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Page 2
THE CHANGING E
One aspect of Social life in Sri Lanka t last thirty five years is the people's attitu have seen the politicisation process gettir and peoples involvement grow Stronger. N while others have receded in importance aspirations have surfaced is mainly throu is only a surface interaction of the relati and the consciousness of voters. The me whole process both reflecting changing vo attitudes.
THE CEYLON DAILY NEWS. TUK
SECTION OF THE MAMMOTH CROWD that waited patien of votes went on insi
DALY NEWS, MONDAY. A
S S
: MR. S. MER. D. S. SENANAYAKE handsomme- karaajori ly garlanded yesterday after his re- C. Gita sounding victory in the Mirigama elec- annota
tion was announced
 
 
 

ECTION SCENE
at has changed completely over the COLOMBO MONDAY
h,
2 to politics. Eight general elections
more and more firmly embedded W Social groupings have formed nd the medium through which their h politics; even though this aspect strengths of these social groupings ia has played a crucial role in this ær aspirations and influencing voter
DAY SEFEMBER 9, 1947 إسعض
tly outside the Galle Courthouse while the counting i.e. on Sunday.
UGUST 25, 1947
PAET OF THE MAMMOTH, GATHER ING General's Office yesterday to hear the result North and Wellawatte-Gakasa elections.
THURSDAY AUGUST 28, 1947
(SS8-xx
W. R. D. BANEARANAIKE, who was elected with a handsome at Attanatala, shaking hands with the defeated candidate, Mr. usekera, at the Colombo Kachcheri yesterday after the result was ed. On the Beste is Mr. W. Coomaraswamy, Government Agent,
who was the Returning Officer.

Page 3
CONOMI RAVNAVAY
published by the People's Bank. Research Department, Head Office,
Sir Chittampalam A. Gardina Mavatha,
econo.2
Sri Lanka.
E EcoMoMo REVIEW is intended to promote knowledge of and inter est in the economy and economic development process by a many sided presentation of Vievs 3 reportage, facts and debate.
L S S S GGSS S K LSa C LLLLLaLLS Service project of the People's Bank.
L S S L LLLLLLSS LLS JJS S SSS S SSSS SSSL0aL LLS editorial considerations only and do not necessary refect Bank policies of the Official viewpoint. Signed feature Erices also are the persona ve VĀVES, 5 e autors and do not represent the
tt SLLSG L G LLSLL SS SLLSS S S SSS S LLLLLL Similar contributions as as LLL LLLLC LL L G JCS L S SSS S S S LYS G LLLLLtSS
S 00 SSS LSL S L S S aaSL L L monthly and is available both on
FO,
L. G.
A. L.
NEXT ISSUE
* A pos
* Expor facturi
* Openir
* The n
COVER ARTIS
G. P. wide e
 
 
 

Number 6 September 1982
CONTENTS
COLUMNS Diary of Events 2 July 1982 reign News Review 11 A country running out of reserves
-The downturn in Mexico's eCOηOIY1y
Commodities 12 Cinnamon market faces crunch
Finance 12 IMF Compensatory Financing
Industry 13 Successful trials on Sri Lanka's
- first solar dry kiln ܡ
The Economy 14 Emerging trends in the open
CCOηOIY1y
SPECIAL REPORT
3 THE PRESIDENTIAL POLLS
FEATURES
Jayawardena and 15 A study of the prices of drugs T. Atapattu purchased by the State Pharmace
uticals Corporation
asantha M. Perera 20 An electric light for every rural cottage in Sri Lanka-Aim of the Prashakthi Project
Ariya Abeysinghe 25 Minor irrigation in the agricultu
ral development of Sri Lanka
telection analysis of what the statistics reveal
t of apparel products from Sri Lanka, quotas and manuing potential
less and Inflation: the experience of Sri Lanka
nedical representative in a Third World country
Τ
Athulathmudali, whose speciality is art education, has Xperience in illustrating for publications

Page 4
July
DARY C
An agreement was signed with the International Fund for Agricultural Development (IFAD) for a loan of SDR 7.1 million (Rs. 160 million approximately) to be utilised in a coconut development project. The project which is to be carried out by the Coconut Development Authority consists of programmes to develop Small holder plantations and to provide extension services, research assistance,
and credit and marketing facilities.
An agreement was signed with the French authorities, for a loan of French francs 80 million (Rs. 273 million approximately). The proceeds of the loan Will be utilised to finance the Greater Colombo Telephone Exchange; Purchase of meteorological equipment for the Katunayake Airport; Ratmalana Railway Workshop, and Construction of an 80 MW Diesel Plant for the Ceylon Electricity Board. A One dollar per barrel price increase on Iranian crude oil came into effect. Iran currently supplies
about half of Sri Lanka's crude oil requirements at
US$ 30.55 per barrel. The CPC Chairman said that this increase Will cost Sri Lanka, about Rs. 100 million this year.
About 5000 enumerators began visiting the 1.8 mil
lion agricultural holdings in the country...to. Collect.
10
12
data, necessary for an agricultural census. The cost of living index figures (Colombo Consumer's Price Index) as computed by the Department of Census and Statistics for June 1982 was 416.3. The figure in June 1981 was 375.0 and June 1980 was 320.4.
A new Companies Act replacing the old 1938 law became operative with the Minister of Trade and Shipping signing the order. The new act contains many innovations like provition for offshore companies and people's companies and gives wide powers to the Registrar of Companies.
The Sri Lanka Aid Group meeting in Tokyo pledged US$ 668 million aid to Sri Lanka for the next year, the Finance Ministry announced in Colombo. Fourteen developed countries and three international Organisations attended the two day meeting.
The US will not sign the international Law of the Sea, treaty which has been under negotiation since 1974, President Reagan announced in Washington. He said that the portion of the treaty dealing with deep sea bed mining of minerals did not meet US objections. . . . . OPEC faced a crisis after the apparent collapse of an agreement to use output curbs to prop up prices in a Surplus balance World market, when a meeting of the 13 oil Ministers in Vienna, broke up after they failed to agree on demands by Iran and Libya for higher production quotas within an overall OPEC ceiling of 17.5 million barrels a day.
The Republic of Maldives became a member of the Commonwealth.
An agreement was signed with the Kuwait Fund for Economic Development, for a loan of Kuwaiti Dinars 12.9 million (Rs. 860 million approximately)

DF EVENTS
to help finance the cost of system C of the Mahaweli Development Project.
13 Finance Ministry sources stated that while the World Bank and the donor community had been generally complimentary of Sri Lanka's economic performance during 1977-82, at the recent Tokyo meeting of the aid consortium they had noted certain laxities creeping into the financial arrangement and control structure this year. Most donors believe that a more realistic exchange rate was absolutely essential. Attention was drawn to the increase in Sri Lanka's commercial borrowings and the government was alerted to keep a sharp check on this.
5 The People's Bank stopped accepting deposits subject to monthly payment of interest and fixed deposits for a period of over six months; and announced it would pay 13 per cent interest on six month deposits. Existing deposits, however, were to be serviced at the contracted rates until maturity.
19 A group of governmental experts of developing countries met in Geneva, to finalise the rules for the negotiation of a global system of trade preferences (GSTP) among developing countries.
... 20. The number of Americans living below the Government-designated poverty line climbed by 7.4 per cent to almost 32 million last year as a serious recession pushed unemployment to its highest level in over 40 years, the US Government announced.
22 The Stage II of the steel works of the Ceylon Steel Corporation - 'the Steel Melting and Continuous Casting Plant' - was declared open. This Plant is designed to produce steel billets using locally available scrap iron. The total cost of the project is estimated at Rs. 183 million, of which the foreign component is Rs. 64 million.
26 Israel's war in Lebanon has placed new strains on an economy already burdened with high military spending, and was undermining Government hopes of bringing inflation below the 100 percent mark. The Goverment says the conflict has cost over $ One billion, with a further $500 million needed to replace military equipment, stated reports from Tel Aviv.
27 , West, German EcOnOmiCS Minister Otto Lambsdorff said the US recession has not yet hit bottom and Warned that the World could face a depression unless the trend to protectionism is halted. Japanese rubber production, including synthetic rubber, fell 9.3 per cent in June to 83,465 tonnes - - - from a revised 92,050 a year earlier, but was up 8.6 percent from a revised 76.800 in May, Japan's International Trade and Industry Ministry stated.
29 With a view to encouraging investment in new buses by private omnibus operators, the Government announced an increase in the rate of depreciation allowance on purchases of new buses in computation of income tax. This enhanced rate of depreciation will be allowed, on investment in new buses carrying Over 15 passengerS, With retrospective effect from 1st April 1982 to 31st March 1983.
ECONOMIC REVIEW, SEPTEMBER 1982

Page 5
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滚
THE PRESIDENTIAL
Over eight million voters Sri Lanka, Will be entitled to cast their votes On October 20 to choose, for the first time, an Executive PreSident.
蜀
The system of voting at the forthcoming Presidential Election will also be a new experience for
them for, unlike at the past general elections, they will not only be able to vote for the candidate of their choice but indicate their second and third preferences as well. Where no candidate receives an absolute majority, the second and third preferences Will determine the Winner.
On polling day, the voter will be given a new type of ballot paper on which he is expected to mark, not the familiar cross (X), but the figure '1' in the space provided for the purpose on the right hand side Of the hallot paper opposite the symbol and the name of the candidate for whom he votes, as shown in the example bellOW.
A. Symbol
R Symbol
ECONOMIC REVIEW, SEPTEMBER 1982
s
However, while for any candidate,
more than three C: tion, he may Speci third preferences, figure “2' to indica ference and - the fij
cate his third pre
the symbol and th candidate. (The two are from the Presid No. 15 of 1981).
A.
B
C
Every ballot pa a list of the name. Sinhala, Tamil and ed as in their resp. papers, and arran in Sinhala in the ( names, Or where name, in the Order Qr Where there is name, in the Orde names. (See notice
According to
Symbol
Symbol
Symbol
Symbol
Elections Law, the
from 7 a.m. to 4 Commissioner Of IE
 
