious food, which are produced in environmentally sustainable farming systems, rather than converting all systems to fully organic agriculture, as its policy objective.

 

(b) Food self-sufficiency drive (Make the country self-sufficient in the relevant products): Estimates reported in section A (a) indicate that a food deficit would be created in the country owing to yield losses. However, the current government policy on food self-sufficiency would not allow the policymakers to fill this deficit through imports. Such a situation could give rise to food price inflation, unrest, and starvation.

 

(c) Freedom (People-Centric Economic Development): The chosen policy instrument does not provide flexibility to farmers to determine their least-cost food production methods without harming the environment. This situation would violate the ‘people’s freedom’ policy of the government.

 

(d) Rural-urban migration (Linking the village development together with the regional development): Contraction of the rural economy due to reduced farm profitability will lead to increased migration from rural to urban areas. With limited capacity of the manufacturing sector to absorb migrants, this will result in urban congestion.

 

(e) Commitments with the WTO and other international relations (Friendly, Non-aligned, Foreign Policy): The policy instrument chosen is not compatible with commitments to the WTO.

Alternative policy instruments for making food systems more environmentally sustainable

In light of the above observations, members of SAEA suggest the government use more cost-effective instruments to achieve the stated health and environmental outcomes in place of the newly introduced import regulation.

Globally, the approach to environmental protection has been evolving from a regulation-driven approach to a more proactive approach involving voluntary and market-led initiatives. Accordingly, we wish to propose the following three-point policy package.

 

1. Incentivize organic cultivation using safe and environmentally friendly organic fertilizers and pesticides: Open up pathways towards encouraging organic fertilizer production, storage, distribution, etc. and promote Public-Private Partnership (PPP) models to achieve those.

 

2. Develop national standards for organic fertilizers and pesticides to ensure non-importation of substandard products to the country and domestic production meeting specified quality standards.

 

3. Improve awareness of various organic farming technologies among farmers through a strengthened extension system.

 

Institutionalize and make Good Agricultural Practices (GAP) a mandatory national standard.

 

Dis-incentivize use of chemical fertilizers and pesticides in an environmentally harmful manner: Revisit national standards for chemical fertilizers and pesticides to ensure non-importation of sub-standard products to the country.

 

Impose environmental taxes on selected inorganic fertilizers and pesticides.

 

Reduce and eventually eliminate the subsidy on chemical fertilizers. In phasing out the fertilizer subsidy, we wish to recommend the following steps:

 

* Prioritize subsidies according to characteristics such as fertilizer type, agro-ecological region, season and crop.

* For the targeted farmers, establish a voucher system that restricts farmers’ access to a lifeline amount [such as two bags] and require them to purchase the balance at market prices for a limited period.

 

* When the subsidy is lowered, introduce an output price support program to support the farm producers partially.

* Provide and support farmers to adopt site-specific fertilizer recommendations and integrated pesticide recommendations.

* Reduce and eventually eliminate protection provided to crops that are highly fertilizer intensive and erosive.

* Strengthen existing measures to improve awareness of the safe use of chemical fertilizers and pesticides.

 

Cross-cutting proposals to safeguard the poor and vulnerable and improve the policy process: Maintain a safety net for the poor recognizing the possible increase in food prices.

 

* Identify a harmonized financing mechanism. For example, finances of saved fertilizer subsidy and environmental taxes can be used to subsidize organic fertilizer production and application.

* In formulating the strategic roadmap, adopt a consultative process involving all stakeholders (policymakers, politicians, agriculturalists, environmentalists, and the private sector) and also considering economy-wide impacts (macro, meso and micro) and externalities.

Considering the economic loss, policy inconsistency, and counter-productive effects created by the regulation in the manner introduced and the availability of relatively superior alternative measures, the SAEA seeks to substitute the import ban on chemical fertilizers and pesticides with the set of alternative measures proposed above. The SAEA extends its professional support to establish a green-economic model for the agriculture sector of Sri Lanka.

The letter signed by Dr. Sampath Dharmadasa, President/SAEA and Dr. Shashika Rathnayaka, Secretary, has been copied to the Prime Minister, Ministers of Agriculture and Plantations, among others.



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Sri Lanka Customs exceeds revenue targets to enters 2026 with a surplus of Rs. 300 billion – Director General

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The year 2025 has been recorded as the highest revenue-earning year in the history of Sri Lanka Customs, stated Director General of Sri Lanka Customs, Mr. S.P. Arukgoda, noting that the Department had surpassed its expected revenue target of Rs. 2,115 billion, enabling it to enter 2026 with an additional surplus of approximately Rs. 300 billion.

The Director General made these remarks at a discussion held on Tuesday  (30)  morning at the Sri Lanka Customs Auditorium, chaired by President Anura Kumara Dissanayake.

The President visited the Sri Lanka Customs Department this to review the performance achieved in 2025 and to scrutinize the new plans proposed for 2026. During the visit, the President engaged in extensive discussions with the Director General, Directors and senior officials of the Department.

