The consolidation and expansion of the plantation sector is the central theme of the economic history of Sri Lanka in the second half of the nineteenth century.1 In the mid-nineteenth century, the ascendancy of the coffee industry—fully recovered from the depression of 1847–48—seemed to be so conspicuous as to present convincing evidence of a trend towards monoculture (either the cultivation or the export of one crop exclusively) in the plantation sector of the island’s economy. But this was not to be. The coffee industry went through the normal succession of peaks and troughs, to which any plantation product is subject, over a period of four decades; but more dramatically it withered away never again to recover. Moreover, throughout these decades, there was the unobtrusive but steady expansion of coconut cultivation to the point where it offered a potential challenge to the pre-eminence of coffee in terms of the area covered by coconut plantations, if not in regard to the volume of revenue and profits from the industry. At the same time, from the late 1860s, tea and cinchona established footholds in the plantation districts and soon ceased to be merely experimental crops. Throughout this period they remained in the shadow of the giant coffee industry, but both demonstrated their viability as commercial ventures and their potential for future development. Nevertheless, in the period from 1850 to 1880 the coffee industry had such a preponderant position in the economy that this chapter is best introduced by a review of the main phases in the development of that industry in these decades. This is all the more necessary because the coffee industry was always the pacesetter in plantation agriculture and during the period of its ascendancy it was the catalyst of modernization. Almost every salient feature of modern Sri Lanka may be traced back to the coffee era.
In the course of the early 1850s coffee culture became once more a profitable commercial venture. We have seen in the previous chapter how scores of plantations had changed hands during the crisis of 1847–48 at very low prices and their new owners were able to start off without the crippling burden of their predecessors’ debts. Although coffee prices never attained the heights they had reached in the early 1840s, there was an adequate if not substantial margin of profit because of improved techniques of production and management. The expansion set in motion by the stimulus of rising prices and increased demand might have been swifter in the five years (1850–55) of Sir George Anderson’s administration, if he had not been so inhibited by his instructions to establish ‘an equilibrium in the island finances’. There were three things that the planters sought from any colonial governor: first, generous government expenditure on the improvement of communications; second, state-sponsored immigration of Indian labourers and, along with this, increased welfare measures for these immigrants; and finally, the ready availability of Crown land for plantations. The order of priority they attached to these requirements depended on the circumstances of the day. Anderson’s cautious financial policy was anathema to them. Backed by the unanimous support of the press, the planters launched a vigorous campaign against the stringent economies in government expenditure which was the keynote of his administration.2 Anderson’s prudence, however distasteful to the planters, was not entirely without benefit to the colony’s economy, for the surpluses he accumulated enabled Sir Henry Ward, whose appointment as governor in 1855 marks the start of a period of remarkable prosperity and expansion in the coffee industry, to adopt a more confident note than had been possible for Anderson. It could also be said that ‘the coffee industry’ was in need of a period of quiet consolidation after the trauma of the depression of 1847–48, before being able to cope with another phase of expansion. Anderson’s restraints on government expenditure on roads and bridges were conducive to this process of consolidation, even if the plantation community was in no mood to appreciate its benefits.
