Govt. seeks US$ 700mn from World Bank to buy chemical fertiliser, revive agriculture

The Government has sought a loan of US$ 700 million from the World Bank to revive the agricultural sector by providing imported agrochemicals and seeds after setbacks suffered in the Maha season.

Agriculture Ministry Secretary D.M.L. Bandaranayake told the Sunday Times that the funds had been sought for the ongoing Yala season and the upcoming season covering a one-year period.

He said the assistance had been sought to support cultivation of all main crops including paddy, tea, vegetables, fruits and corn.

The loan also is to be made use of to help the private sector to open Letters of Credit to import chemical fertiliser.

In a related development, Finance Minister Ali Sabry told the Sunday Times that the Government was also planning to use part of the Indian credit line for the import of urea. He said they were planning to make use of US$ 300 million saved from the credit line.

The government’s move to reverse the ban on chemical fertiliser imports came in the wake of islandwide protests and severe crops losses during the last season. The ban was imposed in May last year.Mr Bandaranayake said that the Ministry would, however, continue its policy of supporting the use of organic fertiliser, while providing chemical fertiliser.

In his address to the nation this week, Prime Minister Mahinda Rajapaksa pledged to reinstate the fetiliser subsidy.

“No matter how honorable the notion of organic fertiliser is, it is not the time for it to be implemented. As such, we will be reinstating the fertiliser subsidy to once again equip our farmers to optimise their craft,” the Premier said.