Crop Diversification and Export Growth: Dynamics of Change in the Sri Lankan Peasant Sector

Abstract

ABSTRACTSelf‐sufficiency in foodgrains has seen countries of South and East Asia diversifying their agricultural base and trying to move peasant producers from rice to higher‐value crops. This article examines policies applied in Sri Lanka in the wake of structural adjustment. Contract farming and corporate sector involvement are analysed as a mechanism of change, and crop characteristics, the macro policy environment, infrastructural facilities and other state supports are identified as important contributing factors. The government commitment to developing horticultural exports as a major industry is seen as a central issue, given constraints that have emerged in the implementation of this policy and pressures to curtail expenditure and reduce the budget deficit. A better focused and more coordinated package of supports is considered to be necessary. The welfare impact of recent growth is also analysed and is found to give some cause for concern.