For the first time since the end of the civil war in Sri Lanka, refugees from the island nation are once again landing on Indian shores. This time, they are not running from war or destruction – they are trying to avoid the consequences of the biggest policy-induced economic disaster worldwide in this century.
The seeds of the current crisis were sown last year with the Tughlaqian decisions of the Mahinda Rajapaksa government – the first to reduce taxes, including slashing value-added tax (VAT) rates by nearly half, which derailed Sri Lanka’s debt management programme. taken off. As if that wasn’t enough, in April last year, Rajapaksa suddenly banned the import of chemical fertilizers and pesticides and decided that the country would switch to organic farming overnight. Warnings by agricultural scientists that such a change would need to be planned and executed over the years, and that a complete re-conditioning of the soil to increase the organic content, were ignored.
The result – a sharp reduction in foodgrain production, even though the decision to organic farming was rescinded after a few months, first for ‘export crops’ and then for rice and other staples, due to severe food shortages and farmers’ protests. The latter, which are now due to be compensated by the government of $200 million.
Sri Lanka lost more than 2% of its fiscal deficit target in 2021, and reckless growth in the money supply has driven up inflation.
A catastrophic overnight ban on chemical fertilizers and pesticides, along with a lack of foreign exchange, has pushed up food prices. Inflation is currently over 15% and is projected to average 17.5% this quarter, pushing millions of poor Sri Lankans to the brink. The government declared an economic emergency last September and implemented rationing of food, sugar and milk powder.
Meanwhile, the trade deficit widened to $8.1 billion in December 2021 from $6 billion in the ‘peak Covid’ year of 2020, even as foreign remittances fell by more than a fifth to $5.5 billion in 2021, Due to which the shortage of foreign exchange increased.
Sri Lanka’s shift to organic farming, lured by the high prices of organic farm products in major western countries, is a cautionary tale for India, which is also pushing for organic and natural farming. Prime Minister Narendra Modi, while addressing a national conference on organic farming in December 2021, warned against the “dangers” of chemical fertilizers and pesticides and urged Indian farmers to switch to natural and organic farming to protect themselves from the uncertainties of climate change. requested to make changes. Urging farmers to adopt cow dung as manure, the Prime Minister said, “We need to take agriculture out of the chemical laboratory and connect it with the laboratory of nature.”
It may well be, but the fact remains that just 1.5% of the world’s agricultural land is organically cultivated. In Andhra Pradesh, Chhattisgarh, Kerala, Himachal Pradesh, Jharkhand, Odisha, Madhya Pradesh and Tamil Nadu, out of 140.1 million hectares (hectares) of net sown area, only 0.409 million hectares is under natural cultivation, according to a written reply from the government. Lok Sabha in August last year
More than half of the world’s organic farming land is in the Oceania region, a major food exporting region. Farmers there have access to advanced technologies and better links to high-profit markets. There is no such thing as equal access to farmers in Sri Lanka or India.
In a recent interview, Budhi Marambe, professor of agriculture at Sri Lanka’s Peradeniya University, regretted that Sri Lanka’s short-sighted decision to ban chemical fertilizers was based on misconceptions and a “romantic” approach to agriculture. “We must not forget this. Agriculture is the only means of livelihood for millions of people.”
This is a warning that India’s policy makers would do well to heed.
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