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Home > International Tamil Conferences on Tamil Eelam Freedom Struggle > > Second World Tamil Eelam Convention, 1984 > The Eelam Economy - Satchi Ponnambalam

Satchi Ponnambalam (1984),
Proceedings of the Second World Tamil Convention
Nanuet, New York, U.S.A

The Eelam Economy

Satchi Ponnambalam
[Author of  Sri Lanka: The National Question & the Tamil Liberation Struggle]
June 1984

The land and resources comprised in the territory of Eelam present many similarities and uniformities throughout the area in terms of eco-system that the whole area makes up one integrated regional entity. This distinctiveness should have dictated the economic development of the area on a regional basis. But the more important ethnic and cultural distinctiveness of the people who live in this land of Eelam had led to a systematic policy of wilful neglect of its development. As a result, the pronounced undevelopment and virgin barrennes of the areas comprising Eelam stand out as a monumental testimony to the discriminatory policies pursued over the last thirty years.


While over these years, irrigation, land development, peasant ization in Gal Oya, Minneriya, Giritale, Elahera, Parakrama Samudra, Rajangana, Kantalai, Padaviya, Mai, Hurulu Wewa, Udawalawe, Mahaweli Ganga, and construction projects like the Anuradhapura New Town building, Kandy King's Pavilion, Kotte Parliament Building, high-cost and low-cost houses, Gam Udawa, and several others have been the first things in the lips of those in power and in the front pages of the newspapers, never was anything said about developing the North and East. It was as though these lands and the people never existed. This was because these are the homelands of the Tamils, which had come to be joined to theirs in the wake of colonialism and were left yoked with theirs on decolonization. They evinced no interest over these lands except for settlement by colonization. But to the more than two million of our people who live there, the development of these areas meant everything for their progress.

There was then, and is today, so much of development to be effected in the Tamil areas. In the historic past, Wanni in the centre and Mannar areas in the South-West Eelam were flourishing agricultural regions with some of the oldest and biggest tank-fed, river-based irrigation systems. The Iranamadu tank in Wanni, the Giant's tank and Akattimarippu tank near Mannar are river-based irrigation systems that are disused. The Giant's tank draws its water by channels from Aruvi Aru and Akattimarippu from Kal Aru. The Pomparippu area below Mannar was in the historic period called the 'Golden Plains' buttoday is the dust bowl. Similarly, the Batticaloa area, the rice bowl and granary of Eelam has several disused tanks drawing water from channels connected to a number of rivers. In the Jaffna Peninsula itself, there are the famous Nilaveli, known as the 'bottomless well', Thondamanaru and others, which should have been priority projects of development for irrigated agriculture.

From 1948 to the present day, irrigation, land development and peasant resettlement have been the principal areas of state investment and government activity. Between 1948 and 1974, Rs. 3.4 billion was spent in this field. From 1977 to date, foreign aid from the Western donor countries to the tune of more than Rs. 50 billion has been spent on dam construction, irrigation, land development and peasant resettlement. Of these amounts, not even 0.001% accrued to benefit the Tamil-speaking people of Eelam.

The Committee of Rational Development, consisting 01 Sinhalese, Tamils, Muslims and Burghers, in its report (published in the Lanka Guardian; Colombo; November 1, 1983 stated:

"Foreign aid utilization in the Jaffna District for the period 1977 to 1982 was zero... The per capita capital expenditure in the Jaffna District is Rs. 313, while the national per capita capital expenditure is Rs. 856"

Since, of the Rs. 50 billion funds in foreign aid between 1977 and 1982, nothing was spent in the Jaffna District can anyone seriously dispute that there was deliberate discriminatory exclusion of the Tamil people and their lands from national economic development ?

What of the major industrial development projects established with foreign aid over the last thirty years? All the industrial and manufacturing factories established during this period have been located outside the Tamil areas. And the predominant consideration was employment. These projects included a steel factory at oruwella, a foundry at Enderamulla, a Tyre factory at Kelaniya, a sugar factory at Gal Oya, a glass factory at Nattandiya, an integrated plywood complex at Kosgama, a paper board mill at Embilipitiya, three large textile mills at Tulhiriya, Veyangoda, and Kandy, a hardware factory at yakkala, an asbestos factory at Colombo, a urea factory at Sapugaskande, ceremic factories at Nittambuwa and Piliyandala, oil refinery at Kelaniya, an industrial estate at Ekkala, a barbed wire factory at Colombo, a fertilizer factory at Hunupitiya, cement processing factories at Puttalam and Galle, a flour mill at Colombo, and many others.