 
 
 
 

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casting his vote where there are andidates for elecfy his Second and by marking he te his second pregure “3’ to indi:ference Opposite le name Of the
examples given here ential Elections Ací,
2
3
per Will contain s of candidates in l English, describpective nomination ged alphabetically Drder of their surthere iS nO SurOf their ge nameS, nO SUITrname Or ge r Of their Other On page 4).
the Presidential poll will be taken p.m. unless the lections, by noti
fication în the gazette appoints any Other hour.
According to the Elections COmmissioner Mr. C. de Silva. the counting of votes will take place at 22 Kachcheries and the GOvernment Agent will be the Returning Officer, except in the case of the Mannar and Mullaitivu districts Which come under the Vanni electofa di Strict. The Government Agent of Vavuniya will cover those two districts as well, with the aSsistance of the respective Governis ment Agents of these two districts.
However, in the Colombo and Ganpaha districts the counting of votes will take place not in the Kachcheries but at Royal College, Colombo and the Pattalagedera, Teachers Training College, Gampaha. This Was because the kachCheries would not be able to cope with the large number of counting centres in the two districts.
There will be 165 counting centres throughout the island; one counting centre for each polling division which is co-terminus with 器 existing parliamentary electo
aeS.
To facilitate counting four of the parliamentary multi-member constituencies have been Split. ColOmbo Central has been divided int0 three polling divisions; while the old electOrates of Nuwara, Eliya-Maskeliya, Batticaloa, and Akurana have been each divided into two polling divisions, although the multi-membe constituency of Beruwela has Ot been divided aS the In UmberS ae more manageable.
Before the count is taken, the Elections Officer will verify the number of ballot papers in each ballot box. Once that is over, begins the proper stage of the count when the ballot papers will be SOrted according to the valid votes received by each candidate.
According to a schedule in the Presidential Elections Act No. 15 of 1981 a vote shall be cast by voting the figure '1' against the symbol and name of the candidate of first choice; while if there are more than three candidates for electi On SecOnd and third preferences are specified by marking the figure '2' and '3' opposite the symbol and names Of preferred candidates. At the end of the count the counting officer will prepare a written statement of the number of votes castin favour of each candiate, not taking into account the Second Or third preference in favour of any candidate, and will deliver the statement and the Sealed
3

Page 6
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Rte, aid the să cla cardiate as ss sec
uSYSzSY0YSLLLLzLLYELL0z S LGK YYYSESLS goamissieier of Electics.
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乏 Sir ginkR- Freeti zažiti 蘭
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-€e333 3. 5. &ios Lanka sana saja Patty -G)
yase Fra = R3 asi Iktara Niaya Sama satia ja, Party 蕴
స్టే .به : G, G. Rológia ax3nb3ł2.ra _ _ _ Ail Ceylĝin "ram!!! C8}}greSs ష్ట్ర3
33säassa *ijzweerg - Feople's i1ijera fiĝia Fraght چنانچے
packets of the votes to the Government Agent who is the Returning Officer for the district.
The Returning Officer will, from the statements furnished to him by all tine Counting Officers (including the Counting Officers at the counting centres where postal ballot papers Were Counted), add the number of votes cast in favour Of each candidate in that electOral district, and prepare a statement which he will transmit to the Comissioner of Elections in Colombo. The Commissioner of Elections will in turn, ascertain from the statements received froin all the electoral districts whether any candidate has received more than 50 per cent Of te valid votes ea,Sitt at the election Where a candidate has received Such 3.n absolute majority he will immediately declare such candidate electied to the office of President.
However, if no candiate has received an absolute majority, the Cormissioner will eliminate from the contest the candidates other than the candidates who had received the highest and second highest number of votes and direct trge Returning Officers to take (i.easures to count the second and third preferences of these two candidates.
The Returning Officer will ect the Counting Officers in respective districts to break and count only the packets which cOntain the votes cast in favour of the eliminated candidates. At the end of the count, they will Once HCre Þrepare a statement, this time Showing the Second and third preferences counted as votes in favour of the remaining two candidates in te conte:St.
李
dirtheir Open
The Return Ceipt of these s the preferences maining two cal inis electoral dis fresh statement to the Commis
The Commis Ceive Similar St. the electOral di SeCOndi and thi dicated in such See which of t Cardidates has fity of the veot Fyould forth Wii didate who has rity to be elect
President.
WÄ7héroe the i tĩẵỹG {33}ndidates he will determi and declare st Wins the lot as
Office of Presid
However, if didate at fire Who is entitled ted as President declaration, or laired elected as fore the conne Of office, the C. tions Will hold Election.
The Preside the System of is going to be not, Only for til torate but also Staff.
The Conn that it was the
Cឱsខ្មែ a 8 MANNER, Ol
he wot into the com Or any perso imark the ba directions giv Act . . . . . . . .
“The Wotte papers and on the right aa.ne of the
While cas
Where ti second and it second prefer opposite the And Wotegos
**Where ti ballot paper to any candi second and officer shal ground solely With the diri guidance of
Presidentia
 
 
 
 
 
 

ing Officer, on retatements, will add in favour of the redidates in respect of trict and prepare a which he will send sioner of Elections.
Si Oner Who Will reatements from all Stricts will add the di preferences as inStatements and he remaining tWO received the majOes. So counted and declare the canobtained such majOed to the Office Of
otes received by the is found to be equal he the winner by lot ch candidate who ಙ್ಗing elected to the 2nt.
the winning canPresidential poll to be declared elec, is dead before Such if a candidate dec| President dies beIncement of his term Dmmissioner of Eleca fresh Presidential
ntial Election and
preferential voting 2 a new experience he Sri Lankan elec
for al election
issioner has Stated duty Of the candi
s
allot - What the Act, Says
F WOTING
er, om receiving the ballot paper,
is directed by the presiding officer n acting under that officer's authority and there secretly
may be (en for the guidance of voters in the Third Schedule to this
partment to which he
lot paper as near as
2r, will go into the place reserved for the marking of ballot mark the figure '1' in the space provided for the purpose hand side of the ballot paper opposite the symbol and the candidate for whom he votes . . . . . .' sting his vote for any candidate, the voter may Lere are more than three candidates for election Specify his hird preferences, by marking the figure '2' to indicate his ence and the figure '3' to symbol and the name of the candidate ......
Intention he counting officer is
date or to specify
voters.
| Elections Act, No. 15 of 1981.
satisfied that any mark made on a clearly indicates the intention of the voter to give his vote if he has so desired his second or his third preferences in favour of any candidate, the counting not reject the ballot paper
that it has not been marked in all respects in accordance ections specified in the Third Schedule to this act for the
dates contesting the election to educate the voters on the new system of preferential voting. As for himself, he would be only carrying Out the Statutory provisions in the Presidential Elections Act such as putting up posters at the polling station S.
According to the Commissionsr, the Presidential Election will COSt the State about Rs. 55 million, which is Rs. 3 million less than the cost of a Parliamentary General ElectiOH.
Apart from the system of preferential voting, one of the features Which distinguished a Presidential Election from a Parliamentary General Election is that unlike in a Parliamentary Election when nominations are received by the GAS in the 22 districts, in a Presidential Election nominations were received by the Commissiner of Elections in Colombo. In a Parliamentary Election, the count is taken at the polling station or at the Kachcheri and the result which is declared by the government agent stands final. In a Presidential Election, the count does not give any final result and it is the Commissioner of Elections who declares the result. In a Parliamentary Election under the system of Proportional Representation, ballot papers will have only the names of the parties or the numbers allotted to the independent groups and their symbols whereas in the case of the Presidential Election the ballot papers will have the names and Symbols of the candidates.
shall forthwith proceed
in accordance with the
indicate his third preference
under SubSection (1) On the
ECONOAAEC REVIEW, SEPTEMBER 1982

Page 7
The Second Republican Constitut
The 1978 Constitution WhOSe de Claire di Objective is to establish a "Democratic Socialist Republic of Sri Lanka', is a deviation from all Prê:ViOUS COINstitutions in Sri Lanka, in that it attempts to straddle both YL S S SLLKL0LJY SLLLLLLL0SS00LL0L S S LLLLLLLLLS 10CeS Öf G_W erhinellt.
Corring as it did in the wake of the Fir St. Republican COInstitution drafted in 1972, it is sometimes also ieieted to as the SECON di Repub
i63i2 CG}} Stitution. The Executive President
Oile of the chief features Of the 1978 Constitution is that it provides, for the first time, for as Executive Preside at who is the Head of State, Head of the Executive and of GOVearnet and Commander-in-Chief of the Armed Force. He is elected by the people and holds office for a term of six years.
Though the present incumbent of the GSt President Jayewardene was not elected by the people to this highest executive office, he holds this post by virtue of Article 160 of the Constitution which declareS;
“Notwithstanding anything to the contrary in any other provision of the Constitution, the person holding the office of President immediately before the commencement of the Constitution shall be the first
President under the Constitution. and shall be de ened for all proses to have been elected
as the President of the Republic and Sinal hold office for a period of six years from February 4, 1978'.
Therefore, while President Jayewardeine is by virtue of this constititti Oħra provision, the de facto 'elected' President, the candidate who is elected as the President at the forthcorning Presidential polls will dig irre be the first elected President.
YLYS S S SK eLe L0LeL0mSLLLL0SLLLlll LLLLL S SLLtlL L S LaccLL constitution) is not a member of Earliary eat. 寰é 盘窦。雀] fiյ:1ցtiց: through a Cabinet which, unlike in
America, is chosen from the legisla
ture which is the supreme legislative body. The President cannot paSS laws, repeal laws or amend laws. NOr can he send back laws to Parliament,
as the American President can, for reconsideration. . -
However constitutional exnerts
have noted that the amended Article 5 (3) and Article 92 (3) could pose serious conceptual problems. Article 5 (3) emphasises that the President shall be the repository of executive power, implying that the Cabinet and other executive functionaries would be subordinate to the President and act in an advi
sory capacity. On the other hand, Article 92 charges the Cabinet of Ministers (of which the President
Ecoronic REVEw, SEPTEMBER 1982
k vythic
is tine Headi) w 3 n.C. COnt Ol Of the in plying that the mus inter pares (f in a collegia dieci which is collective anSWerage to Pari: Ginte di Oit (for e Tiruchelvam) that all arabiguity as t St.V.7Get the Presic het Of Ministers - tant implicati OinS : railer in which to be exercised.
One of the in tiže Presidential Sy in the Second Repu is that the ffision Coi O State and of th ernment in a Sing in the wrong haj
II. However, X&Y foi argie that ar fÍirtister could hav PG Wei AS 3 *
Gf. Pig yw er ef Disseteg$i There are how differenti President in der th Caill Colin Stitution i Ř/firmister of the CGístituition. Fii:S af di SS-Olütigi Of EPrime Minister is řf the di SSgtigi geïnt is uYat Calched
rocess which he the President may inisterial Sibiect and exercise statu ikke i te geS Minister, such now sin3} En Ott, higie subje vievky, *g'eşiği eğitial Advise The 1978 Cans ợifs fyra Presiden: gg}} gg ថ្មីឆ្នា talent, in the cour gif advisers could
G : gke decision S politically expedieu beneficial to the cit 蟹堡。 The syster advisers fe 2: S been as being “a gover government', out t SUCN 3. Sy Stern argo Prime Minister une Stiftions had an i advisers and that
er to formalise St adviSeTS, WO W FOU i??o ?e visi *ole and : only shortcoming i. is that, tere Yoe in as the requirement Select, Committees accountability. Minority Parliamen
The Executive the Second Republi
 