The crux of the problem in the planters’ view was that communication between the interior and the coast had become uncertain, costly and inadequate. The existing roads formed part of the lines of communication developed by Barnes in the 1820s for strategic and security purposes. To these there had been a few haphazardly made additions, but there had been no attempt at a major overhaul of the roads, much less the construction of new roads into the more inaccessible plantation districts. Anderson himself had made one of the few noteworthy additions to the system—the road from the Ginigathena Gap to Yatiyantota, constructed in the hope of facilitating the transport of coffee from Ambagamuva and Kotmale to the Kelani River and thence by boat to Colombo. The road system as it then existed was totally inadequate to meet the needs of the plantations and a coffee industry poised on the verge of another period of expansion was in danger of being stifled as a result. This Ward understood. Taking advantage of an expanding revenue and the surpluses accumulated by his predecessor, he adopted energetic measures for the extension of the existing roads and the construction of new roads for the specific purpose of serving the plantations. Between 1855 and 1860 he spent over £1 million on the construction of roads and bridges. On his departure from the island he left 4,800 km of roads in good repair and all the major roads were adequately bridged. Nevertheless, the roads could barely keep pace with the pressures imposed on them in transporting increasingly larger quantities of coffee produced by a rapidly expanding coffee industry. A railway was clearly necessary. As early as 1845, there had been plans for a private company to finance the construction of a railway from the coast to the plantation districts, but this venture proved to be beyond the capacity of private investors on the island and was not sufficiently attractive to foreign (that is, British) capital. Ward took steps to make the railway a reality, as a state enterprise. Much of the essential preliminary work—the surveys, estimates and contracts—was in the process of preparation, if not completion, before he left the island.
In 1858 there occurred, under Ward’s direction, a radical departure from the established policy on Indian immigration. The principle of state supervision of the immigration of Indian labourers was at last accepted. The new policy was not the success it was expected to be. It did not end the seasonal shortages of labour on the estates. But to some extent this may be explained by the entry of a new factor which tended to upset all calculations—the laying of the railway line from Colombo to Kandy which offered another source of employment to the immigrant labourers. Again, under Ward, the surveyor general’s department was able to secure its quota of competent surveyors at long last, with the result that Crown lands suitable for plantation agriculture were made more readily available to the planters than had been the practice in the past. Nevertheless, a cadastral survey of the island, the lack of which had greatly hampered the efficient sale of Crown lands in the previous decades, was still beyond the capacity of the surveyor general’s department to provide, despite the increase in its cadre of surveyors (indeed this cadastral survey remained an aspiration which never materialized during the whole period of British rule on the island).
During Ward’s administration the coffee industry enjoyed a period of expansion comparable to that in the years 1845–47. By 1857 the area under plantation coffee had increased to 32,739 hectares (it was 20,234 hectares in 1847) while there were over 19,440 hectares owned by peasant cultivators. Besides, cultivation was expanding into the forest-clad mountains of Dimbula, the region around Adam’s Peak and into the forests of Haputale (in Uva). Although the coffee boom continued into the early years of the administration of Ward’s successor, Sir Charles MacCarthy, there was a reversion to the stringent economies that characterized Anderson’s regime and road construction and maintenance was reduced to a minimum, while a succession of droughts and unprecedented floods contributed to a swift deterioration of the roads serving the plantations. All the while under the stimulus offered by the consolidation of coffee prices at about 54 shillings a hundredweight for plantation coffee, and 40 shillings for peasant coffee, the area under coffee cultivation kept advancing steadily, thus increasing pressure on the existing roads and creating the need for further investment in road construction.
But MacCarthy’s sights were set on the construction of the railway to Kandy and he would not be diverted from this to what he regarded as matters of lesser importance, such as investment on roads. He set about piling up surpluses to pay off the debts incurred in constructing the railway. The Colonial Office for its part was mainly interested in ensuring that the colony paid an enhanced military contribution. Accustomed to the spacious days of Ward’s administration, the planters were exasperated by MacCarthy’s policies and their frustration was aggravated by the Colonial Office’s single-minded pursuit of an increase in the military contribution. A campaign was launched under the aegis of the plantation community, both within the Legislative Council and outside it, for enhanced government expenditure on roads. In the Legislative Council they dramatized their dissatisfaction by strenuously opposing the military payment to the imperial exchequer and by raising a demand for the control of the colony’s finances by the unofficial members of the Legislative Council.
