The World Bank has approved a $125 million credit line to help modernise Sri Lanka’s agricultural sector.
The funding will go towards strengthening supply chains, connecting smallholder farmers to markets and shifting production, particularly among rice-producers, toward high value fruits, vegetables and other crops.
Productivity in the country’s rice sector has gradually improved in recent years according to World Bank studies, allowing for the switches. Demonstrations of modern farming techniques will be given to farmers alongside farmer organisation and farmer-agribusiness partnership support.
“While preserving and building on Sri Lanka’s farming traditions, there is now also space to shift focus to diversification and the promotion of high-value and export oriented food crops” said Françoise Clottes, World Bank country director for Sri Lanka and the Maldives, in a statement. “Moving into the future, this shift in approach is crucial for income growth, poverty reduction and reversing the trend in increasing inequality, as well as better nutritional outcomes in the country.”
Tea is Sri Lanka’s biggest export by far, representing $1.5 billion in exports in 2011, according to the FAO. Natural rubber was the country’s second biggest export at $200 million.
World Bank programme leader Ulrich Schmitt said that innovation and new technology would help improve economic efficiency in agriculture, as well as enhancing resilience to natural disasters and climate change.
Agriculture employs 30 percent of the Sri Lanka’s population and represents 10 percent of its GDP.