on (1978)
th the direction Government, thus President is priest among equals) ion-making body r responsible and ment. It has been ample by Neelam this could create the relationshigi ent and the Cabiwhich has imporor the style and }xecutive power is.
jor criticisms of stem 38 en visaged. olican COnstitutiOri. power of the Head e Head of GOve individual could ids lead to desthere are others. 'Imperial’ Primes e yielded as much Imperial' Presi
}፻፬ ever, two features:
ate the Executive
e Second Republirom the Prime First Republican lly, in the pOWIer Parliament the inevitably a victim. While the Presi
by the dissolution.
initiates. Secnndly. assign to himself is and functions ttÖ?y gOWeil's e of the Prime vers and functions ct to iudicial re
ES
titution also O'O- tial advisers who from the highest itry. Such a team,
help the President
which may not be nt but could be puntry in the long in of Presidential criticised by some Inment viithin a, hoge Who Support tle that even the der Brevious CONinvisible coterie of it would be betach a system of d now become accountable. The in such a systern o safeguards such to appear before to enhance their
tary Support
President can Constitution
but,
under =
also runs the risk of facing a hostle majority in Parliament which could Sesilt in a deadlock between the executive and the legislature. (See Section on President Vs Parliaget'. Eisigoval of President
The President may be removed from office by a resolution of Parliainent alleging that the President is permaneratiy incapa kole of di Scharging the functions of his office by reason of mental or physical infirmity or that he has been guilty of either international violation of the Constitution, treason, bribery, misconduct or corruption involving
the abuse of the powers of his office
or any offence under the law, inwolving moral turpitude." Upon the resolution being passed by a twothirds maiority of the House, the Speaker shall refer the allegation. Or allegations contained in such ceSOution to the Supreme Court for inquiry and report. Where thể
Supreme Court holds that the Presi
dent is not fit to hold Office, the verdicit, of the Court has to be end Orsed by a two thirds majority of Parliainent voting in favour of the remowill of the President from Office.
The Office of President could also
fall vacant either due to death, re
signation, or if the President ceases to be a citizen or fails to assume Of fice within One month. Presidential Election
The Third Amendment to the Constitution, approved by Parliament on Agust 26 this year empow - Eers an in Calent President to call for a presidential election after corapleting four years of his six-year tern to exile in to seek a mandate from the people for a fresh ίθίγγη.
Upon the proclamation made by the incumbent President declaring his intention of seeking reelection, the Commissioner of Elections is required under the amend
ment to take a poll for the election
of the President.
The an encient, has been criticised as restricting the franchise of to people in that it, enables an inCUkjent President to ChO, OS e the tiri e of his own election. The Suorerae Court, lowever, which heard four writs filed by the Civil Rights Moyerient, and Certain individualS ruled that the new amendment did nok affect the franchise or Sovereignty of the people and therefore did not require the approval of the people at a referendum. The Court held that "by reducing the irreducible period of the President's Office from six to four years, the President would be enabled to discover
the will of the people and the peo
ple will be given an opportunity to express their approval or disapprovall of his stewardship or his progranme of action prior to the expiration of the full period of six years.
5

Page 8
&
Sailo Boxes Brought in for the Ceará - 5
The Prime Minister
It has been argued that the Second Republican Constitution has reduced the Prie Afinister t0 a ne’e figure-head. While it nas to be conCeded that the powers of the Prime Minister have somewhat diminished under the present constitution, sone also point out that he still iS a in important persOnage in the political system. He is second-inconnaiad to the Executive President and it is he who feels the pulse of Earliament. It is he who arranges the business of Parliament and also tra Kisa Cits på siness With the group in the Opposition. He takes part in debates that deal with national questions, He answers questions On government gUlicy.
While the Prime Minister is in a sense the First Minister of the President, he may also be removed by the President the same way as the forme : French President GiSCard d'Estaing removed his Prime Minister Jacques Chirac, while the President hiain:self could keep his majority in Parliarinent intact. However, One would expect the President to work together with the Prime Minister if the Systen is to Work mean?-- ing fully. Prentational Representation
The CC institution also departs from previous Constitutions in that the people will vote not for individuals but for political parties that seek their support. This system of Proportional Representation g'O- vides for the election of candidātes in proportion to the number of votes cast for such arties. (See Section on
Proportional Representation') ബ The Judiciary
The Second Republican Constitution also seeks to guarantee the independence of the judiciary. The number of judges appointed by the President to the Supreme Court has been fixed at ten. A government cannot therefore appoint more iudges who are well disposed towards it, except by amending the constitution.
6
The Supreme C decide on the Of legislation, a Bill on the Thi Constitution, bi legislation is at If the Supreme proposed legisla Constitution, System governn enjoy a two thi be able tO anne Orly With the C position.
Finadamental ) Foukhdament; ed as being an SOvereignty of for the first t ticiable. The 19 rantees six ty rights, namely of thought, co. Article 10), th, ture { Article 1 lity (Article 12 trary arrest, d ment and prol penal legislatic dom of Speech tion, occupat (Article 14), a tional remedies The frame tion haye Se) freedom of the religion (Artici Om from t Ort entre{achment, while the othe to the Sal Policy,
There has criticism that effect to the Policy, is too w praetical valu fundialental o One of the present Const abies the peop ferendum, to sion-making p 33, 33 th 3
 

77
ourt is empowered to 2Onstitutional validity is in the case of the rd Amendment to the ut only before such lopted by Parliament.
Court rules that the tion is ultra wires the Since under the PR. ents are not likely to rds majority, they will indi, the COinStituti Oil
O-Operation of the Op
Rights
all rights are regardintegral part of the the people and have ime, been made jus178 Constitution guaDes of fundamental the right to freedom Science and religion e freedom fL'Orin tOir1), freedom of equa), freedom from arbi
etention and punish
hibition of retroactive bin (Article 13), freeassembly, associaion and movement rad right to constitu
(Article 17).
rs of the Constituected the right to ught, conscience and e 10) and the freeiure (Article; 11 N for in the Constitution o freedoins are subiect equirement of State
hOWever been SOne the restriction giving principles of State ide to confer sufficient to the exercise of ghtS.
novel features of the tution is that it enle, by means of a Rearticipate în the decirocess of government ing of laws. Certain
z te'S Such as the exteH2SiOn Of thíE life of Parliament or exteinsion of the term of President require, in addition to a two thids maiority of Parliarinent, the direct approval of the people at a referend U2. Fartiner, the President is em powered to cal for a Referendum to seek the yerdict of the people on any ouestion which he thinks is Of Eational İİİ.ğOrtance. The Public Service Commission
A Public Service Commission is Once more established, although the Cabinet of Ministers retains considerable power in regard to the agFoi atment, transfer, disciplinary control and dismissal of public officers. fra disina
For the first time, provision has
been made in the Constitution for
a Parliamentary Commissioner of Administration, known as the Onbudsman, who is charged with the duty of investigating and reporting on complaints of violation of fundamental rights and other injustices committed by the officers of the public and local administration. Critics, while welcoming the principle of having an Ombudsman, have charged that the exclusion of Ministers, Deputy Ministers and Members of Parliament from conting under the purview of the Ombudsman would detract from the value of this new institution. They also point out that there are not Suficient constitutional guarantees to safeguard the independence of the
ice of the Onoldsman. Casultative Cennittees
The Constitution also provides for the creation Cf COnSultative Committees of Parliament whose obiective is to obtain the effective participation of the different strands of political power represented in Parliament.
Religion, Language and Citizenship
The Second Republic Constitution has retained the “foremost place' accorded to Buddhism in the 1972 Constitution. Sinhala is recognised as the Official language While "Famil has beetl accorded the status of national language.
The present Constitution has also done away with the distinction between citizens by descent, and citizens by registratici and provides for only One class of citiZeS.
As a people, Sri Lanka are cornparatively new to the Republican experience and therefore it is still too early to say what impact the Second Republican Constitution of
1978 would have on the country.
Presides at WS Parliament -
The President of the Second Republic serves a term of six years and so does Parliament which is also elected for six years. However, when there is a time gap between the election of a new President and the election of a new
EconoMIC REVIEW, SEFTEMBER 1982