Commending the vital role played by Sri Lanka Customs in generating much-needed state revenue and contributing to economic and social stability, the President expressed his appreciation to the entire Customs employees for their commitment and service.

Emphasizing that Sri Lanka Customs is one of the country’s key revenue-generating institutions, the President highlighted the importance of maintaining operations in an efficient, transparent and accountable manner. The President also called upon all officers to work collectively, with renewed plans and strategies, to lead the country towards economic success in 2026.

The President further stressed that the economic collapse in 2022 was largely due to the government’s inability at the time to generate sufficient rupee revenue and secure adequate foreign exchange. He pointed out that the government has successfully restored economic stability by achieving revenue targets, a capability that has also been vital in addressing recent disaster situations.

A comprehensive discussion was also held on the overall performance and progress of Sri Lanka Customs in 2025, as well as the new strategic plans for 2026, with several new ideas and proposals being presented.

Sri Lanka Customs currently operates under four main pillars, revenue collection, trade facilitation, social protection and institutional development. The President inquired into the progress achieved under each of these areas.

It was revealed that the Internal Affairs Unit, established to prevent corruption and promote an ethical institutional culture, is functioning effectively.

The President also sought updates on measures taken to address long-standing allegations related to congestion, delays and corruption in Customs operations, as well as on plans to modernize cargo inspection systems.

The discussion further covered Sri Lanka Customs’ digitalization programme planned for 2026, along with issues related to recruitment, promotions, training and salaries and allowances of the staff.

Highlighting the strategic importance of airports in preventing attempts to create instability within the country, the President underscored the necessity for Sri Lanka Customs to operate with a comprehensive awareness of its duty to uphold the stability of the State, while also being ready to face upcoming challenges.

The discussion was attended by Minister of Labour and Deputy Minister of Finance and Planning, Dr. Anil Jayanta Fernando, Deputy Minister of Economic Development, Nishantha Jayaweera, Secretary to the President, Dr. Nandika Sanath Kumanayake, Deputy Secretary to the Treasury, A.N.Hapugala, Director General of Sri Lanka Customs,  S.P.Arukgoda, members of the Board of Directors and senior officials of the Department.

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Educators slam govt. for ‘unprepared’ education reforms

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Teachers, principals and education professionals have said the government is unprepared to roll out proposed education reforms scheduled to take effect from next week, and warned of nationwide trade union action if the plans are implemented without adequate consultation and preparation.

Addressing a press conference in Colombo, President of the Association of Education Professionals, Ven. Ulapane Sumangala Thera, said Ministry officials had indicated that the reforms would be implemented from Monday, 05 January, but claimed that the vast majority of educators were opposed to the move.

“More than 90 percent of teachers say they have not received proper training on the new syllabus or the proposed reforms,” Ven. Sumangala Thera said. He alleged that the government was attempting to suppress opposition from teachers and principals by declaring school holidays, instead of addressing their concerns.

“If the government continues with these tactics, we will have no option but to resort to trade union action at a national level,” he warned.

Meanwhile, representatives of 16 teachers’ and principals’ unions who visited the Ministry of Education at Isurupaya on Monday to seek clarification on the reforms were turned away by security officials, reportedly on the grounds that prior appointments were required.

Speaking to the media outside the Ministry, Amila Sandaruwan of the Teacher Principals’ Collective said the delegation had attempted to raise their concerns during the Public Day allocated for visitors. “We wanted to know how these reforms are to be implemented and sought to meet the Secretary to the Ministry of Education, but we were barred,” he said.

Sandaruwan accused the Government of proceeding in an “adamant” manner and claimed the reforms were being driven by a handful of non-governmental organisations closely associated with senior ministry officials. “We will not allow this to happen,” he said.

Graded Principals’ Association representative Nimal Mudunkotuwa said widespread confusion prevailed among teachers and school administrators regarding the practical aspects of implementing the reforms. “There is no clarity on school hours—whether schools are to close at 1.30 p.m. as before, or continue until 2.00 p.m. as proposed,” he said.

He added that uncertainty also remained over the number of daily teaching periods, with conflicting statements suggesting either seven or eight periods. “Schools have yet to receive syllabus modules from the Ministry, and many schools lack smart boards and internet connectivity required to implement these reforms,” Mudunkotuwa said.

Ven. Ulapane Sumangala Thera strongly criticised the proposed reforms, describing them as “bastard reforms,” and accused the NPP Government of undermining the education system. He also raised objections to a unit in the proposed Grade Six English syllabus dealing with gay and lesbian relationships, claiming that senior Buddhist prelates, the Catholic Cardinal and other religious leaders had opposed its inclusion.

“The Government refuses to listen even to religious leaders,” he said.

Concerns were also raised at a National Sangha Council meeting held in Colombo on Monday evening at the Colombo Foundation Institute, organised to discuss the objectives of the proposed reforms. Addressing the gathering, Professor Venerable Induragare Dhammaratana Thera said the reforms required extensive discussion, consultation with subject experts and consideration of the experience of senior administrators.

