Highlights:
• PM Modi had assured Sri Lanka of fertilizer supply for the next cultivation season
• The supply would be delivered under Indian Line of Credit
President Gotabaya Rajapaksa’s office said on June 2 that India has assured Sri Lanka of fertilizer supplies to help the debt-ridden country avoid severe food shortages caused by crop losses and exacerbated by the world’s worst economic crisis.
Overview
President Rajapaksa said Prime Minister Narendra Modi had assured him of fertilizer supply for the next cultivation season while speaking with a group of irrigation officials about the needs for the next harvesting season.
The supply would be delivered under the Indian Line of Credit and distributed within 20 days of the consignment arriving in Colombo, he said. Following the drop in paddy cultivation during the Mahi session, Sri Lanka is aiming to boost its agriculture sector to avoid any market disruptions.
Yala is the paddy-growing season in Sri Lanka, which runs from May to August. Chemical fertilizers were banned in Sri Lanka last year as part of a phased transition to organic agriculture.
Annual cost of fertilizer imports is USD 400 million
The annual cost of fertilizer imports in Sri Lanka is USD 400 million. Fertilizer shortages have enraged farmers across the country, who claims they are being forced to abandon their farms.
More than 2 million people work as farmers in Sri Lanka, and agriculture supports up to 70% of the country’s 22 million people. Since January this year, India has committed more than USD 3 billion to debt-ridden Sri Lanka in the form of loans, credit lines, and credit swaps to assist the neighboring country, which is experiencing its worst economic crisis since independence.
Sri Lanka’s economic crisis is exacerbated by a lack of foreign currency, which has left the country unable to pay for imports of basic foods and fuel, resulting in severe shortages and exorbitant prices.
The crisis has sparked widespread protests and prompted calls for political reform and President Rajapaksa’s resignation.