Page 9
Parliament, there could arise a crisis goint in the Constitution when a President who is still in office is confronted by a majority in Parlia
ment, which belongs to a different coimplexSion.
One of the options to the
President under the constitution, is to dissolve Parliament before its sixyear terms ends. If he is again faced with a hostile majority in ParliaHeint he cuid then try the secOnd option Open to him of using the constitution to dissolve Parliament a second time, which however, he can do only on 3 year after the previous general elections.
As pointed Out by some CO1)- stitutional experts, restricting the option to a period of One year after a general election could result in the President being 鑫一 fronted during the year with a deadlock and perverse Parliament, which can refuse to pass the statement of Government Policy. Parliament could also sanction the annual budget, with its own amendments, not acceptable to the President, and his members in f}{i}. Ce.
The President may dissolve Par
iiament, before the constitutional limitation of One year ends if Parliament rejects the Annual Appropriation. Bill within that year.
Some constitutional lawyers believe that Parliament, rather than risk dissolution, will amend and inangle the Annual Appropriation
Bill in a way totally unacceptable
to a government without actually rejecting the Bill. In such a situation, they point out, a newly for Ined government, which does not have a majority in Parliament will given the workings of the new system of proportional representation, have to be at the mercy of the Opposition or make way for another govegiment more unstable than itself.
If one is to go by past election results and opposition seats by the :5op:};lia is votes - as is generally the intention of the new amendments it is seen that apart from the two cases of 1956 and 1977 it would have been unlikely for any single party to dominate Parliament in the past legislature. The historical experience then that we have to go by would lead us to the view that if FR had existed in the past it would have led to a high degree of unstability with frequent conflicts between legislature and the execitive presidency.
Apparently, it was in anticipation of such a dilemma that the Government recently sought to bring in an amendment to the Constituition which would enable the President to dissolve Parliament, twice within a period of one year.
However, if the same situation is reproduced, even after Such ar. arriendment, the President would have to rule with whatever majority that, emerges.
ECOMoMτο REVIEW, SEPTEMBER 1982
31). Stičih ali ev ielt, äFic ist S . SW majority will have t power as provided i. of the Second Repu new majority in Pal whening one of two arise. Re Preside. with whatever maj 62 i geS, in the event could be a shift of President to the Pri. ternatively, the P. revert to the positi tutti Ormal figure-head "Hiie EPE System
○選ye Of the 1ew pesent Constitution Proportional Repres has replaced the old Systein of electing r territoria: Constituder: Under the PR is tiict, is tile constitu. the case of the ad tricts of Mannar, Wa laitivu, which have it, form the Vanni trict, for Parliamnet pect of district dev cils they have bee. three separate dist
The System of P resentation operates iferent levels, for el Government bodies Councils and Parliar a di Opted for Ocal g tions in 1977 and ag Levelopment Council
98.
Each political of independents see the elections is red Sent a list of ca. to the number of s each district. The have an additional II of persons who woul of a member who chooses to resign hi. party Or dies.
The systern of P resentation is desig better reflection C than was possible Westminster system, significant trend of ni G is reflected in
One of the criti constituency Syste pia Oduced rather pec the 1977 general ele ample, the United (UNP) gained 50.9 VOte:S blit ootained the seats in Parliam systern been in for have been more e between seats and VC have obtained only of the seats.
It has been sa the advantages of is that political par of independents wou in Parliament in r to the support the
 
 

eit tie PresiParliamentary G 1ealen t0 Sha) te tine Coinstitution blic; but if the ilianilet is Oversituations could it, COUlid rule brity that emof which there power from the nine Minister. Al'esident couldon of a coasti
of State.
features of the is the system of entation which first-past-pOst members through cies, ystem, the disency, except in ninistrative disvuniya and Mulbeen COmbined electoral dis; though in reselopment cOuinconsidered as icts. roporti Gna Repat three diiections to Local Development ment. It was first gOvernment ele Cgain for District elections in
party or groups king to contest Juired to preEdidates equal eats assigned to list would also Unaber of names di take the place s elected but S. Seat, leaves his
rOGortional Reled to enable a if the electorate nder the Old so that every political opithe legislature. cisms of the Old in was that it Liliar results. At !ctions, for exNational Party per Ceat Of the 83.3 percent of ent. Had the PR, e there would Cual proportions ptes and it would 57.1 per cent
id that one of the PR system. ties and groups ld obtain seats pugh proportion enjoy in the
eiectorate.
The creators Of the 1978 Constitution also point Out that under tine new system; there is a greater Cina. Elace of rilaintaining stable governneit over a reasonable length of time because MPs who choose to leave their party will face the prospect of losing their seats in Parliament and their positions can be replaced by their political parties.
Critics, however, say that under the New systen MPS Would Cea. Se to have the intiminate contact they used to have with their conStittentS under the former electOra, te systern and Would become the Orisoners of their respective political arties, and consequently the party machine could become all powerful. Proponents of the PR system beļjevy e that the del C2Co3tiC prGCeSS would check the power of the party leadership. They also point out that, unlike in the past when MPS wasted their time attending minor grievances of voters they Would nowy dewote their attentiOn t0 wider issues of development.
One of the major criticisms of the system is that Article 59 (5) would eliminate political parties and independent groups that fail to get at least 12; percent of the votes polled. This, critics maintain, would defeat one of the main objectives of the PR system which is to enable every significant political opinion to be represented in the legislature. It has been pointed out that if in a number of constituencies a party obtains less than the required 123 percent of the votes, a considerable number of votes would be wasted and in effect, such votes would be disenfranchised. The proponents of the present constitution argue on the other hand that the cut-off point could help the growth of a two party system and prevent the emergence of a legislature where a multiplicity of parties 2Ould hinder its effective functioning.
The provision for a "bonus seat for the list that, gets the highest Eumber of votes in a particular elecf;};}"ERte h2S als C. been criticised a S heig disadvantageous to small paties, (for example, regional parties and those of the left). There is 2. possibility of large parties getting several bonus seats throughout the country which are not backed by votes. But those who strongly support the PR system argue that the bonus seat would help to stabilise the party that has been elected by the majority.
Critics of the PR system 线蟹é also not happy that the new system has done away with by-elections which were traditionally considered a barometer for measuring public opinion between elections, while others believe that by-elections do not in any case reflect the true state of public opinion and only result in destabilising the political system.
7

Page 10
What the Statistics Reveal
tables the
The Statistics in these show clearly the growth in
entire electoral process and its various features. One i clear indication is the increasing number
of electoral districts and polling stations that have been required with each successive general election. As seen in table 1 both the number of polling districts and the number of polling stations have had to be more than doubled bet
Ween 1956 a.C.
had noved up if ab OUit 2,350 in 1 in 1977 and tod gion of about 6
An aven stro the cost to the ing the eiecisions ann Olunted to ab lion, while in 19 R.S. 21.5 milion.
NCREASE IN POLLING DSTRECTS AND POLLENG
GENERAL ELECTIONS, 1956-1977
Table
Number of Date Electoral Electorate
Districts
1956 - 89 3,464, 159
March, 1960 星45 3,724,507
July, 1960 量45 3,724,507
1965 45 4,710,887*
1970 45 5,505,028
1977 60 6,667,589
|982*** 8,145,015
Number of Number of
Polling Polling Stati
Disí Frict S
2,258 2.43
(Incluedes 1
Polling Stati
3,532 3,655
(Includes 12
Polling Stati
3,532 3,664
(Includes 13
Polling Stati
4,647* 4,771
(Includes 14
Poling Stati
5,485* 5,613
(includes 15 Polling Stati 6,033 6,280
(Includes 24 Polling Stati 6,621
* Including the two member Electoral District of Colombo South, (C.
returned incontested.
** Excluding the two-member Electoral District of Colombo Sout
* Including the Eelctoral District of Welimada, candidate for which y
** Excluding the Electoral District of Weimada.
** Provisional
Source: Coin, missioner of Elections, Report of the General Election of 2
°FKCENTAGE DF VO''ES POLLED AND VOTES R
GENERAL ELECTIONS, 1947-1977
Table 2
ο Υράγμα
Electorate
1947 3,048,145 1952 2,990,912 1956 3,464, 159 March 1960 3,724,507 July 1960 3,724,507
1965 a. 4,710,887 - 1970 5,505,028 1977 6,667,589
Turn out of Peycé} Voters at Polls of Tur
1,701,150 5 2,114,615 7 2,391,538 6 2,889,282 7 2,827,075 - 3,821,918* 8. 4,672,656** : 8 5,780.283 s
* Two-Member Electoral District of Colombo South was unconte
* Electoral District of Welimada was uncontested.
 

1977. The numbers On an average Of 956 to about 6,150 ay are in the re
inger indicator is State for conduct
which in 1970 Out Rs. 8.5 mil77 it was close to At this stage the
STATTHONS
Average No. of voters per
Offs Polling
Stafio
. . 1,424
75 female ons)
1,018
7 female ons) ! 1,017
2 female ons) 率率 975**
7 female ons)
977**
4 female ons)
1,062
7 female ons)
1,230
andidates for which were
h.
as returned uncontested.
l, July 1977,
E.F.CTED
tage Percentage of 2 out Votes Rejected
5. 2.1
0.7 1.34
9.0. 95
7.6 89.
5.9 .63
2.1 75 5.2 53 6.7 53
fed.
Presidential Election is estimated to cost Rs. 55 million and a general election Rs 58 million. These costs to the State per elector have been estimated at -/76 cts in 1956 in 1960 (March) at Rs. 1/07; in 1965 at R.S. 1/2i; in 1970 at Rs. 1/53; and at nearly Rs. 3/ - in 1977. Today's cost
W Guld be cloSet tO RS. 7 / ---- »er voter.
The turnout of voters at the
polis has also been steadily 鳢一 creasing with each general election, while the electorate has grown from around 3 million in 1947 to 6.7 00 LL0Ya a S SSS S S000S0S LS S00S0S G tLLLLt00 S L00S day. There has been a tendency for the ilirnout, at the polls to show a steady increase with almost all general elecáiig Ins. T]The percentage turno Ut in 1947 was 55.8 percent; by 1965 it had reached 82.1 percent and in the general election of 1977 it was 86.7 percent. Another significant factor seen in table 2 is that the percentage of rejected votes has also come down with each general election upto 1970. It was as high as 2.1 percent in the first general elections, but came down to .75 percent in 1965 a.3ad to .53 percent in 1970. and 1977.
The heavy turnout of voters in Sri Lanka's general elections has been regarded as a stroing reflection Of the political consciousness of its people, built up over five decades of exercising the right to the franChise. As seen in table 6 one Of the only other countries having a similar type of universal franchise, and where voter participation was higher, was W; est Germany which reached a voter participation of 90 pgrgent in 1972 and 1976 and 818 percent in 1980. Countries such as USA, Japan, France and the United Kingdom had a lower participation rate than that of Sri Lanka.
Table 5 gives an indication of nu aerous shades of political parties that have been represented in the Country over the last 3 decades. As many as 9 different parties have been represeited during this period. The trend however, as indicated in Our earlier issues on elections was the popular vote of particular parties (the total number of votes re
ceived by all candidates fielded by
each of these parties) has gradually been concentrated in 2 or 3 major. political parties. In the three General Elections of the decade between
ECONOMIC REVIEW, SEPTEMBER 1982.

