Reconstructing Agriculture

The northern economy is mainly agricultural, and the challenges facing its revival after the war also relate to agriculture. If the war disrupted agricultural production in the north for decades, the post-war years have not provided much respite. The long drought over the last two years, has been devastating for the northern farmers. However, untimely rains, floods and crop diseases have also crippled the northern farmers in the preceding years. Significantly, these natural disasters also relate to policy failures, particularly flawed reconstruction of a war affected agricultural economy. The consequences are both disintegration of rural livelihoods and abject poverty with unaffordability of food. 

• Frequent droughts, ill-timed heavy rains can be devastating for agriculture
• 2007-2008 global food crises, leading to shortages and tremendous increase in food prices
• Drought would result in an additional US$ 800 million in food imports - CB analysis
• In 60s and 70’s Jaffna went through a cash crop boom including in chillies and onions
• Restriction of imports alone does not explain the cash crop boom in Jaffna

Blaming climate change for the plight of the farmers is a fickle argument. Irregular weather patterns due to climate change, is a known fact. Such frequent droughts and ill-timed heavy rains can be devastating for agriculture. Yet, agriculture is essential for human life and it is for the Govt to find solutions for such national problems caused by climate change and declines in agricultural production. Some free trade neo-liberal ideologues may propose easy solutions such as importing agricultural produce, but that does not address the millions of livelihoods dependent on agriculture nor the fluctuations in the world market for food. Indeed, the 2007-2008 global food crises, leading to shortages and tremendous increase in food prices, were a rude awakening for those who dismissed the importance of a certain level of self-sufficiency in national food procurement. 

At the root of the agricultural problem I would argue is the lack of both a vision for agricultural development and the miniscule levels of state investment in agriculture. Without investment, agricultural growth is limited and little increase in productivity. The Central Bank Governor a few months ago stated that the drought would result in an additional US$ 800 million in food imports adding to the import bill and aggravating balance of payment problems. The problem with food, as opposed to many other commodities, is that, we cannot ask our population to starve. As the famous saying goes every country is only three meals away from anarchy! 

Cash Crops in Jaffna

In the 1960s and 1970s, Jaffna went through a cash crop boom including in chillies and onions. Even today, many of the farmers in Jaffna remember those days, and claim that was when they first built their cement houses. Neoliberal economists today dismiss that agricultural boom as merely a consequence of protectionism in the 1970s. 

In reality, the agricultural boom in Jaffna preceded the emergence of the United Front Government in 1970. Furthermore, the United Front Government by the 1970s had little choice but to restrict imports. The changing terms of trade for Sri Lanka’s major commodity exports and a virtual blockade of development aid by Western powers that sought to punish Sri Lanka for its turn to the left, created the conditions for restricting agricultural imports due to falling foreign exchange earnings. 

The restriction of imports alone does not explain the cash crop boom in Jaffna. Why is it that the Jaffna farmers benefitted so much and not the farmers in other parts of the country? Questions like those were addressed in an important research initiative by leading Sri Lankan social scientists including Newton Gunasinghe between 1980 and 1982. Their work edited by Charles Abeysekera and titled Capital and Peasant Production: Studies in the continuity and discontinuity of Agrarian Structures in Sri Lanka was published in 1985. Gunasinghe in studying the Jaffna farmers analysed the levels of investment in agricultural equipment, the intensification of labour practices and the particular landed social relations as important factors contributing to the agricultural boom in Jaffna. In comparing four different agrarian systems around the country, Gunasinghe characterised the village he studied in Jaffna as one of an “agrarian system with strong potentiality for growth.” 

Donor Pressures

The problem with our agricultural policy as with our economists today, is that there are few serious studies of agriculture relating them to broader social and economic processes, much less alternative visions for agricultural development. Sri Lanka’s agricultural outlook seems to be all too easily surrendering to the ideological pronouncements of the World Bank and its prescriptions of trade liberalisation in agriculture. The fact is neither from the macro-economic concerns of foreign currency expenditure nor from the necessities of our citizens, can agricultural production be abandoned. 

Sri Lanka’s economic policies increasingly adhere to donor priorities and projects, and even state spending is now shaped by such donors. According to the Finance Ministry Annual Report 2016, out of a total Official Development Aid disbursements of US$ 1,640 million only US$ 15 million was disbursed for agriculture, which was less than 1%. Governmental expenditure is not very different, where total investment in agriculture, fisheries, plantations and livestock together amount to only 5% of total state capital investment budgeted for 2017. 

This national outlook on agriculture has also determined investment in reconstructing agriculture in the war-torn north. According to Finance Ministry data, of state and donor investment in Northern Province between 2009 and 2013 amounting to a total of Rs. 221 billion, only 8% was for agriculture and fisheries, the economic mainstay in the region.

“The 2007-2008 global food crises, leading to shortages and tremendous increase in food prices, were a rude awakening for those who dismissed the importance of a certain level of self-sufficiency in national food procurement.”

Towards Alternatives

In Sri Lanka and in the Northern Province in particular, investment in agriculture and a far reaching agricultural policy vision is the most important priority from a sustainable development perspective. However, as with most progressive concepts, sustainable development is also increasingly appropriated by the neo-liberal agenda, with a push for tradification and connecting to export-value chains. While value addition linked to increasing exports in agriculture would benefit the country’s external finances, without self-sufficiency at the rural, regional and national levels, agriculture will repeatedly succumb to the whims of the profit-making agendas of the large corporate sector and the tremendous fluctuations in the global markets. 

Increasing agricultural production and the livelihoods of farmers necessarily requires investment. There are for example Government supported pilot projects underway in both the north and the south in precision agriculture, particularly drip irrigation, to save water, reduce fertilizer use and increase production. Storage, cooling and processing facilities are necessary to ensure value addition at the local level and farmers get a decent price, as opposed to the small fraction they receive in farm gate prices compared to retail and even whole sale prices. 

The state also needs to control the massive market fluctuations in agriculture through constraints on the market including imports as well as planning and extension services to farmers to diversify production. In short, the reconstruction of agriculture in the north as in the rest of country requires nothing less than a transformation in agriculture, and that is only possible with large increases in local investment along with a credible national vision and policy.