This review of the recovery and expansion of coffee cultivation in the two decades after 1847–48 emphasized the importance of the development of transport facilities as a factor in the process. The setback which occurred in 1866 drew attention to another vital element in plantation agriculture—capital. Techniques of cultivation had improved markedly since the first experimental phase of the early 1840s, but the financing of coffee cultivation and production was still as haphazard and speculative as it had ever been. Although very little foreign capital was invested in the island’s plantations, the events of 1866 showed that it could nevertheless make the difference between viability and failure in lean years. In 1866, the plantations on the island suffered losses because of their dependence on the London money market at a time when investors were increasingly wary of plantation agriculture in the Indian subcontinent; and by the failure of banks whose losses elsewhere brought down their branches on the island. However, the depression of 1866 was much milder in its impact on the economy than that of 1847–48 and within a year the damage was repaired to the extent that between 1867 and 1871 the area under coffee increased by 14,175 hectares, chiefly in Uva and Sabaragamuva but in other regions as well. Coffee planters turned once more to the Southern Province, but this time to the mountainous Moravak kōralē within easy reach of Uva and Sabaragamuva. Because rail transport had led to a striking reduction in transport costs, a price generally around 54 shillings a hundredweight (cwt) was sufficient to sustain the momentum for expansion.
In the last years of Sir Hercules Robinson’s administration, and in the whole period of Sir William Gregory’s administration, coffee cultivation enjoyed its last and longest spell of unbroken prosperity.3 In the 1870s it reached its zenith. The area under plantation coffee rose from about 79,380 hectares in 1871–72 to about 110,565 hectares in 1878 and dropped to around 103,680 hectares in 1881. The export crop had reached 1 million cwt for the first time in 1868. Similarly, prices reached unprecedented heights in this decade. In 1875–89, the annual average was around 109 shillings per cwt. Increased exports swelled the coffers of the state and budget surpluses were used to expand the network of roads and railways. In 1871, the railway was extended from Kandy to Navalapitiya through Peradeniya and in the late 1870s its continuation to Nanu Oya was planned, as well as the construction of a branch line from Kandy to M•tale. On the coast, a southward expansion to Kalutara was proposed. With the opening of the Suez Canal there was a noticeable increase in the number of ships calling at Galle and Colombo and faced with the choice of developing one of these as the island’s main port, Gregory decided on Colombo. The development of the harbour there was the last link in the comprehensive communications network of the coffee era, but it is ironical that before work on Colombo harbour was completed the coffee age had come to an end.
A leaf disease—Hemileia vastratrix4—was the undoing of coffee culture in the island. It had first appeared at Madulsima as early as 1869; over the next decade it spread rapidly and relentlessly into every other coffee district. Soaring coffee prices encouraged planters to expand production even when it was obvious that the leaf disease had led to a perceptible reduction of production per acre. Coffee planters felt apprehensive that the industry was stricken by a mortal ailment. There was abundant faith in its resilience and hope that improved techniques of pruning and manuring and the introduction of more disease-resistant varieties of coffee would save the day. But these expectations proved too sanguine. From the beginning of the 1880s the decline was swift and almost total. The coffee plantations in Uva, seemingly more resistant to the disease than those elsewhere, survived into the 1890s but these too eventually succumbed.
The last quarter of the nineteenth century saw an astonishing recovery of the plantation economy from the near-bankruptcy to which it seemed destined when the coffee industry collapsed. The three decades from 1880 to 1910 mark a period of sustained growth in the plantation sector of the economy which matched, if it did not surpass, that achieved in the coffee era. It is in these years that the pattern of an overwhelming dominance of three major plantation crops (tea, rubber and coconut in descending order of importance) in the island’s economy was established and which survived in the face of all efforts to diversify the economy and to reduce its dependence on them. Of these crops, tea and rubber (but more especially the latter) emerged into full bloom after the collapse of coffee.5 Coconut, on the other hand, has a longer history as a plantation crop in British times.