Page 11
Table 3 VOTING STRENGTH BY DISTRICT -1970, 1977 AND (NUMBER OF WOTERS-DISTRICT PERCENTAGE FOR SPEC
1970 1977
No. % · N/0. %
1. Colombo 706110 12.8 82.5908 12.4 2. Gampaha 591.266 10.7 705363 10.6 3. - Kurunegala 4852O6 8.8 588246 8.8 4. Kandy 3961.64 7.2 475,171 7.1 5. Galle 387974 7.1 443143 6.7 6. Kalutara 373435 6.8 432854 6.5 7. Jaffna - - - 362358 6.6 408261 6.1 8. Kegalle ... - - - 295533 5.4 349333 5.2 9. Ratnapura - e. 25.8861 4.7 325537 4.9 10. Matara ... a - 289846 5.3 341417 5.1 11. Badulla 176747 3.2 217260 3.3 12. Anuradhapura 150314. 2.3 200319 3.0 13. Puttalam 154060 2.8 215405 3.2 14. Hambantota 143712 2.6 187557 2.8 15. Digamadulla 124722 2.3 154831 2.3 16. Nuwara Eliya 1294.67 2.4 158920 2.5 17. Matale 113282 2.1. 148244 2.2 18. Batticalioa ... 1071,86 2.0 13294.3 2.0 19. Trincomalee es 792.61 1.5 974.17 1.5 20. Polonna ruwa 620.3 1.1 88.68 13 21. Moneragala 60070 11 86.104 1.3 22. Wąhni - 57091 1.0 84.915 3.
5505028 100 6667589 100
Based on Department of Elections data
Table 4 VOTING STRENGTH BY DESTRICT-1970, 1977 Al (NUMBER OF WOTERS AND PERCENTAGE INCREASE PE
1970 1977 %, Increase 1981 %. 1 1977. Over 1981 1970 19
1. Colombo 706110 82.5908 17.1 9721.90 1. 2. Gampaha ... 591.266 705363 19.3 835265 1 3. Kurunegala 485206 588246 21.2 71 7505 2 4. Kandy 3961.64 475,171 19.9 564767 1. 5. Galle 387974. 443143 4.2 52489 6. Kalutara - 373435 432854. 15.9 4992.15 1. 7. Jaffna 362358 408261 12.7 493705 2 8. Kegalle 295533 349333 18.2 406548 9. Ratnapura ... 25.8861. 325537 25.8 4022.02 2 10. Matara 289846 34.1417 17.8 399808 1. 11. Badulia 176747 217260 22.9 2801.87 2 12. Anuradhapura 150314 200319 33.3 278594 3 13. Puttalam 154060 215405 39.8 267675 2 14. Hambantota 143712 187557 30.5 24-1956 2 15. Digamadulla 124722 154831 24.1 204268 3 16. Nuwara Eliya 1294.67 158920 22.8 201878 2 17. Matale 113282. 148244. 30.9 87276 2 18. Batticalloa = ... 107.186 132943 29.0 173480 3 19. Trincomalee ... 79261 974.17 22.4 133646 3 20. Polonnaruwa 62003 88168 42.2 127624 4. 21. Moneragala ... 60070 86.104. 43.3 126558 4 22. Wanni 57091 84.915 48.7 119093 4.
5505028 6667589 21.1 81.4505 2.
Based on Department of Elections data.
Figures in the above two tables are based according to electorates located it districts. Where such electorates were placed in larger electoral districts are rearranged here on the basis of the 1981 position.
ECONOMIC REVIEW, SEPTEMBER 1982

1981 DIFIC YEARS)
Í
O
8
No.
9721.96 835265 71 7505 564767 512489 4992.15 4.93705 406548 4C2202 399808 26O187 278594 267675 24-1956 204268 201878 187276 17348O 133646 127624 126558 19093
8重45015
%
|
---1.
O
o
ND 1981 ER DISTRICT)
increase %, Increase | Over 1981. Over )77 1970
37.7 41.3 47.9 42.6 32.1 33.7 36.3 37.6 554. 37.9 58.5 85.3 73.8 68.4 63.8 55.9 65.3 61.9 67.9 105.8 110.7 108.6
48.1
--
2
2
---
the 1981 electoral in 1970 or 1977 they
1960 and 1970 the UNEP and SILFTP together collected 68%-7.5% of the popular votes, while in 1977 these two parties together had over 80 percent of the votes. From July 1960 the votes of the two parties have increased as follows.
SILᎬᎬ UNP
1960 0 inn. 1.1 min
1965 1.2 , 1.6 ,
1970 1.8 , 1.8 ,
1977 1.9 , 3.2 ,
There has been a steady trend upto 1970 which was not continued With the 1977 results. The greater concentration of votes in a single party in the North and Eastern ProVince Was als) a feature in the 1977 election 2.S indicated in table 5. Ünder the then Scheme Of parliamentary elections in Sri Lanka, obtaining a majority of Seats by a party in the National State Assembly did not necessarily imply that a majority of voters backed that parti
cular party.
Tables 3 and 4 show the
increasing strength of the electorate by district. What is significant in theSe tableS i S that the di StrictS SUch. as Moneragala, the Wanni and Polonnaruwa have increased their voting strangth by over 100 percent betWeen 1970 and 1977: WhereaS di Stricts such as Colombo, Galle, Kalutara, Jaffna, Kegalle and Matara have recorded an increase of only 3238% during this same period. The following 10 districts have shown an increase of over 60 percent in their electoral strengths during the 10 years since 1970: Moneragala, Wanni, Polonnaruwa, Anuradhapura, Puttalam, Hambantota, Trincomalee, Matale, Digamadulla and Batti
CaOa.
Furthermore, these 10 di Stricts which had only 18.8% of the total voting strength of the country in 1977 today contain. 22.9% of the total electorate. The additional 4 percent gained by these districts over the ten year period amounts to almost 800,000 more votes in these
area.S.
9

Page 12
Table 5 ANALYSIS OF RESULTS OF ELECTIONS-BY
配翡配套雪邦 ܝ ܢܝ .
VOTES CAS j” pÉRCEAITAG : Year of Electors & Ilirn oilt General Parliamen- of voters & Election tary Seats percentage T.C. CVC CP FP
1956 3,464, 159 2,391,538 8,914 -142,758 119,715 -سس 95 69.0 0.3 - 4.5 5.4 1 - 3 O 1960 3,724,507 2,889,282 38,275 - 147,612 176.444 March 151 77.6 1.2 - 4.8 5.7 1 - 3. 15 1960 3,724,507 2,827,075 2,300 - 90,219 213,733 July 151 75.9 0.1 - 3.0 7.0
- - 4. 16 1965 4,710,887 3,821,918 98,746 - 109,754 217,914 151 82.1 2.4 - 2.7 5.4 14 .4 ہے۔ --3 1970 5,505,028 4,672,656 115,567 - 169,109 245,727 151 85.2 2.3 - 3.4 4.9 13 6 - 3 ܓ 1977 6,667,589 5,780.283 - 62,707 123,856 22,443
168 86.7 - 1.0 2.0 0.4
- 1- -
TC-All Ceylon Tamil Congress; CP-Communist Party of Sri Lai CWC-Ceylon Workers Congress (Political Wing); FP-iilankan United Liceration Front; UNP-United National Party.
* Jatika Vimukthi Peramuna and Lanka Prajathanthravadi H ** Two-Member Electoral District of Colombo South was unco
Electoral District of Wellimada was uncontested. : includes votes cast for some minor and small parties recogn (Act. No. 11 of 1959) governing the recognition of political parties ( S (Includes 2 members elected from minor parties 1956 Elect (Includes members elected from minor parties March 1965 Ele
Table 6 COMPARATIVE STATEMENT OF VCTER PARTC UNITED KING DOMI, FRANCE ,WESTERN GERMA
SR UNITED ELANKA INDIA KENGOM* F General Turn General Turn General TuFF Gent Election Out Election Out Election Out Elle
%, % %
1947 55.8 1952 46.99 1950 83.9 195 1952 70.7 1957 47.84 1951 82.6 195 1956 6》。G 1962 55.75 1955 76.8 195 1960 77.6 1967 6量。33 1959 78.7 19 (March) 1960 75.9 1971 55.29 1964 77.1 19 (July) 1965 82。彗 1977 60.54 1966 75.8 196 1970 852 1970 72.O. 19. 1977 86.7 1980 36.80.1974 78.8
)February( ܗ
974 72.8 197 (October)
1979 76.0
Source: * Secretariat of Election Commission of India.
* The International Almanac of Electoral History by " * “British Electoral Facts 1885-1975' by F. W. S. Craig
Parliamentary Research Services, Chichester, West Si
Source: Commissioner of Elections, Report of the General Elections
10
 