He warned that the proposed changes could trigger the biggest crisis currently facing the country. “Implementing these reforms in this manner will harm future generations and could even destroy the present Government,” he said, likening the process to “forcing a round peg into a square hole.”

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Leading the Nation’s Connectivity Recovery Amid Unprecedented Challenges

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SLT Mobitel teams at work after Cyclone Ditwah

SLT-MOBITEL’s post-Cyclone Ditwah response reinforces its role as the National ICT Solutions Provider

In the aftermath of Cyclone Ditwah, SLT-MOBITEL led one of the most extraordinary national connectivity restoration efforts in recent years, mobilising the full breadth of its operational network, technical expertise, and emergency response systems to safeguard Sri Lanka’s digital lifeline.

The cyclone caused extensive flooding, landslides, and infrastructure damage throughout several districts, disrupting multiple layers of the national network. Yet within days, SLT-MOBITEL mounted one of the fastest and most comprehensive recovery operations in the company’s history, reaffirming the organisation’s role as the country’s telecommunications backbone.

From the earliest hours of the disaster, SLT-MOBITEL activated a coordinated national response, drawing on its regional operational structure, specialised engineering teams, and emergency governance mechanisms. The Sri Lanka Backbone Network (SLBN), the country’s most critical digital artery, signalled excellent resilience, with only a handful of nodes affected and restored within 24 hours. As the National ICT Solutions Provider, SLT-MOBITEL prioritised restoring connectivity for other network operators and users, while simultaneously extending comprehensive support to its own customers, ensuring that mobile services were swiftly re-established across the country.

The rapid restoration of SLT-MOBITEL’s islandwide core network served as a critical catalyst in accelerating the recovery of both fixed and mobile services across nearly all disaster-affected areas. This swift action also enabled other operators affiliated with SLT-MOBITEL to speedily restore their services, reinforcing the continuity of nationwide connectivity. To drive this effort, SLT-MOBITEL established a centralised ‘War Room’, operating under close management oversight, to coordinate telecommunication network restoration and rehabilitation across the country. Initial assessments indicate recovery and network upgrade costs of approximately LKR 5 to 6 billion.

SLT-MOBITEL teams worked around the clock to repair damaged fibre routes, recover flooded cabinets, and restore thousands of access nodes affected by the cyclone. In areas where fibre infrastructure was severely damaged, the company deployed temporary Fixed Wireless Access (FWA) facilities, helping communities, emergency responders, and essential services stay connected. Priority restoration was extended to hospitals, government agencies, and enterprise customers, helping with the continuity of critical national operations during the emergency.

SLT-MOBITEL also launched the 247 National Medical Helpline, a dedicated, round-the-clock support service introduced in collaboration with the University of Colombo. Within the first week of the launch, the medical helpline received a large volume of calls as the initiative provided immediate initial medical guidance to individuals facing injuries, infections, waterborne diseases, and other health complications. The service was powered by SLT-MOBITEL’s national connectivity backbone and a team of medical professionals arranged by the University of Colombo. The helpline became a vital public service, demonstrating the company’s commitment to supporting Sri Lankans in crisis and recovery through resilient infrastructure and accessible, people-centred communication. More importantly, the service was made available to all network providers, guaranteeing no one was excluded from receiving medical assistance islandwide.

SLT-MOBITEL worked closely with the Ministry of Defence, serving as the connectivity solutions provider for national disaster response efforts. With the support of the Sri Lanka Army, field teams were able to swiftly access affected sites, enabling faster repairs, safer operations, and the restoration of services in some of the most challenging terrains. The partnership highlighted the critical role of telecommunications in national security, emergency coordination, and public safety, with the Army’s contributions acknowledged with gratitude.

In addition to network restoration, SLT-MOBITEL extended critical national-level support to various government institutes, sustaining essential public services during the disaster period. As a result of the services provided, SLT-MOBITEL secured uninterrupted operations and dependable connectivity for these vital national institutes.

Within one week of the cyclone, SLT-MOBITEL had successfully restored over 98 percent of the sites impacted by the cyclone, with only a small number of locations in the most severely affected districts, pending access clearance. The company continues to address individual customer connections and any remaining access nodes, despite significant human resource and environmental challenges. Throughout the recovery period, customers demonstrated commendable patience and understanding, which greatly supported the restoration efforts.

The disaster has also highlighted the urgent need for long-term national network resilience. SLT-MOBITEL is advocating for the accelerated undergrounding of high-risk fibre routes, prioritised access to bridge ducts, and fast-tracked power restoration protocols during emergencies. The company is also advancing the migration of copper-based access networks to fibre.

As Sri Lanka’s National ICT Solutions Provider, SLT-MOBITEL is committed to keeping the nation connected in every crisis. The rapid restoration efforts, cross-government support, and dedication to public service reiterates the company’s mission to rise above commercial operations, upholding the role as the country’s trusted digital lifeline.

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