Statistical information on all aspects of the island’s economy in the nineteenth century is scanty and often unreliable as well. Those relating to the coconut industry are scantier and more unreliable than most others. Nevertheless, it would appear that in the second half of the nineteenth century the expansion of the area under coconut was as noteworthy as the establishment of the tea industry. The rapid expansion of the coconut industry had begun in the late 1850s, but the pace had been accelerated in the 1860s; the area under coffee went up from about 1,01,171 hectares in the 1860s to about 3,43,938 in the first decade of the twentieth century. Much of the expansion had occurred before the collapse of coffee, although the ruin of the coffee industry may well have contributed to this extension of the area under coconut. It is a point worth noting that the sale of Crown lands to Sri Lankans for coconut cultivation increased by over 200 to 300 per cent in the North-western Province during the 1880s, in complete contrast to trends elsewhere on the island. The area under coconut constituted 37 per cent of the total area under cultivation in 1871 (more than the area under coffee which accounted for about 21–23 per cent); it increased to 41 per cent of the total cultivated area in 1900 (when tea was 20 per cent and paddy 32 per cent). The main centre of coconut cultivation was the south-west littoral, especially the coconut triangle Colombo-Kurunegala and Chilaw. Coconut cultivation was of importance in the economies of all coastal districts, including the Jaffna Peninsula in the north and Batticaloa in the east. It was by far the most significant agricultural product in the Western Province and the North-western Province, and a major crop in the Southern Province.
There are four noteworthy points with regard to the coconut industry. Of these the first and most important was the dominance in it of local capitalists, principally low country Sinhalese, but with a sprinkling of indigenous Tamils. In the early 1880s, only about 12,140 hectares were under European ownership. While European planters became interested in coconut in the mid-1890s, their investment seldom rose above 5 per cent of the total. As with other plantation products, however, the processing and shipping of coconut products was largely controlled by British commercial houses. The predominance of the local capitalists in coconut cultivation is partly explained by the fact that it required much less capital investment than coffee or tea and the maintenance of coconut plantations was also simpler and cheaper. As a result—and this is the second point—the greater part of the area under coconut was under smallholdings, often at the expense of paddy. Third, coconut cultivation required much less labour than coffee and far less than tea (about one labourer for each 4 hectares of coconut on the larger plantations, whereas for tea the requirement was as much as one per hectare or indeed half a hectare). Besides, this labour was often indigenous—the coconut plantations were more closely intertwined with the economics of neighbouring villages than coffee or tea plantations. Both plantations and smallholdings—in coconut—afforded villagers part-time employment which could be conveniently fitted into the cultivation patterns on their paddy fields and chēnas. Fourth, as with other plantation crops, coconut cultivation also provided a stimulus to the extension of road and railway communications. The construction of the southern railway to Matara between 1877 and 1895, the line to Negombo (1907–9) and beyond to Chilaw and Puttalam later on, and the railway to Jaffna through Kurunegala (1894–1905) owed a great deal to agitation from coconut producers especially with regard to the Negombo-Chilaw-Puttalam extensions.
The planters turned to tea and cinchona to fill the void in the plantation sector caused by the collapse of coffee. Of these, cinchona appeared to prosper for a while but failed within a short time. Tea, on the other hand, survived to become the bedrock of the island’s economy by the last decade of the nineteenth century, a position which held till well after the mid-twentieth century. It is important to note that neither the origin nor the early popularity of tea and cinchona had much connection with the demise of coffee culture. Tea cultivation in Sri Lanka, as distinguished from amateurish experimentation, had begun in the 1860s after the widespread impression that tea could not be grown on the island because of its proximity to the equator had been dispelled. The interest in tea cultivation was part of a wider attempt by coffee planters to introduce a variety of other crops which could be conveniently grown alongside coffee at no great additional cost. Interest in cinchona had much in common with that in tea and in contemporary eyes its future potential was virtually on a level with that of tea.6
In the 1870s, the prospects for coffee appeared to be so bright that conditions were not conducive to a major shift of enterprise from coffee to tea. And yet there was an extension of the area under tea at this time, so that by the 1880s there were 5,670 hectares under tea, of which 2,428 were in the Central Province. Economic conditions were rather more favourable for cinchona cultivation. Traditionally, cinchona was interplanted with coffee; it cost less to produce than coffee and so did not tax the capital resources of the planter unduly. Moreover, cinchona was a scarce commodity in the world market, where the island’s product enjoyed a reputation for quality. By 1878, when the coffee disease had spread very extensively, the price of 1 ounce of cinchona had risen to 12s. 6d. By 1883, the area under cinchona rose, from a mere 202 hectares in the 1870s, to 26,305. But its potential for expansion was limited by two factors: the demand for it was inelastic and the tree grew best at elevations over 1,219.2 m. The first of these was a much more formidable constraint than the second, as was demonstrated when increased production in Sri Lanka and Java precipitated a disastrous drop in prices from to 12s. 6d. in 1878 to 1 shilling through the 1890s. The planters turned to other and more profitable crops. By 1900, cinchona was a minor crop with only 1,620 hectares standing. (It had been reduced to an even lower status than cocoa which was also tried in this period, unsuccessfully, as a substitute for coffee.)