POLITICAL PARTES AND INDEPENDENTS-GENERAL ONS = 1956-1977
OBTAIN E AND SEA S FY ON BY PART | ES AND INDEPENDENTS
Offier
Minor Indepen
LSSP MEP SLFP TULF UNP Parfieș* dents
274,204 1,046,277 - - 738,810 - 316.5é9集 10.4 39.5 - - 27.9 - 12.0 14. 51. - - 8 - 8 325,286 324,332 647, 175 --- 909.043 146.339 379.490ま 10.5 10.5 20.9 - 29.4 4.7 12.3 10 O 46 -- 50 6 10S 224,995 106,816 1,002,171 ---- - - - 1194,895 44,237 166 ,144 و 7.4 3.5 33.6 - 37.6 1.4 6.4 12 3 76 - 30 4. 7 302,095* 96,665 1,221,437 259,960 149,220___ ** 1,590,929____ ہے۔ 75*料 2.4 30.2 - 39.3** 3.7 6.4 重0李举 1. 41 - 66** 6 6 433,224 46,571 1,839,979* - 1,892,525 - 249,006 8.7 0.9 36.9-- - - -5.0 - 37.9 م 19 - 91- 2 - 17 ܚ ܚܚ 225,317 22,639 1,855,331 349,943 3,179,221 - 353.014 3.6 0.4 29.7 6.4 50.9 5.6 - - 8 28 量4○ - i
ka; LSSF-Lanka Sama Samaja Party; SLFP-Sri Lanka Freedom Party; Tamil Arasu Kadchi; MAEP— Mahajana Eksath Peramuria; TULF-Tamil
akshaya. htested-1 of the LSSP and 1 of the UNP were returned.
ised under section 2A and 36 (IA) of the previous provisions of the Law, Details appeared in Table VI Sessional Paper XX of 1966).
R} (Details appeared in Table VI of Sessional Paper XX 1966)
DIPATION IN GENERAL ELECTIONS IN SRI LANKA, INDIA, NY, JAPAN AND PRESIDENTIAL ELECTIONS IN THE U.S.A.
WESTERN RANCE* GERMAFANY* JAPAN* U.S.A. 2ral Turn General Turn General Turn Presidential Turn ction Olut Election. Of Election Out Election Out
% % % %
78.0 1949 76.O 1949 72.7 1948 51.1 爵 79.7 1953 83.0 1952 75.6 1952 61.6 8 74.7 1957 84.5 953 73.5 1956 59.3 66.6 1961 84.3 1955 75.2 1960 62.8
莒 79.量 1965 84.7 1958 76.4 1964 61.9
韶 78.6 1969 85.2 1960 72.7 1968 60.9 '3 79.4 1972 90.4 1963 704 1972 55.7 1976 89.9 1967 73.0 1976 54.4
9 62.7 1980 87.8 1969 67.8 1980 54.0
1972 707
1976 73.5
1979 68.0
fhomas T. Mackie and Richard Rose (Macmillan Press Ltd. London 1974). Macmillan Press Ltd., London, 1976) and Information supplied by Issex, England, through the courtesy of Mr. W. S. Craig.
pf 21, July, 1977. and Keesing's Contemporary Archives.
ECONOMIC REVIEW, SEPTEMBER 1982

Page 13
A country running out of reserves: the downturn in Mexico's economy
The crisis facing Sri Lanka's cinnamon industry just now is a direct repercussion of the WOrsening financial position faced by Mexico through its balance of payments problems. (See “Commodities' column. On page 12). The adverse international economic environment has also resulted in sharply higher costs of foreign finance which Mexico requires so desperately at this juncture. - After four years of spectacular GNP growth, backed by a rapidly increasing oil Wealth and vast amounts of foreign credit, the tide suddenly turned for the Mexican economy. By the end Of August this year the world's financiers had, according to the Economist, "put together a rescue package for a dollar-dry Mexico with the speed of a conjuror's hand. But Mexico's financial crisis has not disappeared. It threatens to haunt the international credit market for years'.
The rescue operation is said tes be an enormous task, involving the managing of foreign debt of about $60 billion of which Over $17 billion is due for repayment in the next few months of 1982. These loans have been taken from nearly 1,100 foreign banks, most of them American. Furthermore... the US provides Mexico with almost two-thirds of its imports and there is American concern too that funds should also be found to finance these. As its oil wealth increased so did Mexican imports from the US, going up from US$ 1.7 billion in 1970 to US$9.9 billion by 1979; while Mexican exports to US also soared from US$ 1.2
而 peso pluMENets
Mexican peso against US$ Desos per $
2Ꮕ
Dev2tation
luațịOm- -*-
ill-l 上具 - l--ll 些—旦 上 C F አA AT ፳Ã ل = ل 1951 1982
ECONOMIC REVIEW, SEPTEMBER - 1982.
billion to US$ 9.6 bl. period. There was Crease in the US Mexico during this
Mexico haS als vily from the priva ket; in July the E that in its hard pre was paying 183% $100 milli On Eurob expensive ever.
The rescue p. for Mexico at the b tember includes a p International Set three month credit lion; this credit to American's Federal and the Bank Of So also offers from the payment for high crude oil and also f credit in the US fo) Mexico. There are obtain a moratoriu.
T 96 of Safik d zes dale vithin Of the year
repayments from t ja ing due Wlthin t mOnLin S. These mea ted to prop up Mexi about three month
Meanwhile, an stepped in and is . terms and conditi loans to Mexico, wh US$ 4.8 billion in th
Mexico Was in rate financial pli! countries in the Lat Caribbean region b Of 1982. The fuel tries of this regi Widened their curre cits last year (fron 1980 to $10 billion consequence Of a St their volurne of impo 32 percent. Most O. in imports and the
 

lion in the same lSO a Sharp ininvestments in time. ) borrowed heate capital marZonomist reported ssed State Mexico
interest on a Ond, the most
ackage prepared eginning of SepOssible Bank for tlement (BIS) for US$ 1.85 bilpe guaranteed by Reserve System pein. There are a US of advance grade Mexican or guarantees of crop exports to also attempts to m on principal
Base2,
Sb 50
% في 騎* | 尋5
40
35
3 O
25]
ހަކަ:-t-+--
he public sector ne next Unree SureS are expecco's economy for S
IMF team has nuw is negutiatiling Ons Of is fuither ich could run to ree = yearS. the most despeght anong all in American and y the beginning exporting cUunDN had heavily nt aCCOunt defin $4.5 billion in in 1981) aiS a rOng in CreaSe in rtS. by as much as f these increases resulting enlar
concentrated in Mexico. Peru and Venezuela. TO finance their external deficits, these Countries almost doubled their net foreign borrowingS. Mexico Was responsible for the bulk of the net borrowing, accounting for $12.7 billiOn in new debt in 1981. Exchangerate management Was a Serious challenge for policy makers in Several of these countries; periods Of Over-valuation were followed by massive dievaluation in the four countries of Argentina, Bolivia, COSta Rica, and MleXicO.
Mexico’s péso was devalued against
ged deficit WaS
the US$ on February 20 and again in
August. One lieu Son was the impact Of the weakening prices of its Oil exports since mid 1981. With the falling oil revenues, and fears of devaluation in early 1982, there appeared a great interest among Wealthy Mexicans in property in the US and a resulting heavy fight Of capital from the country, including a run on the peso. This situation was halted with a 30 per cent devaluation of Mexico's currency and a jump in the value of the dollar from 26.80 to 35.50 pesos. Fears of another devaluation, together with high US interest rates, are continuing to cause a dangerous drain of capital Out of Mexico.
Merely to keep its old debt rolling Mexico has to go on a major borrowing spree and raise an estimated US$ 28 billion this year. Of which 17 billion is needed to renew existing loans. A borrowing target or this magnitude Seems beyond Mexico's capabilities, especially - as many international bankers have excluded Mexico. from their “acceptable” borrower’s list. Over - 20 per cent of Mexico's foreign is debt is short term (loans of one year or IeSS) and With international currency reserves of around US$ 3.5 billion it's cash-flow is said to be extremely tight and imports becoming more and more difficult. . . . . . . . . .
11

Page 14
FINANCE
iMF Coapensatory Financing
Sri Lanka's external aSSetS continued to decline over l982, witn a decline in real earnings from its exports and an increasing import bill. Line International Munetary Fund thus approved a loan of SDR. 39.2 million (approximately R.S. 875 million) for Sri Lanka, under the CumpenSatory financing facility. This drawing is intended to compensate for a shortfall in Sri Lanka's export earnings during the 12 month period ending July this year. Dulling this 12 month period Sri Lanka's export earning from tea, the leading cummodity export, fell by SDR 31 milliOn, and iron rubber by SDR 15 million from medium-term trendS. Together, these two commodities account for about half Of Sri Lanka's export receipts. (The average export price for tea, during the first four months of this year, at Rs. 32.65 per kilogram recorded a decrease of 12 percent compa.ed to the same period in 1981, while the average export price (fob) for rubber, during this same period, declined by 21 percent from Rs. 23.30 per kilogram to RS. 18.31 per kilogram).
By June 1982 the Internaticinal Reserve of the Central Bank had come down to Rs. 5,015 million, acaccording to Central Bank data. The position of International Reserve of the Central Bank has been as frillows since the beginning of 1982:
Month RS. Min
Jan. 7,788
Feb. 6,496
March 6,742
April 6,867
May 6,122
June 5,015
According to latest provisional
data, Sri Lanka's gross external
aSSetS declined by RS 1,054 million in June, and stocd at Rs. 7,495 million (SDR 329 million) as at the end of the month. The level of gross external assets at the end of June, was adequate to finance approximately 2 months imports projected for 1982. In the International Reserve Of the Central Bank, the major debit items were the sale of foreign exchange to COmmercial bankS and the aCCIUỉSition of Special Drawing Rights (SDRs) amounting to Rs. 2,385 million and Rs. 159 million respectively; also exchange rate adjustment R.S. 121 million and an Ortization Of loans Rs. 116 million.
The Central Bank also reported that the cumulative change in exchange rates since 16th November, 1977 indicated that by end of July, 1982 the Rupee had deprecated by 23.4 per cent against the U.S. Dollar, 19.9 per cent against the Pound Sterling, 20.2 per cent against the Japanese Yen and 17.2 per cent against the SDR. -
12
Cinnamon Mal Crunch
The export n has experienced tne middle Of t Lanka's biggest Serious balance O. by mid Sep Cemb a kilogramme O. quality Wauch ea 5u/ - had COme dd cOrding to Colom by the end of A quills were sold 2.3/75 to RS. 2.6/7. R.S. 25/25 to RS year earlier. Cin. SOld and qui Oted 5/- a kg. There drop in prices tember Since Sna coming into the a slightly better
Producers, pa
Tab
Mexico U.S.A.
Chile Colombia
Denmark Germany F.R.
Others
Total
Source: S
Of the Southern in the Bentar. deniya and Hin whose livelihood crop, were left StOC kS SinCe buy accept them. AS 60 per cent of 1 mOn imports wa Mexico last yea Mexico was the counting for nea the total value tionally Mexico
Table
Cinnamon Quills
Cinnamon Quillings
Cinnamon Chips
Cinnamon in other fo
Total
Source: Sr
 

