Agriculture is considered to be one of the most vulnerable sectors to climate change. Although at present, the overall impact of climate change on global scale agricultural productivity is not reliably estimated (Gornall et al., 2010). Many studies show serious implications on agricultural productivity for instance IFPRI(2009) projects that in South Asia by 2050 climate change will reduce production of rice, wheat and maize by 14%, 44% to 49% and 9%-19% respectively relative to no climate change situation. Historical temperature yield relationship indicates that at the global scale warming from 1981-2002 very likely offset some of the yield gains from technology advances, rising CO2 and other non climatic factors (Lobell and Field, 2007).
Developing countries are said to be more vulnerable than developed countries to climate change due to already stressed marginal production environment, heightened exposure to extreme events and scarcity of capital for development and dissemination of adaptation measures (Fischer et al., 2005; Tubiello et al., 2008;). Some of the most impacts of global climate change will be felt on smallholder farmers in the developing countries (Morton, 2007). Climate change can lead to increase poverty among rural communities dependent on agriculture as climate change affects agricultural productivity which in turn affects rural per capita income (Mendelsohn et al., 2004).
In Sri Lanka, about 71% of agriculture land holdings are less than one hectare (Census of Agriculture, 2002) while 66% of cropland is rain fed (Biradar et al., 2009) therefore, it is increasingly vulnerable to impacts of climate variability and extremes. In 2009, the agriculture sector growth was stifled by the impact of drought and delayed monsoon rains on the production of two principal crops paddy and tea (Central Bank of Sri Lanka, 2010). According to recent media reports in January 2011 due to floods more than one million people were made destitute and