Tea survived and prospered. Unlike cinchona and cocoa, it could be cultivated at a greater range of altitudes than coffee (from about 305 to 1,829 m, with the best growing at around 1,219.2 m), while the heavy tropical rainfall, which constantly endangered the coffee crop at critical stages of its growth, actually increased production of tea. Until about 1800, nearly four-fifths of the tea sold in the London market was obtained from a traditional source, China. Indian suppliers provided the rest. At this time there was an increasing demand for tea in the British markets as a stimulating non-alcoholic drink and its price kept rising in response. Within a decade, China’s share of the tea market had dropped to what India’s supply had once been and Sri Lanka benefited from this astonishing reversal of fortunes as much as India herself. In both Sri Lanka and India, there was a notable increase in the area planted in tea. The expansion in Sri Lanka was as much as 8,100 hectares a year up to about 1897. By 1890, the value of tea exports was far greater than that of any other crop; at the turn of the century tea accounted for Rs 53.7 million (and coconut products Rs 16.3 million) of the island’s total export earnings of around Rs 90.8 million.
Tea was the plantation crop par excellence. Its efficient production and processing called for heavy capital investment in large factories and expensive machinery. As a result, smallholders played a much more restricted role in the cultivation of tea than in coffee or coconut and none at all in the processing of tea. The pattern of labour utilization on tea plantations was also notably different from that on coffee and coconut estates. On the coffee estates the demand for labour was seasonal and so the maintenance of a large permanent labour force was not warranted and the vast majority of the seasonal immigrants returned to their homes each year after the coffee harvest. In contrast, the labour requirements on tea plantations were more exacting and were continuous throughout the year. The maintenance of a permanent supply of labour was now a prime necessity. Since Sinhalese labour was just as averse to work on the tea plantations (perhaps more so in view of the year-round demand) as on the coffee estates, the reliance on immigrant Indian labour continued and was reinforced. More important, there was now a change in the pattern of immigration. In the two decades 1880–1900 (during which tea was successfully established as a commercial crop) the increase in migration far exceeded the natural increase of the island’s population. The plantation workers were becoming permanent residents rather than seasonal migrants, thus introducing a new element of plurality into the island’s multiracial society, one which was to have profound consequences for the future.
By the early 1890s profit margins in tea had begun to decline and prices as well. This latter was a reflection of a fall in the per capita consumption of tea in the United Kingdom at a time of worldwide depression. The decline in prices was accelerated by a rapid increase in tea production outside Sri Lanka. The fall in prices continued till 1905, but a crisis was reached by about 1897, in which year the planting of new acreages ceased altogether. The depression in prices was to have far-reaching consequences for the plantation economy in Sri Lanka. Of these consequences the first concerns the tea industry itself, in the organization of plantation activity. In the late 1890s, individual ownership of plantations was quite common if not the rule. But as a result of the slump, there was greater emphasis on better management of production to improve quality, as well as a significant increase in mechanization, all of which compelled an aggregation of individual plantations into units of large combinations controlled by companies. The number of individual estate proprietors was quite small by the end of the second decade of the twentieth century. The tea industry was better able to respond to the increase in prices after 1905. The market for tea remained buoyant till the outbreak of the First World War, as part of the general upward movement of commodity prices.