ket Faces the major importers of Sri Lanka's Cinnamon but exports to both trneSe Sourಳ್ಗು 麗 tಳ್ಗಣ್ಣ in recent timeS. ccording to table 2 exportS larket for cinnamon have continied to rise in recent a slump from about years botn in quantity and value his year with Sli and reached a peak of 9,174 metric buyer Mexico facing tons and a value of Rs. 30 million f payment problems. last year. In 1982, however, upto er, reports stated, the first four months of this year, f cinnamon of C5 cinnamon exports were trailing bearlier fetched R.S. hind last year's performance. AS own to Rs. 35/-. Ac- seen in table 2 both Ouantity and bo auction prices value of exports in 1982 had fallen ugust H. 2/3 quality behind that of 1981. Over the next and quoted at R.S. four months there were indications 5 per kg. as against that both volume and value of ex27/75 per kg... an ports had plunged even further. Plinamon chips were ces in the local market were falling at Rs 4/- to RS. and while producers were asking rehas been a general tief from the Ministry of Trade, the and in early Sep- trade was asking that the floor price aller quantities were of cinnamon, which varies between market there was US$ 4152 per mt. ton for C5 quademand. lity to US$ 2211 per mt. ton for rticularly in areas H2 quality be revised.
le 1-MAIN BUYERS OF CINNAMON PRODUCTS
1980 1981
Quantity Value % Ouantity Value %
M.T. Rs. m.n. Value M.T. RS. m.m. Value
1279.4 57.1 25.1 4717.8 262.4 61.0
1064.6 34.3 15.1 758.9 33.1 7.7
237.3 8.1 3.6 561.3 25.4 5.9
256.3 8.1 3.6 346.4 15.1 3.5
16.5 .4 2 282.7 11.4 2.7
1774.2 8.5 3.7 205.7 10.6 2.5
33.11.2 111.3 48.9 2300.8 72.1 16.8
7939.5 227.8 100 91 73.6 430.10 100
ri Lanka Custom of Returns
Province such as There was one official view that
a Elpitiya, Karan- over-production could have aggraduna electorates, wated the crisis for producers. Since ម្ល៉ោះ *蟲 the market was good in 1981 exports "her" increased by over 2,000 tons and ity producers were expecting, this trend valu cinna to continue, but conditions have Saccounted for by changed in 1982. Another view Was in 1975 too that though sections of the trade
largest buyer ac- were pressing for a reduction in the rly ž5 per cent of floor price the interests of produof exports. Tradi- cers, who are now most affected,
and US have been Will have to be considered first.
2-SRI LANKAS CNNAMON EXPORTS FROM 1980
Jan.-April 1980 1981 1981 LLLLLS S S LSLSSSGLGLGLS S LL0L S LLLS SLLEESSS S LLLS S LES LLcELSSS LLL0LS LLS LLcELS
... 4,965.0 206.8 7,611 403.6 661.3 143 670.1163 ... 1,998.7 3.7 449.2 4.4
}rms ... 32.2 .4 34.5 1.3
... 7,939.5 227.8 9.173.6 430.10 2,178.3 102.9 1,532.0 83.0
i Lanka Customs Returns
ECONOMIC REVIEW, SEPTEMBER 1982

Page 15
Successful trials on Sri Lanka’s first solar dry
Tihi Efe are now plans for expanšG. Of St. Laikas first successful proto-type solar dryer, which has diried over 3,000 cubic feet of sa Wn timber Siace it was set up in 1981. SGMme Cf this timber ha. S gone into the top planks of the Office furniture supplied to the new Parliament
bilding.
The solar dryer set up at the Boron Rubber Wood Project at Horana, which limits defects associated with wood shrinkage, has also draw I
the attention of Scientists at the Coconut, Tea, and Rubber Research Institutes, who have been considerig possibilities of using a similar Solar dryer in different aspects of drying their agricultural productS. The potential of Such a drying chamber to dry cereals and spices COuld also be a pOSSibility if the results of the proposed expanded dryer fulfil the required standards.
The US Forest Products Laboratory in Madison, Wisconsin, designed and built this Ovy cOSt SOla dry kilr when Hope Todd, the Director of Borwood (a subsidiary of the Indistrial Development Board), visited the Wisconsin Institute and saw the proto-type dryer developed for low-latitude locations and thought it would have application in Sri Lanka. On tais return to this country he contacted the local mission of US Agency for International Developnegat and requested Support to enstage the Forest Products Laboratory in helping to build a solar kiln is Ši anka.
The two scientists in charge of the wood drying research institute }f the US FOIrest ProducțS LabOratory who helped to set up the solar dryer at Hirana writing in a recent issue. Of 'World WOOd' make 2. strong case for such dry kilas. They state that “even for domestic parkets, dry kilns can be justified in develoging countries. Such kilns elirinate long air drying times and redice noisture content to levels Over than can be attained with air drying. But processors in many of these eguntries lack capital to build stategf-the-art commercial dry kilns. And the cost of fossil fuels to operate kilns is often prohibitive. For these reasons, solar dry kilns offer an attractive alternative. Solar drykilns can be built and operated quite inexpensively in labour-intensive societies, and no purchase of fuels is needed.'
Before this project, Borwood has 9nly an air drying shed, Lurnber was tmS0Y SS LLLLLLmL iS SDJtt0aLmSSYLLLeLeeALA S LLLLLLaLaLlLLLLLLL S SYLLLS S S0L0L atteragi, to air dry from 60% down to 15% moisture content. A noisture
Econostic REVIEW, SEPTEMBER 1982
Coatent of betwee St.able for the Čišlaite. Et prO tiGI: 3.3d Cracking È ilife injicated thi GCI tent Gi the ai probably above 1
The SiOa? ki ruary 1981. Initial 2.5-cm-thick rol
ite finish-dried in 15% in less than
lans to operate
in anner, i.e. air リYé Cönté霊it 箕_露5_t@ 雳(th、 tg: 45 diays, tia eiia SG1リ ki1意 誌○ 14%。 grainime, drying ti ened by about 50 fiil distire COIN
5%.
š). VAfilia leader reported the proto-type sola
WOrkers in Stal tor for the solar 2 in Horano. Becaus, separate from the | it can be sized t. quired energy dem
 
 

12% and 15% is loist Sri Lankan lems with distorof fini Shedi fil I'niiiat the moisture driedi lUniber WäS 孪
0.
was built in Febtests showed that erwood air dried ture content cana the solar kiln to a Week. Bor WOOdå the kiln in this dry fron greeit, if about 60% doWiFi, s should take 30 ish-dy in ühe With this prOme can be short% and provide a tent safely under
Simpson, project recently that ar dryer establish
the Sol(?” COlle C3umber dirger built e the collector is
drying chamber, supply the reGid.
ed at the Borwood Complex nas iläi etion ed Very Satisfactorily overto the past, 18 mm Oratins, except 1 Oro ring deicts. He recommended that a folow-up of the proto-type dryer si Otilici pe eSita, joli Sined as a COKati Kalla.-- tion of the research and development of the existing dryer with tae interation that this expanded prot,0- type would gave the way for the establishment of a cominercial dryer. He has also Suggested Yarious modifications to existing dryers and advised on such possibilities as having a Heat, Exchanger, and using Offcuts and wood waste which could provide the required heat to the Chamber during non-Sunshine hours. Timese American Scienti Sts al SO visited Burma, recently to establish a Horana, proto-type solar dryer at the Forest, Research Institute of the Government of Burma, for their research in timber drying. On their way to Burma, they visited Sri Lanka, to evaluate the performance of the Horana dryer so that if necessary similar modifications could be introduced to the Burma, project.
The moisture content of timber in the BOrwood Project, after solar drying was approximately 16% on the average. The value of the Solar ti'yirag chamber in addition to Other forms of drying such as oil and electricity is approximately 1/3rd the cost per cu. ft. Borwood is now working towards having a heat exchanger established at the prototype dryer so that there could be aree charges per month i.e. the capacity of the existing kiln will increase frO}El 150 cu.. ft tO 225 Cu... ft. A complete Meterological StatiOm had been established for monitoring solar radiation, temperature and rainfall, relative humidity, wind, Sunshine recorder and Other meteorological data reduired for an expansion of this poject.
In the expanded project, for waich assistance is now being sought, the drying chamber would have a capacity of 3,200 cu. ft. in comparison to the 800 cu. ft. of the existing proto-type dryer; and would give a drying timber quantum of 1,000 to iing timber quantum of 1,000 to 1530 c.ft, per charge. The production target at the Horana Complex is 5,000 cu. ft. of sawn timber per month and the expanded dryer is expected to give a 40 per cent drying capacity monthly which would save drying time upto three months.
This improved drying process is to be put to good practical use on a new UNIDO/UNDP assisted project for producing glue laminated structural connponents from rubber wood. It will now
be possible for this project also to move
from the research and develoonent stage to that of commercial utilization. UN expertise and modern equipment, together with Industries Ministry backing, have all been combined to produce wealth out of a wood that was originally condemned mainly for burning.
3