Between 1970 and 1975 alone, Rs. 11 million was spent as capital investment in state industrial ventures. Although a Russian prospecting corporation carried out a seismic survey of the Island and recommended Jaffna and Mannar for oil exploration, petroleum prospecting commenced in Mannar, which turned out to be a failure. Jaffna was not tried at all, being the heartland of the Tamil people, as any success would have made the Tamils economically strong.

In the early 1960s, the World Bank, after survey of the entire Island, recommended the establishment of a large sugar plantation and factory at Thunukkai-Pooneryn area, which the Bank considered the ideal location for sugar in the Island. Because these were Tamil areas, the projects were shelved.

The numerous requests by the Tamil MPs for the development of Kankesanthurai and Trincomalee Ports were turned down, but millions were spent to turn the uneconomical port of Galle, as the second port. Even the U.S. Government's offer to develop the Kankesanthurai port as a grant-in-aid project was not accepted.

During the foreign exchange crisis period of the mid-1970s when the farmers were exhorted to produce or perish the Tamil farmers rose up to the situation and produced subsidiary food crops like chillies, onions, and others and the Island became self-sufficient in them. The resulting prosperity of the Tamil farmers even earned the surprise and envy of those in power. Many went to the North to see how it was being achieved and were amazed at the enterprise and hard work of the Tamil farmers. But with no consideration for the efforts of the Tamil farmers by which the country benefited, an open economy and liberalized imports was instituted from 1977 and the prosperity of the Tamil farmers collapsed soon thereafter. Imports of chillies, onions and other subsidiary foodstuffs became the order of the day. Here is the text of a typical tender notice for the import of dried chillies, which appeared in the SUN of 27th July 1982 :—

"Tender for the Supply of Dried Chillies".

Quotations are invited from suppliers abroad for the supply of 500 metric tons Dried Chillies for shipment during August/ September 1982. Offers should be addressed to reach the Secretary, Tender Board, Co-operative Wholesale Establishment, 440 Union Place, Colombo 2."

Due to the absence of development over the last thirty years of the land and resources of the Tamil people they lie barren and atrophied. Devoid of any development the Eelam economy languished and stagnated. Constricted by discriminatory exclusion, the people lost their creative vigour and vitality and their self-reliance and capacity for enterprise and progress.

Land, People and Resources of Eelam for Economic Development.

According to the 1981 census, there were 1,111,468 people in the Northern Province, distributed among the four Districts as follows:

Jaffna 831,112
Mannar 106,940
Vavuniya 95,904
Mullaitivu 77,512

The distribution of population among the three Districts of Eastern Province, are as follows:

Batticaloa 330,899
Trincomalee 256,790
Amparai 388,786

Of the 1,111,468 people of the Northern Province, Tamil-speaking people numbered 1,075,866 and of the 978,475 people of the Eastern Province, Tamil-speaking people numbered 728,852.

Taking the entire Tamil-speaking people of the Island as the citizenry of Eelam, the man-land ration would be 1.4 acre. If the nearly one-third land area that is not arable is excluded, there will be 0.9 acre per person in Eelam. This area per person is considerably more than in many other countries, hence on a comparative basis there need be no concern for land-shortage or land-hunger in Eelam. On the contrary, land and labour power become Eelam's most abundant resources.

The conventional wisdom, which heavily influences our thinking is that nature's distribution of good soil and water in Eelam has been very selective. This does not hold true. In the traditional system of farming nature's niggardliness in regard to soil and water operated as serious constraints. But in terms of today's scientific and technological farming practices, these are not serious limiting factors. Technological advances in agriculture have broken through the stranglehold of soil and water, weather and seasons. Deficiencies in soil nutrition are today easily corrected by applying lime and fertilizers. More importantly, there are crops that have been identified and seeds which have been bred to suit the nutrient deficient soils. We may at this stage briefly consider just one plant — sunflower.

Sunflower  has today come into the centre of stage as a superior edible oil of high commercial value. Sunflower oil is nutritionally better than all other edible oils. The plant performs exceedingly well in the worst drought conditions and is ideally suited for extensive cultivation in Eelam soil conditions. Its export market and foreign exchange earning potential is many times more than tea, coffee, cocoa, rubber, coconut produces, etc. Sunflower is pre dominantly a dry crop and comes to harvest in 140 — 150 days. The cost of cultivation, in comparative terms is exceedingly low — Rs. 1,000 per acre and can be estimated to bring in a profit of Rs. 6,000 per acre a rate of profit substantially more than any other tropical crop.

