Bundled climate-smart agricultural solutions for smallholder farmers in Sri Lanka

Abstract

Smallholder farmers are among the most vulnerable to climate shocks in Sri Lanka. Lack of education and technical skills, poverty, risks inherent to agricultural investments, limited assets, and financial capital are major reasons for low investments in enhancing adaptive capacity. The study explores the use of agricultural technologies in improving smallholder resilience to water-related disasters and their opportunities for recovery. We tested four bundled services to promote climate-smart agriculture practices namely weather index insurance (WII), agronomic advisories dissemination via SMS, weather services, and climate-resilient seeds of maize and rice. The integrated solutions are referred to as Bundled Solutions of Index Insurance with Climate Information and Seed Systems (BICSA) to manage agricultural risks in Sri Lanka. The study conducted the bundled solutions in three agroecological regions spread over five districts and covering more than 2,500 farmers in three cropping periods ofMahaandYalaseasons. The results demonstrate that providing bundled solutions significantly protects smallholders against moderate drought events. The satellite-based weather index insurance can offset the long-term consequences of severe yield losses and mitigate the long-term drop in farm productivity. Our findings demonstrate the importance of bundled insurance to mitigate financial risks associated with extreme weather events and enhance resilience to climate change among vulnerable smallholders. It is evident from the study promoting a viable business model among seed companies, insurance companies, and technological partners, along with public institutions such as agricultural extension services can help production-level improvements and develop strategies at both the farm and policy levels that will support a transition to a more resilient farming system.