By Roshini Jayaweera (Research Officer - IPS)
In
considering issues of poverty in Sri Lanka, Batticaloa is conspicuous
as a district that requires particular attention. In addition to being
identified as the country’s poorest district in 2009/10, it is also one
of two districts for which poverty statistics actually increased between
2006/07 and 2009/10.1 According to the latest Household Income and
Expenditure Survey (HIES) 2009/10 of the Department of Census and
Statistics, the poverty rate in Batticaloa district was five-and-a-half
times higher than that of the Colombo district – 20.3% vis-à-vis 3.6%. A
major contributing factor to this is the low agricultural productivity
which the district continues to experience. This is of particular
concern given that the majority of Batticaloa’s residents are engaged in
agriculture – especially paddy farming. This article, based on a survey
conducted by the Institute of Policy Studies of Sri Lanka in 20112,
shares some thoughts on why Batticaloa’s agricultural productivity is
low and is, in turn, keeping its people who are engaged in agriculture
poor.
The
survey focused on two of the poorer and more remote DS divisions out of
14 DS divisions in the Batticaloa district - Manmunai West
(Vavunathivu) and Kiran. In the survey, 1,545 individuals surveyed were
above 10 years of age, and of them 37% were employed - a statistic which
features a larger proportion of men than women. Around 24% of
individuals were students. Nearly 10.5% were unemployed, a percentage
that is slightly higher than the district’s average unemployment rate of
7.4%.3
Youth
unemployment is relatively high in these two remote DS divisions - 84%
of the total unemployed population is less than 30 years old and 31% per
cent of the population aged between 10 and 30 years are unemployed. So,
clearly, attempts at reducing poverty in this district must focus on
strategies to raise employment levels.
Many in Batticaloa are ‘working poor’
A
key issue in this district is the persistence of poverty even among
employed members of the population. The existence of this group of
‘working poor’ indicates that employment does not, of itself, guarantee
an escape from poverty. So, in addition to lowering unemployment,
poverty alleviation efforts must also consider the factors which
constrain earnings among the working population of this district.
The
three largest categories of employment in Batticaloa are agriculture
(largely paddy farming), labour and market gardening (see Figure 1).
Taken as a whole, 58% of workers are employed in the agriculture and
fisheries sector. The majority of these workers are poor due to low
incomes from employment.
Low agri productivity – the blight of Batticaloa?
A
main reason for the persistence of low incomes among this group of
workers is low agricultural productivity. Batticaloa is ranked among the
five districts which recorded the lowest productivity in paddy farming
in the 2010/11 Maha season. Certainly, it may be argued that this is due
in part to the severe floods experienced in this region in early 2011.
However, although paddy productivity has been slightly higher in
previous years (i.e., years unaffected by floods), it has still compared
poorly with other districts even over time. For instance, Batticaloa
recorded the seventh and ninth lowest levels of paddy productivity for
the 2008/09 and 2007/08 Maha seasons, respectively.
Thus,
it is clear that improving agricultural productivity is the key to
transforming the agricultural sector in a manner that meets the
challenges currently faced by the district. Consequently, it is
important to identify the issues that continue to bar the expansion of
agricultural production and incomes.
One
of these is weather and other environmental issues. Among those
surveyed, 33% of people were engaged in agricultural activities and they
reported that this was a key issue for them. Of them, 44% have been the
victims of flooding.4 Simultaneously, however, another 22% have
suffered from drought. This odd combination would suggest that
accelerating climate change may be a contributing factor to low
productivity in the region. One of the best solutions to this is the
introduction of short-age seed varieties, especially drought tolerant
and flood resistant verities. Another possible solution is the
development of the irrigation system and sound irrigation water
management.
“2/3 of the cultivation areas have no irrigation facilities. Rain-fed farming can only be done during Maha season” - key informant, Vavunathiv
Attacks
by wild animals are also a concern in Batticaloa’s agricultural sector.
Nonetheless, measures to minimize the effect of this need to be taken
not merely by the government but also by farmers themselves. The latter
must take the necessary precautions to protect their farms by
traditional methods. The government and Wildlife Department could then
become involved only in cases where farmers are unable to protect
themselves.
