New Delhi: A new crisis seems to be brewing between Sri Lanka and China after the Chinese Embassy in the island nation on Saturday declared that the state-owned People’s Bank of Sri Lanka has been blacklisted for failing to make payment for imported fertilizers. Following a court order, the Sri Lankan bank withheld payment to Chinese company Qingdao Seawin Biotech Group Co Ltd after fertilizer samples were found to harbor harmful bacteria.
At the heart of this controversy is Sri Lanka’s sudden decision in April to switch entirely to organic fertilizers, ban imports of chemical fertilizers and use domestic bio-fertilizers. Among other things, the move was seen as a way to dampen Sri Lanka’s dwindling foreign exchange reserves, which have taken a hit in light of the pandemic. The government was expected to save about $ 400 million.
The move sparked protests from farmers, who complained they did not have time to make a change, and soaring food prices.
The daily food prices like sugar, rice and onions soared more than twice, with same sugar moving save Rs 200 / kg; and the prices of kerosene and cooking gas have skyrocketed. There were also fears of an impact on the production of other crucial export crops such as cinnamon, pepper, rubber, cardamom, cloves, nutmeg, betel leaves, cocoa and vanilla.
The country was forced thereafter allow imports of organic fertilizers because it currently does not have the capacity to produce as much organic fertilizer as its agricultural sector requires.
It was put to import 99,000 metric tons of organic fertilizer at a cost of $ 63 million from Qingdao Seawin Biotech Group Co Ltd. However, the shipment was rejected after a scan would have found it to be “tainted”.
The developments have once again highlighted the island nation’s overnight decision to switch to full organic farming.
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Why Sri Lanka needs fertilizer
Many key cultures in Sri Lanka depend on intensive use of chemical inputs for cultivation, with the highest dependence on paddy at 94 percent, followed by tea and rubber at 89 percent each.
This means that Sri Lanka needs a large domestic production of organic fertilizers and bio-fertilizers after its shift to organic farming. However, the situation is grim on this front.
According to estimates, the country only generates around 3,500 tonnes of municipal organic waste every day. From this, only 2-3 million tonnes of compost can be produced on an annual basis.
However, growing organic paddy alone requires almost 4 million tonnes of compost per year at a rate of 5 tonnes per hectare. For tea plantations, demand for organic fertilizer could reach an additional 3 million tonnes.
Currently Sri Lanka produces only 0.22 million tonnes of compost through producers registered with the Ministry of Agriculture and city councils. As a result, the island nation now faces a daunting challenge to produce organic fertilizers.
Imports cause serious concern
In August, Sri Lanka allocated $ 3.8 billion for the purchase of organic fertilizers by import certain nutrients of organic origin, namely nitrogen, phosphorus and potassium.
However, the country had few options like China and India to import cheap organic fertilizers to save their agricultural products.
The Sri Lankan Ministry of Agriculture has selected the Chinese company Qingdao Seawin Biotech Group Co. Ltd. in an open tender to supply organic fertilizers.
Two samples brought into the country and tested by the Sri Lanka Standards Institutions and the National Plant Quarantine Service and the Sri Lanka Atomic Energy Board were found to contain microorganisms, pathogens and diseases harmful to soil, plants and humans.
Sri Lankan scientists have warned that China’s organic fertilizers would be an agricultural disaster as samples were infected with Erwinia, a notorious plant pathogen that causes severe post-harvest losses in crops.
“It also affects root crops which are economically important and which are grown in large quantities. The effect of this pathogen could be found even during post-harvest ”, Devika de Costa, professor of plant protection attached to the University of Peradeniya, a public university in Sri Lanka, Recount IANS.
Farm activists also complained that harmful bacteria species were contained in the fertilizer samples.
Chandima Wijegunawardana, a Sri Lankan lecturer attached to Princess Nourah Bint Abdulrahman University in Riyadh, said IANS, “Ideologically, if this so-called organic fertilizer were to spill out here, the Sri Lankans could be genetically modified.”
While Sri Lanka rejected the shipment this month, China blacklisted the People’s Bank of Sri Lanka, citing a “vicious” “default” letter of credit, reported The Hindu.
Beijing said the Sri Lankan bank’s decision caused huge losses. However, the bank said it was only following court orders prohibiting it from making payments.
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