The area under tea was reduced as was the output, but the emphasis was on quality teas for which prices were high. Thus the recovery of the tea industry was due to two factors: the emphasis on quality in production and the economies of scale inherent in large plantations served by efficient management and increasing mechanization.
The second of the consequences of the depression in prices in the last decade of the nineteenth century was the search for alternative crops. Coconut was conveniently at hand and attracted British and European planters and investors to a much greater extent than in the past. But the most striking development in this search for alternative crops was the emergence of rubber as the third of the island’s major plantation products. Rubber had been introduced on the island in 1877 and survived as an experimental crop, mainly on small plantations. By the 1890s, many British planters as well as enterprising Sri Lankans were impressed with the possibilities of growing rubber on a commercial basis. The area of cultivation, which was at first confined to the Kalutara district, began to spread in other parts of the low country (mainly below the 457.2 m contour) in the Western, Central and Southern Provinces. The swift rise in prices served as an incentive to expansion of cultivation. With the development of the motor industry the rapid growth of the rubber plantations was clearly assured
Smallholders took to rubber production from the beginning and by 1910 controlled about one-fifth of the plantations. The net effect of the introduction of rubber production was to bring large parts of the traditional sector in the Western Province, Southern Province and the Central Province into the export economy. The rubber booms of 1905–10 induced many smallholders to convert their properties into rubber plantations. Very little foreign capital was involved in the development of the island’s rubber industry and the major participants in the establishment of rubber plantations were the tea companies and the indigenous capitalist class. Like the tea plantations, the rubber estates required a large permanent labour force although they were not so labour-intensive as the former. But in contrast to the tea plantations, rubber estates were able to attract local, village labour to a considerable extent.
While the expansion of the rubber industry in the period covered by this chapter and its capacity to attract capital helped to mitigate the effects of the slump in the tea industry, its real significance lay elsewhere and was not confined to a mere growth in volume. By 1910, rubber had replaced coconut as the largest export product of the island after tea. This change became a permanent feature of the economy under British rule and in the middle decades of the twentieth century.
Looking back from 1910 over the sixty years covered by this chapter, one is struck by the remarkable transformation of the island’s economy. One aspect of this has been mentioned earlier, namely that the pattern of the island’s economic development, with three major products dominating the modern plantation sector and the economy as a whole, was established. This survived to the mid-twentieth century despite all attempts at changing it. There is little doubt that the development of the plantations enabled the country to achieve a modest breakthrough towards prosperity in the nineteenth century. While this prosperity was not evenly distributed either geographically or through all strata of society, some of it did seep through to nearly all classes of the people. We have no reliable statistics for computing the growth rate over much of the period, especially in the coffee era, but all the evidence available indicates that economic growth was sustained at a substantial level throughout the period. The growth of the economy in the years 1880–1910 was probably much more solid. The spectacular advance in communications by sea in the late nineteenth century brought down transport costs while at the same time speeding up the process of transport. The railway within the country had much the same effect. It has been shown that some of the tropical countries must undoubtedly have matched the per capita growth of the gross domestic product in western Europe (1.0 to 1.5 per cent) over these years and Sri Lanka was certainly one of these because of the rapidity with which the plantation sector expanded in the three decades after the collapse of the pioneering coffee industry. The modern sector of its economy was much larger in relation to the traditional sector than was the case in many other tropical colonies. Despite the rapid growth of population, both by natural increase and immigration (the rate of population growth was one of the highest in Asia in the nineteenth century), the ratio of population to available and potential land resources was more favourable than in British India or Egypt. The expansion of exports raised the national income per head of population between 1880 and 1910. It was a solid foundation which might have led to self-sustaining growth if tropical trade did not suffer a thirty-year depression after the First World War.7 It was high enough at this stage to give Sri Lanka a standard of living well ahead of that in the rest of south Asia and most of south-east Asia, with the possible exception of Singapore and parts of the Federated Malay States.