A
second important issue which was reported as hindering the expansion of
agricultural production is a lack of capital. Around 12% of farmers in
the sample identified this as a constraint on productivity. Another 11%
identified high input costs as a major concern. Given the links between
the two (high input costs might be considered a consequence of capital
shortages), it may be inferred that nearly 22% of farmers in this area
face financial difficulties in their agricultural activities. This is
mainly due to low incomes which in turn, as previously discussed, result
from low productivity.
Many
farmers in the Eastern Province are now keen to utilise higher
technology techniques in their paddy fields. However, this equipment is
expensive and requires easier access to credit.
“We
do not need storage facilities as we have to sell our whole production
to the moneylender from whom we borrowed money for the cultivation. We
have to sell our products at a lower price to them immediately after
harvesting, although the government is buying it at a higher price” – a farmer from Pudumandapathadi
Qualitative
information gathered during the survey suggests that the issue is
becoming increasingly severe, as most of these farmers also face credit
constraints and cannot sell their products at higher prices in order to
make larger profits. The low quality of these agricultural products also
limits the price that farmers receive and, by extension, their ability
to invest in capital. Most of these farmers are unable to sell their
paddy to the government’s paddy-buying scheme because it does not meet
the required quality standard.
A
solution to these financial issues is microfinance. The results of the
household survey show that currently, the most important financial
sources in Batticaloa are government banks. NGOs, Community Based
Organization (CBOs and moneylenders are equally ranked as the second
most important financial source. Informal financial lending is high
among selected households, mainly due to land ownership issues which
give rise to a lack of collateral. Therefore, the availability of
microfinance can go a long way in bridging this. Although many
microfinance institutions already operate in these areas, and some
government banks also engage in microfinance activity, greater awareness
must be generated among the population on the availability of such
schemes, as well as their benefits. At the time of conducting the
survey, most of the villages in this area had an active producer
organization or farmers’ organization. These could potentially be a
useful medium through which financial institutions could reach the
working poor.
A
lack of access to inputs is a third obstacle faced by Batticaloa
farmers. Insufficient access to seed paddy is a problem, which has
become more severe as a result of the floods experienced in the region
in early 2011. This contributes to the consistently poor quality of the
paddy produced by farmers and, consequently, to the low prices received
at the marketplace.
Visvalingam,
a farmer in rural Batticaloa, installed a pilot micro-irrigation system
on his vegetable plot in 2009, with UNIDO funding. He now earns Rs.
18,000 more a month due to higher yields and lower costs, after moving
to better productivity technology for irrigation. Despite his optimism
for the future, however, Visvalingam echoes the gripes of other farmers
in the area, that getting micro loans from local banks is nearly
impossible.
“We get deceived when buying seed paddy” - A farmer from Mandapathadi
Access
to crop insurance is also limited in Batticaloa. Additionally, a lack
of market access and of infrastructure facilities (notably
transportation) contributes to the phenomenon of the ‘working poor’ in
this area.
Conclusion
Adverse
weather and climatic changes, capital shortages, high cost of inputs,
access to credit difficulties, and poor quality of output are affecting
agricultural productivity in Batticaloa, and impacting on the incomes
of the farmers in Batticaloa. Among these issues, capital shortage
emerged as the most pressing issue that needs to be remedied..
Meanwhile, introducing short-age seed varieties, as well as drought
tolerant and flood resistant seed varieties could help to overcome
issues generated by climate change. For this, greater investment in
agricultural research and development is critical. More access to
microfinance is also required, to help ease financial constraints faced
by the agricultural community. Developing agriculture-based rural
entrepreneurship can also be a solution to the problem of seasonal
unemployment among agricultural workers. Interventions such as these,
particularly those that could improve agricultural productivity, have
the potential to pull up the ‘working poor’ in Batticaloa out of poverty
and ensure better living standards in the future.
The
author acknowledges valuable inputs received from Dr Parakrama
Samarathunga (Research Fellow –IPS) and Asha Gunawardena (Research
Economist – IPS) in developing this article.
References
- Department of Census and Statistics (DCS), Household Income and Expenditure Survey (HIES) 2009/2010.
- This study was carried out in four districts in the Northern and Eastern provinces: Ampara, Trincomalee, Batticaloa and Vavuniya.
- Department of Census and Statistics (2009), “Sri Lanka Labour Force Survey – Annual Report 2009”
- This study was carried out in January 2011 immediately after severe floods in the Northern and Eastern provinces and therefore this figure might not be representative.
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