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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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Construction of Accident and Emergency unit at Mannar District General Hospital begins under President’s patronage

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Construction work on the Accident and Emergency Unit at the Mannar District General Hospital commenced this morning (16) under the patronage of President Anura Kumara Dissanayake.

The Accident and Emergency Unit, which is being constructed at a cost of Rs. 600 million with a grant from the Government of India, will be equipped with all modern facilities and will further expand healthcare services for the people of Mannar. Construction is scheduled to be completed in the first quarter of 2028.

Upon completion of the project, the people of Mannar will be able to receive emergency trauma care and other specialised healthcare services without having to travel to Colombo or other major cities. At the same time, the Government has taken steps to provide the Mannar District General Hospital with the medical equipment and staff required to support these services.

President Anura Kumara Dissanayake, who attended the commencement of construction work on the Accident and Emergency Unit, also engaged in a cordial conversation with members of the hospital staff.

Addressing the ceremony held thereafter, Minister of Health and Mass Media Dr. Nalinda Jayatissa said that as the Mannar area, which is expected to make an important contribution to the national economy, develops, this project will help ensure quality healthcare services for its people. The Minister further emphasised that, in creating a “A Thriving Nation – A Beautiful Life”, the Government is committed to ensuring healthy and disease-free lives for all 21.7 million citizens of the country.

Further remarks by Minister of Health and Mass Media Dr. Nalinda Jayatissa

“The Mannar District is an area that is expected to make an important contribution to our national economy. A large number of local and foreign tourists will visit this area both now and in the future.

With the development of transport facilities, Mannar will experience further economic growth. In such a context, upgrading the services of the Mannar hospital will be important in ensuring quality healthcare services for the people of this area as well as those who visit the region.

Accordingly, construction of this Accident and Emergency Unit will be completed and the facility will be made available to the public in the first quarter of 2028. In addition, staff quarters for doctors at the Mannar District General Hospital are being constructed in a four-storey building at a cost of Rs. 243 million. These construction activities are also expected to be completed within one and a half years. Construction of the new Paediatric Unit, being built at a cost of Rs. 230 million, is also expected to commence within this year.

Similarly, the CT scanner that you have been continuously requesting will be provided to you by around February next year. It is worth approximately Rs. 250 million. While these building facilities are being developed, we will also provide the staff required by the hospital. You have also received intern medical officers for the first time in the history of this hospital. Several more intern medical officers will be assigned to you this October. At the same time, steps are currently being taken to address the shortage of specialist medical officers.

On 31 October, we will recruit 2,600 new nurses, and a portion of them will be assigned to this hospital. Personnel required for the allied health professions are also currently undergoing training. Once their training is completed, the services of several of them will be made available to this hospital. In addition, we will recruit 1,100 Public Health Midwives, a portion of whom will also be assigned to this area.

This Government is taking numerous measures to provide people with healthy lives. Through these initiatives, we hope to improve the health and quality of life of the people in this area.

More than Rs. 600 billion has been allocated to the Ministry of Health over the past two years, and the President continuously monitors all its projects. Going beyond that, I am deeply grateful to the President for joining us  today.

We have received the support of the Government of India for this project. I extend my special appreciation to the Government of India, including the Prime Minister, and its people, as well as to the High Commissioner of India and his staff, who have been committed to coordinating these activities and ensuring the success of this project.

Among district hospitals, the Mannar hospital is one with very limited facilities. Despite these shortcomings, I appreciate the dedication of all members of the staff, including the doctors, who remain committed to providing the best possible service to the people. I also consider the President’s visit to be a recognition of your service.

Two years ago, on 21 September 2024, the people of this country gave a clear mandate to create a “A Thriving Nation – A Beautiful Life”. That mandate was further strengthened in November 2024. Under the mandate to create a “A Thriving Nation – A Beautiful Life”, we have been entrusted with the responsibility of ensuring healthy and disease-free lives for all citizens of this country.

Your area of residence, profession, wealth or ethnicity is of no relevance to us in this regard. The Government’s objective is to create a beautiful life through healthy and disease-free living for all 21.7 million citizens of Sri Lanka.”

High Commissioner of India Santosh Jha:

“The agreements for the emergency unit in Mannar and the medical ward complex in Mullaitivu were signed under President Dissanayake’s leadership. I am happy to see these commitments transitioning smoothly into swift implementation.

His Excellency the Prime Minister of India, Shri Narendra Modi, has said that the development assistance extended by India to Sri Lanka comes with a deep sense of responsibility, a duty that one naturally feels for one’s family member.

We remain firmly committed to working closely with the Government of Sri Lanka and the people of Sri Lanka for the well-being and prosperity of all communities across the island. As neighboring countries and close partners, we will continue to walk together this shared path toward lasting progress and development of our peoples.”