Even nature has not been that niggardly as has been made out to be to Eelam. The northern lowland region consists of fertile rolling plains intersected by rivers and ridges. There are several rivers traversing the northern plains. There are the Mandekal Aru emptying out at Pooneryn, the Pali Aru emptying out near Vellankulam, the Parangi Aru emptying out north of Vidulthaltivu, the Aruvi Aru the second longest in the Island —104 miles emptying out near Mannar, the Modarakam Aru emptying out below Mannar, the Kal Aru and the Yan Aru, south of Mullaitivu and north of Trincomalee, respectively. The lands of the extreme north-west around Mannar are described as "arid", yet the rainfall averages in this area around 40 inches per year. It is misnomer to describe an area that receives such amount of rain as "arid". Those were the descriptions of foreigners who knew little about how the monsoons were superimposed on the equatorial regime and the intricacies of tropical agriculture.

They made a simplistic generalization that all lands which received less than 50 inches of rainfall a year are "arid". And it has been perpetuated by local bureaucrats who have no commitment to development of indigenous resources.

The Mannar-Vavuniya-Mullaitivu belt contain plenty of reddish brown alluvial soil suitable for many crops for local consumption as well as for export. In this belt, and in particular along the Aruvi Aru banks vast acreages of land could be cultivated with cereals like wheat, barly, sorghum and millets, as well as cotton, oil seeds, leguminus pulses, fruits, in particular citrus. This area is ideal for mangoes, bananas, pineapples, passion fruits, etc. Cashew, the "king of nuts" which has an unsatisfied demand in the US grows wild in most places around Mannar and Batticaloa. Cashew belongs to the same botanical family as mango — Anacardiacone — and both thrive in the same agro climatic zones and soils.

An estimate of the export market for tropical fruits in the Middle East alone, according to one report is as follows:

"In 1979, imports of tropical fruits into UAE, Bahrain, Mater, Saudi Arabia, Kuwait and Oman amounted to nearly US $50 million. India, Pakistan and Lebanon were the leading suppliers. Mangoes remained the most popular fruits among all varieties. Bananas have a very big demand in the area — estimated around 50,000 tons a month. The most popular are the long bananas, now imported from Latin America, Ivory Coast and Philippines".

The Eastern part of Eelam consists of an undulating plain and the soil is generally fertile and at places sandy. In the Trincomalee lowlands, the annual rainfall averages 64 inches, which Is relatively a large amount of rainfall. The presence of some of the best soil in Batticaloa attracted enterprising agriculturists and land speculators from Jaffna at the turn of this century. Batticaloa was indeed traditionally known as a rice-surplus area, so much so the Portuguese historian De Barros argued that the name itself meant "rice kingdom". The Government Agent of Batticaloa, in his Administration Report of 1915 stated that "this is one of the few districts which can support itself on its crops and also export rice".

The soil and the agro-climatic conditions of the lands around Mannar and Batticaloa are ideal for another drought resistant export crop —jojoba (pronounced ho-ho-ba), called the "miracle bean". Hence we shall consider its potential in some detail. The jojoba is native to the Sonora desert and arid sands of Arizona and California, where annual rainfall is limited to 5 inches an year. Jojoba bean is the source of an oil that is sought for its unique properties in industry, cosmetics, special waxes, proteins and the lubrication of delicate mechanisms. Jojoba bean contains 50% oil, which never gets rancid nor does it deteriorate even after long periods of high pressure, high-temperature use. Jojoba agriculture is attracting the attention and interest of investors throughout the world. The plant resists draught. According to one Import: "At the present rate of growth of jojoba plantations worldwide, it is estimated that it will be10 years before supply meets current demand — and demand is still growing".

Jojoba bushes begin to yield an income crop after the third year. The maximum yield begins at 10 years and continues for100 years or more. According to estimates, 700 shrubs planted per acre, in the third year the yield should be 600 pounds of beans per acre, or approximately 42 gallons of oil. An acre of mature shrubs is estimated to produce 4,000 to 7,000 pounds of beans.

Costa Rica in Central America has the world's second largest jojoba planting after US and its success should be of interest. The Jojoba Oil and Seed Industries established its plantations in areas where temperature ranges from 70 to 100 degrees. The company has a capitalization of 20,000 common shares of no par value with a minimum participation of 10 common shares at $500 per share. Each participating unit of 10 shares guarantees product yield on half an acre of planted jojoba. Similar projects in Costa Rica have been doubling of share value in three years.

