General Studies for Civil Service Exams – 5

Sri Lanka faces China’s wrath on organic fertilizer import

In a grand makeover to traditional agricultural practices that need chemical fertilizers, Sri Lanka is trying to make a radical switch to organic farming. The organic fertilizers had to be imported.  The first purchase came from China, but the process has run into unforeseen difficulties, and the fertilizer is lying on board the ship. Starved of fertilizer, the Lankan agricultural sector faces great odds.  The Sri Lankan authorities had signed a deal to import 96,000 tonnes of organic fertilizer from the Chinese company, Qingdao Seawin Biotech Group Co. Ltd. All formalities like pre-delivery quality check, opening of LC in favour of the supplier etc. were completed. Upon arrival though, testing revealed the presence of harmful bacteria in the fertilizer consignment, still loaded on the ship. The Lankan authorities refused to accept the fertilizer and declined to make any payment after obtaining a court order. The aggrieved supplier, backed by the Chinese government retaliated by blacklisting the state-owned Sri Lankan bank that had opened the Letter of Credit (LC). The Chinese are extremely peeved at the Sri Lankan action, and are trying to arm-twist the island nation to accept the consignment and make payment for it. The tussle will end only if the Sri Lankan court lifts its restraining order.  

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