If the plantation sector of Sri Lanka’s economy was larger in relation to the traditional sector than in most tropical colonies, the interconnection between the two sectors was also much stronger. At every stage, segments of the indigenous population participated in plantation agriculture. Local capitalists had a share in coffee and tea, were rather more influential in rubber, and were, predominant in coconut. Smallholders (largely peasants) controlled up to one-third of the area under coffee at any given phase of that industry’s development. Although their contribution to the growth and expansion of tea was on a more modest scale, they were influential in rubber and even more so in coconut. The point to be emphasized is that the indigenous planters—capitalists, smallholders and peasants—played a much more prominent role in plantation agriculture than their counterparts in most other tropical colonies in south-east Asia. While labour on the plantations was predominantly Indian, it was never exclusively so; indigenous labour on the plantations varied with the nature of the crop produced and the locality in which the plantation lay, being much greater in coconut and rubber than in coffee, far less in tea than in coffee and much more in the low country and parts of Sabaragamuva than in the Central Province and Uva. Again, some of the services on the plantations and specialized functions were performed almost entirely by the Sinhalese. These included clearing of the forests for plantations and the transport of produce from the plantations to the ports. Till the introduction of the railway, transport was a Sinhalese monopoly, both as regards the workers and the ownership of the carts. The planters made several efforts to bring the transport of coffee under their own control and to break the hold of the Sinhalese in this enterprise, but none of their ventures so much as got off to a start. (Sinhalese expertise in transport, developed through the carts in the coffee era, flourished in the first half of the twentieth century in the form of domination of road transport, both motor buses and lorries.) Government expenditure on roads, ports and railways was intended to benefit the planters mainly, but by their very nature these component elements of a modern transport network served to strengthen the connection between the plantation sector and the traditional sector of the economy.
Economic growth was steady and noticeable. But it was also lop-sided. British agency houses and banks had a dominant interest in the economy. Their control over the processing and export of plantation crops was all but total, even if they did not have a similarly comprehensive hold on production in the plantations, especially in coffee, rubber and coconut. The trend towards the increasing control of the agency houses over the plantation industry was accelerated with the extension of tea production and became even more pronounced in the years after the First World War. From the beginning, an intimate connection was established between the colonial government on the island and the British-controlled export sector of the economy. The corollary of this was a comparative neglect of the traditional sector, a theme which will be treated in a separate chapter.
One aspect of this lop-sided development has been referred to earlier—the dependence of the plantations on Indian labour. We have seen how the special labour requirements of the tea plantations led to a qualitative change in the nature of Indian immigration. But here again this was an acceleration of a trend which had emerged in the last phase of the coffee industry. In 1871 and 1881 there were respectively 123,000 and 195,000 ‘resident’ workers on the plantations. By 1891 this had increased to 235,000. Many of these were now permanent settlers, that is to say they had ceased to be merely seasonal immigrants. It was not the plantations alone which relied on immigrant Indian labour. They were employed in road building, in the construction of the railways and in the harbour, as well as in much hard, unpleasant and tedious work in the towns. An urban and plantation proletariat had emerged. But it was confined to plantation ‘ghettos’ and the less desirable areas of the towns, cut off from the local population by language and culture. Sri Lanka’s Indian problem in its modern form had emerged.
