Sri Lankan government seeks to drive modernisation in agricultural sector

 

Policymakers in Sri Lanka are looking towards the development of a modern, sustainable agriculture sector to enhance economic growth, increase rural income and boost employment.

Small farming plots, low productivity and falling international commodity prices have resulted in many farmers being unable to invest in technology or seek out improved techniques. The majority of Sri Lanka’s food crops are grown by smallholder farmers who cultivate vegetables, rice, fruits, maize and groundnuts. The average smallholding is less than 1 ha in area, making mechanisation and achieving economies of scale problematic, while farmers’ negotiable titles makes investing in expensive equipment generally unrealisable. Productivity is also low, with the sector’s contribution to GDP below that of other countries at a similar level of development. According to figures from Sri Lanka’s central bank, agriculture accounted for 9% of GDP in 2015, compared to 37.8% in Myanmar, as reported by the UN Food and Agriculture Organisation (FAO).

The sector is also at risk from the effects of climate change, with the country experiencing flooding, droughts and changing rainfall patterns. The Asian Development Bank (ADB) has forecast that temperatures in Sri Lanka could rise by 3°C by the year 2100, drastically increasing rice and tea crops’ vulnerability to drought.

In addition to damaging crops, changing weather patterns also have longer-term effects, such as soil erosion. The authorities are looking to address these challenges and others faced by stakeholders in agriculture in order to ensure food security and continued growth in the sector.

Food Production Programme

Officials must thus address a variety of challenges to the agriculture sector in order to modernise, including a labour and skills gap, lower yields, higher production costs, the effects of climate change, a pivot away from the over use of fertilisers, rural poverty and a lack of technological adoption. In a bid to address these challenges, in October 2015 President Maithripala Sirisena introduced the comprehensive Food Production National Programme 2016-18 (FPNP), which depends heavily on the introduction of modern farming methods to enhance food crop production and agricultural development.

Staple Crops

Specifically, the FPNP identified crops including rice, maize, groundnuts, potatoes, vegetables and fruits as staples, and laid out a Crop Production Plan to enhance productivity and ensure self-sufficiency in these crops. Through the plan the authorities will work to ensure the availability of high-quality seeds, promote the use of organic fertiliser, strengthen supply and value chain management, build agro-industries, minimise post-harvest losses and promote crop exports.

The programme also aims to boost the country’s livestock and fisheries sectors. With an eye on increasing animal protein consumption by 40% nationwide, the authorities aim to provide assistance and incentives to chicken and meat producers, as well as subsidised animals to small-scale farmers. The programme’s livestock initiative was budgeted LKR100m ($682,000) in 2016, increasing by LKR50m ($341,000) for each of the subsequent two years.

Sri Lanka produced 73,900 tonnes of inland fish in 2016, which represented a 9% increase over 2015. The government hopes to boost the total to 110,000 tonnes in 2018, by increasing fish and prawn populations in lagoons, encouraging entrepreneurship in the subsector and developing export markets.

In addition to increasing sector output, the FPNP aims to address challenges posed by climate change. The authorities earmarked LKR82m ($569,000) for 2016, LKR90m ($614,000) for 2017 and LKR101m ($689,000) for 2018 to address this issue. Included in the programme are initiatives to disseminate water conservation and safeguarding measures, establish sustainable land management methodologies, recycle agricultural waste, introduce crop varieties adaptable to climate change and introduce environmentally friendly animal husbandry methods.

The programme established a public-private partnership (PPP) budgeted with LKR3m ($20,500) in 2016, and LKR4m ($27,300) in both 2017 and 2018 to assist in the execution of the programme. The PPP will manage sector marketing, oversee the dissemination of modern technologies and mechanisation, facilitate discussion and cooperation among stakeholders, and conduct research into best practices.

Organic Matter

Concurrently, authorities are working to move the country towards “low-external-input sustainable agriculture”, according to Buddhi Marambe, chairman of the National Experts Committee on Climate Change Adaptation. “Adaptation is an important aspect when addressing climate change,” Marambe told local press. “In this, agriculture plays a key role. When adapting, we also need to keep in mind sustainable development.”

To that end, Sri Lanka implemented a toxin-free agriculture policy in early 2016 with an emphasis on sustainability and organic farming, as well as food security. The policy provides farmers with capacity-building resources to encourage the switch to organic farming and the resources needed to move away from a reliance on fertilisers. The project also guarantees producers a price per kilo for toxin-free, traditional seed varieties. Toxin free seeds are defined as those seeds grown without the use of fertilisers. The programme will span three years.

The adoption of organic farming practices complements government efforts to address the challenges posed by climate change. Therefore, it is the government’s expectation that it wil be able to encourage more sustainable, eco-friendly practices and boost the sector’s competitive advantage.

Joining Hands

International partners are joining the government in efforts to modernise the agriculture sector and promote knowledge transfer. In June 2016 the World Bank approved a $125m credit from its International Development Association to aid Sri Lanka in modernisation. The assistance is intended to help the sector by increasing efficiencies and boosting its attractiveness, while making it more responsive to consumer demand, resilient to climate change and environmentally sustainable.

The project will be implemented through the Ministry of Primary Industries, the Ministry of Agriculture and stakeholders in the Northern, Eastern, Central, North Central and Uva provinces. According to the World Bank, 30,000 smallholder farm households in the project areas will benefit directly from the project’s small-scale matching grants and agriculture technology demonstrations. These demonstrations will showcase new agricultural practices and institutional arrangements in targeted project areas, linking smallholder farmers to a modern agriculture value chain to promote commercial and export-oriented agriculture, as well as creating new employment opportunities.

Additionally, technical and business training, combined with the establishment of professional farmer organisations, will enable farmers to manage more effective, business-oriented enterprises. The World Bank estimates that these training sessions will benefit another 20,000 households.

Land Rehab

The authorities are also looking to rehabilitate degraded agricultural land, which has been worn down by soil erosion as a result of abandoned and poorly managed tea plantations. Degradation of the soil has led to reduced agricultural productivity. Around half of the land in Sri Lanka’s central highlands – most of it around Kandy, Badulla and Nuwara Eliya – has been depleted.

In August 2016 the government announced an $11m project aimed at reversing the degradation and erosion of agricultural land in the Central Highlands. Implementation began in 2016 and will continue through to 2020, with financing from both the Sri Lankan government ($9.7m) and the Global Environment Facility ($1.3m).

Moving Forward

Sri Lanka has long benefitted from favourable agricultural conditions, with a moderate climate, fertile soil and an abundant supply of groundwater. The sector is an economic mainstay and the primary national employer, employing around 30% of the labour force. In recent years new challenges have emerged in the sector, notably reduced productivity and climate change.

However, the government’s prioritisation of development and modernisation – combined with the sector’s competitive advantages – creates opportunities for growth. Forward-looking initiatives aimed at boosting crop production, adapting to climate change, encouraging sustainability and addressing soil erosion are expected to have positive results should these plans be successfully implemented.

 

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The Report: Sri Lanka 2017

Plantations & Agriculture chapter from The Report: Sri Lanka 2017