That country will pay US$200m compensation to more than a million rice farmers whose crops failed under a botched scheme to establish the world's first 100% organic farming nation.
Agricultural chemicals such as fertiliser were among the imports banned last year.
These restrictions were lifted months later after farmer protests and crop failures.
About a third of Sri Lanka's agricultural land was left dormant last year because of the imported farm chemicals compounding the island's economic crisis, causing food shortages and forcing shops to ration sugar, lentils and other essentials.
Food inflation in Sri Lanka hit a record 21.5% last month with vegetables and other staples in short supply in the wake of the disastrous organic experiment.