Although wheat cultivation in the Island is unheard of, according to test results obtained by cultivation in 9 districts by the Bandarawela Regional Research Centre of the Department of Agriculture in 1982, best results were obtained in Jaffna, Vaniya, Mannar and Mullaitivu. The Report released by the Centre states as follows:

15 tons of seed of the "Sonalika" variety were obtained by kind courtesy of the FAO for cultivation in about 250 hectares of farmers' fields. Unfortunately, late planting and the unusual drought experienced during this particular season were detrimental to crop growth in several locations. Despite this set back, satisfactory results were obtained in nine districts, particularly in Jaffna, Vavuniya, Mannar and Mullaitivu.

District Agro Ecological Region Average Yield (kg/ha)
Jaffna Low Country Dry Zone 2595
Vavuniya Low Country Dry Zone 2150
Manner Low Country Dry Zone 2010
Mullaitivu Low Country Dry Zone 1965
Trincomalee Low Country Dry Zone 1385
Nuwara Eliya Upcountry Wet Zone 1945
Ratnapura Low Country Wet Zone 1535
Badulla Upcountry Intermediate Zone 1975
Moneragala Low Country Intermediate Zone 1705

The highest yield of 2595 kg/ha or 38 bushels/acre was obtained in the Jaffna District.

Despite the very promising results obtained in the four Northern Districts, nothing has been heard about wheat cultivation in those areas. What was expected by the authorities were results that would show that wheat could be successfully cultivated In the up-country areas. This was however not forthcoming. This could be seen in the conclusion to the Report, which states: "Particular attention will be paid to production promotion in the cool up country, where wheat will be introduced to the paddy fields during the Maha season wherever the cultivation of rice is bedevilled by sterility problems caused by cold weather prevailing during this period".

With regard to rice cultivation, by proper utilization of the land and the resources, in particular by releasing the unutilized lands to the people and by several support schemes, Eelam could become self-sufficient in rice — the basic staple — relatively soon. The per capita consumption of rice is about 125 kg, and this demand could be met even on the existing land under plough with the abolition of landlordism, which is a serious debilitating factor in rice cultivation in Jaffna, Batticaloa and Wanni. The landlord does not receive rent but a share of the yield per acre. The landlord's share of tenant's rice produce is the highest in Jaffna, followed by Batticaloa. In Jaffna, it is 54% and in Batticaloa, the customary share is over 50%. Landlordism of paddy land operates as a serious constraint on productivity and the only economically justifiable course is its abolition and the handing over of those lands to the actual tillers. This age-old exploitative arrangement is indefensible and socially oppressive and cannot be corrected by any tenurial reform short of abolition and redistribution.

In this Paper, it is not intended to cover the cultivation Of subsidiary food crops like chillies, onions, potatoes, vegetables, or dairy, poultry, piggery, or the strength or weakness of the types of farming that are currently in operation or that should be adopted in the future.

In regard to mineral resources, no specific survey has been carried out in Eelam to determine their presence. The existing known resources include 4,000,000 tons of ilmenite located at Pulmoddai, north of Trincomalee and additional deposits at Thirukkovil. Quartz, used for glass making is available in Trincomalee, Limestone suitable for cement manufacture is available in plenty in the Jaffna Peninsula, which itself is made of limestone and is underlain by a coral reef. The seismic survey conducted by a Russian corporation in the late 1960s, indicated the presence of petroleum in Jaffna, and it seems to be quite likely because of the recent discovery of large quantities of offshore oil along the Tamil Nadu coast.

This brief outline survey of the resources for economic development reveals Eelam as a land with promising prospects and contradicts the often encountered pessimists vision.  The economic potential and viability of Eelam in its own right and on a comparative basis is exceedingly sound and ranks infinitely superior to those who export tea and rubber and import rice and wheat or the few countries that export bananas or peanuts only. What is important is the willingness for progressive change and those who insist on being presented with a blueprint for prosperity before they move an inch are not interested in any. progress or change.

Most of all colonialism had not tied up the best lands of Eelam for agro-export capitalism. Consequently, one of the greatest strengths of the Eelam economy is that the mode of production is structured around raising of foodstuffs and oriented towards satisfying the demands of the people. This provides the foundation for economic self-reliance and independent economic development. But, the fact that Eelam has the resources to build a viable economic structure is not sufficient. We must have the conviction and work to the proposition that a good life and success can be attained for all and not for the wealthy few. Though resources and man-power may exist, if their control falls into the hands of the few, then the lot of the many will only be poverty and misery. It is to prevent the resources and the means of production falling into the hands of the few that socialist ideology should be adopted and Policy decisions should be directed.


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