India to help Sri Lanka buy fertilisers and develop Kankesanthurai port
by Arundathie Abeysinghe

The decision by the Rajapaksa administration to opt for organic farming without proper planning is one of the causes of Sri Lanka’s current economic crisis. India is providing a US$ 40 million loan to develop a port in northern Sri Lanka by the end of the year.

Colombo (AsiaNews) – India has extended a US$ 55 million line of credit to Sri Lanka through the Exim Bank of India to buy about 65,000 tonnes of urea fertiliser as part of its “Neighbourhood First”. Sri Lanka’s northern neighbour has also offered help to develop the Kankesanthurai Port (KKS) in Jaffna.

The fertiliser bought with the Indian loan will be used during the Maha season (north-east monsoons from September to March), Ministry of Agriculture sources said.

The fertiliser-carrying vessel left Oman on 2 July and should dock in Sri Lanka early next week.

In April 2021, the Sri Lankan government led by President Gotabaya Rajapaksa imposed a ban on imported chemical fertilisers in favour of organic and biodynamic farming.

The decision, which caught farmers unprepared, caused the loss of entire crops, and the consequent loss of income for farmers, followed by a food crisis.

The government did not consider the technological, environmental and economic costs of an unplanned shift to chemical-free agriculture, which cost in excess of a US$ 1 billion.

In Polonnaruwa, Ampara and Monaragala, Sri Lanka's main rice-producing areas, several farmers told AsiaNews that chemical fertilisers will be a boon for farmers who had "given up farming" because the rice seeds they had are responsive only to chemical fertilisers.

If the authorities wanted to develop biodynamic agriculture, they should have provided different seeds, compatible with organic fertilisers.

Sources in the Ministry of Agriculture told AsiaNews that the government plans to sell 50 kg bags of fertiliser at the subsidised price of 15,000 rupees (around US$ 42), but farmers' associations complain that that such a price is too high at present, proposing instead 10,000 rupees per bag (US$ 28). On the black market a 50 kg bag is sold for 43,000 rupees (US$ 120).

For his part, Agriculture Minister Mahinda Amaraweera ordered officials to keep 2,000 lorries "on standby" to distribute fertiliser supplies.

He also submitted a cabinet paper seeking a guarantee from the Ceylon Petroleum Corporation to provide over 20 million litres of fuel to ensure delivery.

As Prime Minister Ranil Wickremesinghe pointed out, ensuring "food security for the population" is the government's priority.

After defaulting on its debt in April, Sri Lanka faced severe shortage of fuel and food products, including rice, the country’s staple.

Meanwhile, the government wants to develop the Kankesanthurai port thanks to a US$ 40 million loan from India; at present, only small boats can dock at its piers. To this end, the Sri Lanka Ports Authority told AsiaNews that the port’s rehabilitation should be completed by the end of this year.

The goal is to ensure that I ca handle cargo shipping between India and northern Sri Lanka, as well as promote tourism between the two countries, not to mention shipping operations with other Sri Lankan ports, most notably Colombo, Trincomalee, Jaffna, Galle and Oluvil.

Although the port development was planned for some time, political opposition had blocked the project. For economic analysts, once turned into a commercial port, KKS will serve as a national and regional maritime hub.