And finally, there is the complex question of land and population. The plantations and British land legislation of the coffee era are believed to have resulted in the equivalent of an enclosure movement, with its predictable consequences—the disintegration of the peasant economy, landlessness among the peasants and social discontent, especially in the Kandyan areas. Comprehensive studies of the economic history of Sri Lanka in the nineteenth century, through which these theories and hypotheses could be tested, have not been made. The, statistical information is meagre and far from reliable. Nevertheless, our knowledge of these processes has increased considerably in recent times. Up to the depression of 1847–48, 101,250 hectares of land had been sold, mostly to European coffee planters, in the Central Province, the heartland of the old Kandyan kingdom. Although a few Sinhalese did obtain some of this land, the vast bulk of it ended in British hands. Many of these British purchasers were speculators. But the crisis of 1847–48 put an end to this phase of development and land speculation. Speculative purchases of Crown lands were much less after 1850, since much of the expansion of coffee culture was on lands that had been sold earlier. In the second half of the nineteenth century there was a remarkable change in regard to the purchase of wastelands from the Crown. During the period 1868–1906, ‘non-Europeans’ bought 72 per cent of the Crown lands sold in Sri Lanka. Although these ‘non-Europeans’ were not necessarily all Sinhalese or indigenous Tamils, these two groups—and especially the Sinhalese—were the main buyers.8 Second, the largest number of sales were of small allotments. Third, sales of Crown lands were not confined to the Kandyan areas but covered all parts of the island. The Central Province and Uva apart, most of the Crown lands in other areas were sold to ‘non-Europeans’. In this thriving land market planters were not the only buyers. Smallholders were a key element, even if they did not dominate the market. Nor were sales confined to Crown lands; peasant holdings in villages and the partition and sale of freehold property (paraveni pangu) became increasingly important. Indeed, a good deal of the expansion of plantations occurred on lands privately owned and freely sold for the purpose.
To what extent did land sales of plantations act as a constraint on peasant agriculture? If one were to confine one’s answer to the coffee era proper and the Kandyan area and especially the Central Province, it would appear that there was an adequate supply of land in the periphery of the villages for the potential cultivation needs of the immediate future. The population of the Central Province in the mid-1850s has been estimated at 150,000. On this computation the peasants of the Central Province had quite adequate resources of land for paddy cultivation and for chēnas during the coffee era, that is, c. 1830 to c. 1880, despite the fact that the population more than doubled in the same period and despite the conversion of at least 20,250 hectares of chēna into ‘native’ coffee.9 Nor must it be forgotten that much of the expansion of cultivation in coffee in the years from 1860 to 1880 was away from the Central Province, into Uva and Sabaragamuva where vast unbroken tracts of virgin forests (as in Haputale and the Wilderness of the Peak)10 in mountainous regions, with little or no population, were brought into cultivation. When the coffee industry collapsed in these areas, tea and cinchona took its place.
It was with rubber and coconut that a new trend emerged, the expansion of plantation agriculture into the low country, relatively more densely populated than the Kandyan areas, into the Kalutara district, the south-west and north-west littoral, and parts of the interior bordering on Sabaragamuva. If at the end of the nineteenth century the land-population ratio was becoming unfavourable in any part of the country, it was not in the Central Province and Uva but in the plantation districts of the low country. One must remember too that Sri Lanka’s population explosion is not a twentieth-century phenomenon. It had its beginnings in the middle of the nineteenth century. In 1824, the population was a mere 851,940; by 1911, it had reached 4,106,300. Undoubtedly the immigration of Indian labourers was one element in this increase, but the rate of natural increase was among the highest in Asia. This natural increase was greater in the low country than in the Kandyan areas. The increase by itself would have led to greater pressure on land resources, but these were generally adequate to absorb it without resort to any substantial movements of internal migration, Not that there was no internal migration: the plantations attracted not merely immigrant plantation workers from south India, but local people as well—traders, craftsmen, technicians of various sorts and carters to townships and market centres serving the plantations, not to mention others who came into newly opened plantation regions to secure a modest niche in traditional subsistence agriculture in the periphery of the plantations. In the Chilaw district in the late nineteenth century, the success of coconut cultivation led to a movement of population there and an internal migration took place away from Harispattuva, in the Central Province, to the adjacent district in the North-western Province with the opening up of land for coconut cultivation.
Thus the problems of land sales and population growth in the plantation districts are infinitely more complicated than the conventional views on these themes would have us believe. But much more research is necessary before we can come to firmer conclusions on these processes of social and economic change than the tentative ones outlined here.