The government’s decision to immediately ban chemical fertilizers and pesticides to promote green agriculture on the island has serious repercussions on the economy and people’s livelihoods. The government should consider the economic consequences of the immediate ban on chemical fertilizers and adopt a gradual introduction of organic farming on scientific principles.
An immediate ban on chemical fertilizers, herbicides and pesticides would have dire economic consequences for agricultural production, the livelihoods of farmers and the country’s external finances.
A ban on chemical fertilizers would reduce the production of food crops and export crops, impoverish farmers, decrease food availability, increase food prices and reduce the accessibility of low incomes to adequate food, threaten food security , increase import expenditure, reduce export earnings and exacerbate the weakness of the country’s external finances.
The government should consider all the economic consequences of such a sudden ban and adopt a gradual introduction of organic farming on scientific principles and realistic possibilities.
There was a lively discussion on the agronomic and economic consequences of the fertilizer ban in the media, among the scientific community and agricultural economists. Yet, as is often the case, these do not seem to have had any influence on decision-makers.
A few weeks ago, the Sri Lanka Agricultural Economics Association (SAEA) made up of a large number of agricultural economists in Sri Lanka and its members abroad had a lively discussion on the impact of the ban on agricultural chemical fertilizers.
Based on this in-depth discussion, a well thought-out memorandum titled: The Green Socio-Economic Model and the Sri Lankan Agricultural Sector: Insights from the Sri Lanka Agricultural Economics Association (SAEA) was sent to His Excellency the President with a copy at all important policy makers. Last week’s Sunday Times and other newspapers had succinct summaries of this memorandum titled âThe Pros and Cons of Organic Farmingâ.
The PSAB Position
The memorandum states that the members of the SAEA “endorse the government’s decision to adopt a green socio-economic model for development, as we firmly believe that such a strategy would be essential for environmental conservation and development. improvement of human health “.
The Association agrees that “green approaches in the cultivation of crops contribute significantly to the achievement of the Sustainable Development Goals (SDGs)” and “believes that most of the current farming systems in Sri Lanka are not sustainable. . Therefore, their conversion to organic farming systems, in the long term, would help promote the health of the population and preserve the integrity of the nation’s environment.
The letter points out âthat many countries are now taking systematic and pragmatic approaches to achieve this long-term goal by first setting goals, standards, and then investing and encouraging farmers to adopt.
best practices. “
Despite support for green agriculture, the SAEA expresses serious concerns about the advisability of the newly introduced regulations to immediately restrict the import of chemical fertilizers and pesticides through the Extraordinary Gazette No. 2226/48 of 6 May 2021, to achieve the broader development goal mentioned above.
The SAEA predicts massive economic losses due to potential yield losses in the absence of suitable substitutes for chemical fertilizers and pesticides with the implementation of the import ban on fertilizers and pesticides.
The immediate negative impacts on food security, farm incomes, foreign exchange earnings and rural poverty can be detrimental to the achievement of the long-term goals we hold dear. The main concerns of the SAEA and the less costly policy alternatives proposed by its members in place of the newly introduced import ban are that “the policy instrument identified by the government to promote organic agriculture is less appropriate due to potential economic losses and its incompatibility with other objective government policies.
Costs and Benefits: Paddy
He points out that âwhen converting from conventional agriculture to organic agriculture, the government should weigh the technological, environmental and economic costs and benefits. Preliminary results of studies conducted by the SAEA on the potential economic losses of the import ban reveal that average paddy yields can drop by 25 percent if chemical fertilizers are replaced entirely by organic fertilizers and this loss of productivity could reduce the profitability of paddy. agriculture by 33 percent and rice consumption by 27 percent, though paddy is grown only with organic fertilizers with a complete ban on rice imports.
In contrast, applying organic fertilizers with the recommended dosages of chemical fertilizers would improve the profitability of agriculture by 16 percent.
The SAEA points out that the absence of chemical fertilizers would significantly reduce the productivity of vegetatively propagated tea (VPT) by 35% and the export volume from 279 to 181 million kg, which in turn would result in a loss of income of 84 billion rupees.
Plantations are likely to suffer significant losses compared to those of small tea growers and could be further exacerbated due to the increased cost of labor to apply bulky organic fertilizers.
The SAEA points out that coconut yields would be reduced by 30 percent if chemical fertilizers and pesticides are not applied. This situation will have a negative impact on the availability of fresh coconut, the production of coconut oil, desiccated coconut and other coconut products.
According to the report, the loss of foreign exchange earnings can reach 18 billion rupees, assuming that only 26 percent of the total area of ââthe coconut is fertilized. When the additional cost for importing edible oils is taken into account, the loss of foreign exchange earnings will be even greater.
The SAEA memorandum addresses several other negative economic consequences of the fertilizer ban on the government’s GDP, balance of trade, and other development objectives. It then proposes an alternative strategy for agricultural development.
The PSAB suggests that the government use more cost-effective instruments to achieve declared health and environmental outcomes in place of the new import regulations. They note that the global approach to environmental protection has shifted from a regulatory-driven approach to a more proactive one involving voluntary and market-driven initiatives.
Accordingly, they propose the following three-point policy package to encourage organic cultivation using safe and environmentally friendly organic fertilizers and pesticides:
1. Open channels to encourage production, storage, distribution, etc. organic fertilizers and promote public-private partnership (PPP) models to achieve this.
2. Develop national standards for organic fertilizers and pesticides to ensure the non-importation of substandard products into the country and domestic production meeting specified quality standards.
3. Improve knowledge of different organic farming technologies among farmers through a strengthened extension system. These are discussed in detail in the memorandum to the president.
The recommendation of the Sri Lanka Agricultural Economics / Association (SAEA) is that the government lift the ban on chemical fertilizers and pesticides and gradually reduce subsidies on chemical fertilizers.
It would be prudent to consider all the above economic consequences and adopt a gradual introduction of organic farming on scientific principles and realistic possibilities. The economic consequences of the immediate ban on chemical fertilizers are appalling. We should adopt a gradual introduction of organic farming on scientific principles.