Secretary to the Ministry of Health and Mass Media Dr. Anil Jasinghe

“For several decades, injuries and accidents have been the leading cause of hospital admissions in Sri Lanka. As Mannar is geographically somewhat isolated, it is extremely important for the district to have access to quality, free healthcare services without delay.

The assignment of intern medical officers to this hospital commenced this year. Arrangements are also currently underway to purchase a CT scanner for the Mannar District General Hospital. The hospital is expected to receive improved radiology facilities by the end of this year or the beginning of next year.

I must say that, during my 36 years in public service, last year was the only period during which I did not face any financial difficulties in carrying out my duties. The prudent macroeconomic management of the current Government, including President Anura Kumara Dissanayake, has created the fiscal space required to develop the country’s health services.”

Mannar District Bishop Rt. Rev. Gnanapragasam Anthonipillai, Northern Province Governor Nagalingam Vethanayahan, Members of Parliament representing the Mannar District, Secretary to the Ministry of Defence, Air Vice Marshal Sampath Thuyacontha (Retd), Chiefs of the Defence Services, officials of the Ministry of Health, officials of the High Commission of India in Sri Lanka, Consul General of India in Jaffna Sai Murali S. and officials of the Indian Consulate in Jaffna, among others, attended the occasion.

[President’s Media Division]

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Special Cabinet Subcommittee and Officials’ Committee appointed to address El Niño Climate Impact meet

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The Special Cabinet Subcommittee and Officials’ Committee appointed to take necessary measures to address the impact of the El Niño climate phenomenon met for the fifth time at the Presidential Secretariat on Monday (14) afternoon , under the chairmanship of Minister of Environment Dr Dhammika Patabendi.

As the El Niño climate impact is expected to transition from the current dry conditions to wetter weather over the next two months, the committees held an extensive discussion on measures to address the anticipated change in weather conditions.

The committees decided to raise public awareness on potential disasters, including floods and landslides that could occur due to increased rainfall. Attention was also given to conducting disaster preparedness drills to familiarise the public with the appropriate measures to be taken in the event of such emergencies.

It was instructed that initial preparedness drills be conducted in the districts of Kandy, Badulla, Matale and Nuwara Eliya, which are considered vulnerable to landslides and that the necessary measures be taken without delay.

The meeting also decided to implement a public awareness programme through electronic and print media. Discussions were also held on the importance of preparing the public in advance by establishing operational centres at Divisional Secretariat level.

In addition, the committees reviewed the progress of relief measures already being implemented for people affected by the prevailing El Niño conditions, as well as the progress of the planned measures ahead.

Minister of Housing, Construction and Water Supply Dr Susil Ranasinghe, Minister of Plantation and Community Infrastructure Samantha Vidyaratne, Secretary/Convener of the Special Cabinet Subcommittee, Chairman of the Officials’ Committee and Chief of Staff to the President Prabath Chandrakeerthi, Secretary to the Ministry of Agriculture, Livestock, Land and Irrigation D. P. Wickramasinghe, Director General of the Department of Meteorology A. L. K. Wijemanne, Director General of the Disaster Management Centre, Major General Sampath Kotuwegoda (retired), Director General of the National Building Research Organisation Dr Gamini Jayatissa, General Manager of the National Water Supply and Drainage Board Engineer T. Bharatheedasan and officials from the relevant institutions were also present at the meeting.

[President’s Media Division]

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Where is Gnanasara Thera?Police pass buck to court

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Gnanasara Thera

by Norman Palihawadane

Bodu Bala Sena (BBS) General Secretary Ven. Galagoda Aththe Gnanasara Thera’s whereabouts have remained unknown since the Supreme Court, on Monday, annulled a presidential pardon granted to him in 2019.

Prison officers visited the Thera’s temple in Nawala, Rajagiriya, to take steps to return him to prison to serve the unexpired portion of his six-year sentence. However, monks at the temple had reportedly informed the officials that they were unaware of his whereabouts.

Police spokesman ASP F.U. Wootler said a separate court order was required for the police to trace the Thera, or assist in taking him into prison custody. No such order had been issued so far, he claimed.

Meanwhile, sources close to Gnanasara Thera said he was expected to attend a book launch in Colombo tomorrow (17),

The development follows the Supreme Court declaring the 2019 presidential pardon granted to Gnanasara Thera, by then President Maithripala Sirisena, null and void.

A three-member Supreme Court bench held that the pardon had been granted arbitrarily and violated public trust and principles of natural justice.

Gnanasara Thera had been serving a six-year prison sentence for contempt of court when the then President Sirisena granted him the pardon, in May, 2019. He had served only about nine months of the sentence at the time.

With the pardon annulled, the original sentence remains in force and the Thera is now required to serve the balance of his six-year term.

The Supreme Court ruling has raised questions over the procedure to be followed to return him to prison, with police and prison authorities yet to take custody of him.

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