The booming prawn industry in Sri Lanka has Worried environmentalists. They fear that mangroves will be destroyed to make way for prawn farms and that prime land will be encroached upon, resulting in the destruction of fish breeding grounds and damaging biodiversity. Besides, the waste from the enterprises will add to the pollution.

The focus of the controversy is the Chilaw lake in the northwestern province, where prawn farmers have set up many ponds of about 12 ha each. according to a Panos report. These ponds yield about 50.000 prawns per ha. which sell for approximately Rs 400 each in the US and Japan.