The Impact of Chemical Fertilizer Ban on the Paddy Sector: Propensity Score Matching and Value Chain Analysis


September 1, 2023 - S.S. Niwarthana, N. Dissanayake, M. Thibbotuwawa and H. S. R. Rosairo


This study aims to evaluate the impact of the chemical fertilizer ban using Value Chain Analysis and propensity score matching methods using primary and secondary data. The study finds a drop in paddy production and yield levels due to the ban on chemical fertilizers. However, there is no significant impact on farm yield or income based on the matched sample as shown by ATT results primarily due to the quick reversal of the ban. Value chain analysis showed that the farmers have faced severe challenges in accessing necessary fertilizer. In going forward, the government should establish a specific national policy for organic farming with a comprehensive action plan including strategies and timebound outcomes. Further, quality standards and guidelines for organic fertilizers manufacturing and use should be established and promoted with incentives for adoption. Extension programmes related to plant nutrient management should be strengthened with modern knowledge, expertise and techniques. Chemical fertilizer should be offered in the short term at market prices to the registered farmers and Integrated Plant Nutrition Management (IPNM), Good Agricultural Practices (GAP) and site-specific application techniques should be promoted to gradually reduce the overuse of chemical fertilizer. Further investments should be made in Research and Development (R&D) related to the aforementioned plant nutrition management and agricultural techniques.


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