Page 16
Emerging Trends in the Open
The post - 1977 economic reOtras economy) though creating substantial investment and ecojn C#.maic growth rates, have come up against problems which could even undernine the viability or the sustainability of the “open economy' over time. Some of these problems were highlighted at the World Bank Sponsored Aid Group meeting held
in Tokyo in June this year. The principal Weaknesses in the Open economy as it has Operated Since
1978 may be summarised as follows: - Lagging export growth in the context of high import growth and deteriorating terms of tradie. - Relatively low level of investment, in manufacturing compared with tourism, trade and construction. - Poor national Savings perfornance in the context of a high rate of investment. .
- Economic instability as reflected in growing deficits in the government budget and the current account in the balance of payments, and continued high rate of inflation.
- Prospects of a drastic decline in foreign exchange reserves by 1983 (and even an exhaustation of reserves by 1984) unless early corrective measures are taken to reduce the budgetary gap and deficit in the external - a CContS. - Absence of a major energy conservation effort in the context of a tight energy situaΕίΟΥις - Evidence of worsening relative income inequalities carrying with it serious Socio-economic COՈSequenceS. 。 In this column we begin a. disCUSSi Oh Of the fir St, tWO VĀJeakineSSeS mentioned above namely, the lagging export growth and the relatively low manufacturing growth; and this discussion and also an analysis of the other issues will be: left for Subsequent columns in this journal.
Lagging Export Growth
An acceleration of overall export growth was one of the principal objectives of the economic reforms of 1977. An economy with liberalised imports can obviously be viable in the longtern, only if exports grow fast enough and adequately to meet the growth in imports. The resort to foreign loans and aid to finance the import-export gap car only be a
14
(econComic liberalisati0n/open -
ti'an SitOry phenO) quick and sizeabl ports is a sine C all Open eCOIn OIIly. Lanka, the Substa in the terms of tr (by about 30 per 81), resulting in a line in the import Of a unit Of eXp factor if the feet port growth. Thị İnteist, and the siz market which in efficient innosyrt also important CO. need to achieve a he recorded Si COuntries which economy policies Taiwan) Were lar Successful export lized Within a rel: Of tine Ayitiin the lised policies.
What has bee Sri Lanka's expor the past four yea. economy? As Seen
璽為豎 量
Totali Export Value
US 1977 74. 978 848 1979 979 1980 1945 1069
98.
the growth in exp Bolly lagged behint imports. While diture (in US DO per cent during 1 earnings (in US by only 44 per
the export/impOrt extent of the imp exports) fell sha.I. irom 90 per cent cent in 980 and The lagging expo clearly evident in
DUlling 1977-8 volume has very export volume
growth of less th sides the deterior of trade (which
ÎmpOrt pufChaSÎfì! of exports by abo timajor reaSOn . foreign resource al nost, insignifica volume of exports
 

Economy
[ՈՅՈՕ1Ռ. A fairly e increase in exUa nOn to Sustailín In the case Of Sri ntial deterioration ade in recent years cent during 1977COnsiderable dec, purcha Sing pOW er Orts, is a further to accelerate exe resource end OWe Of the domestic it the Scope for substitution are insiderations in the igh export growth. lccesses of other have pursued Open (e.g. S. Korea and gely a result of a, performance reatively short period ad Option of libera
2n the record of "t performance in rs of a liberalised
in Table II below,
The major factor behind the Slow growth in the Overall export volume is decline in the volume of plantation exports. During 1978-81, the export volutiime index of ali three patati Gil product:S ha ci reCOrded a. decline. It may be noted that plantation exports still account for over One half of the COuntry's Overail export earnings. Hence, rehabilitation of the production base of the three plantation crops would be a central factor in the country's export performance in the future year S. Hovever, the reSults Of rehabojlit3, tion, effort'S WOuld be availabie only in the medium and long-term. In the case of rubber, for example, the acceleration of replanting would initially bring down the level of exports (in the rest of the 1980's) with enhanced exports appearing Only in the 1990's.
Shift to Export Oriented
Yanufacturing
One of the major objectives of the “open economy' policy was to create an export-oriented manufacturing sector based on the country's comparative advantage (mainly cheap labour) in contrast to the import substitution strategy of the earlier years. A package of incentives in the form of liberalised imports of inputs, export processing 2. Ones, tax incentives, and a condu
SRS LAN:KA”S EXPORTS AND : SPORTS
Total Import Value
Dollars
721 941 1447 2053 1832
OtS has considerathe growth in the import expenllars) grew by 154 977-81, the export Dollars) has grown cent. As a result ratio (that is, the Ort bill financed by ply over the years in 1978 to 51 per 58 per cent in 1981. rt; grOvAyth is mmOre the volume figures. , while import nearly doubled, the has recorded a an 9 per cent. Beation in the terms has reduced the g power of a unit out 30 per cent), a for the widening gap has been the int, increase in the
Export/ ExOlot, HIRhp)Oirti, Import Volune VoiUne Ratio% Index Index : .t_ - 100 بسی۔ 1978
103 94 73
90 00 00
68 0. 123
5. 99. 140
45
58 O2
cive 'investment climate' were offered to both local and foreign investors. But the achievements have so far been below the anticipated levels. . . . .
On one side of the balance sheet is the virtual eliminati On Of a nunbel. Of high-cost industries, particullarly small enterprises, in the face of competition from the free flow of inported substitutes under import liberalisation. According to a Survey Of unregistered Small scale industrial establishments conducted by "the Central Bank, a considerable number of enterprises active in 1976 were reported to be inactive in 1981 because of their inability to face the competition from imports and also partly because of liquidity problems. The most adversely affected industries included those producing handloom textiles, sugar cane jaggery, handmade paper, fabricated metal products, pottery and cane products, (Continued in neact issue)
ECONOMIC REVIEW, SEPTEMBER 1982

Page 17
FEATURES
A Study of the Prices of Drugs Purchased by the St. Pharmaceuticals Corporation from 1973 to 1981
L. G. Jayewardene and T Atapattu
Drug prices have been a Socially and politically Sens. Sri Lanka and in the early 70's tine State became the of drugs though after 1977 licensed importers from sector were once again permitted to import. In this Chairman of the State Phar inaceutical Corporatio L. G. Jayewardene and the Corporation's Statistical Atapattu examine the prices of drugs bought between and make observations on prices of drugs bought for Sector and State Medical Stores and factors related to prices. They show in their study that between 1973 a much as 70-84 percent of drugs imported had increas and of a total of 226 items nearly one-third or 74 h. in price by over 100 percent. Despite drastic price reduc Corporation; after November 1977, the changes in pari from 80% - 92% for foreign currencies and this affecte
price of drugs.
The price of drugs is a Socially raid politically sensitive item to which the State and the public show a critical awareness. As a means Of reducing the indiscriminate imports of drugs, the State, through the National Formulary Committee, in 1959, selected and railtonalised the drugs that should be imported.
In 1972 the State Pharmaceuticais Corporation (SPC) was established with the further hope of reducing unnecessary expenditure on drug.S.
Pre-SS ure from pharamaceutical inianufactures of the developed world was also reduced by transfer
of buying from the private sector to a state monopoly by the SPC. As a policy, quotations are called
bv generic names. In 1972, a mOve was also made to purcha,Se drugs from socialist countries which trade tider generic names.
The SPC was the sole importer of drugs for Sri Lanka from 1973 to 1977. After this date the State alLoved a free import of drugs, approved by the National Formulary Committee, to licensed importers.
In this study, we examine the prices of drugs bought for the pri
Vate Sector by the SPC during the
years 1973 to 1981. Observations are also made on Some large value purcases made for the State Medical Stores (SMS) during this period. The study includes observations on the sale prices of drugs and factors related to these,
PURCHASE PROCEDURE;
A brief reference to the purchase procedures adopted by the SPC is relevant.
Purchases are made by “World
Wide' (WW) tender, by “Restricted Quotations” (IRQ) where offers are called from known acceptable suppliers, and by 'iDirect Quotations' (DQ) from monopoly suppliers
Econoitre REvtsy, Srpiggy BER 1982
PRICES OF 84 DR
UNDER WOR] TENDER (
A Study was má Ces Of 84 items (frOn ces) purchased afte tender (almost cont vợ7 een 1973 to : 977 (Si purchases were made tender after 1977, 'W ces are not updated
The final price i. studied in relation of 1973, and describ crease, decrease Or S'
The majority of price increase which monly used drugs S crobials, antihistan sics, and vitamins.
The study of between 1977 and 197 highest number of p. in 1975; (59 items ot 25 items show a price
WリGHTED AVER OF 58 “FAST MO 3 OUGHT ON “We
TENDER'' 197
TIʻhe weighted av 58 fast moving items world wide tender,
Table ---- PERCHE VARA
Year
Total number of items imp Number of items with Pric Number of items with Pric Number of items with Stat
* In 1981 some of the earl imports for 1981 are a

tE
tive issue in 5 Olle ilicitei” She private study the Dr. (Mrs.) Officer T. 973 and 1981. the private ) changing indi 1979 a S ed in price; ad increased tions by the ty increased d the retail
UGS BOUGHT LD VAVIDE WW)
ade of the pridifferent sourr World Wide inuously) betince Only a few 2 by world wide World Wide” priafter 1977).
in 1977 has been to the prices ed as price intatic price.
items show a apply to COmuch as antimihines, analge
urchase prices 3 show that the *ice in Crea. Ses is it of 84); while
decrea. Se.
AGRE PRICES VING TEMS” DRLD WIDE 3 - 1977
Brage price of Obtained after from different
suppliers was studied to 1977. These items belong to the same therapeutic groups mentioned in the paragraph above.
In this group also the majority of items show price increases with the largest number in 1975, when 46-67% of it eis Snow price increases.
In 1977, 32 iters show a price increase, 13 items a price decrease, While less than 10 are static.
Table 1 shows the number of items were purchased between 1973 and 1980 fron a monopoly supplier Or from a single known reliable source due to the clinical importance of the item.
The base year for price comparisons is 1973. Each succeeding column. Shows the number of items with price increases, decreases etc. over the immediately preceding year.
Price Increases
The majority of price increases are in 1977 and 1979 where of a total of 210 and 155 items purchased, 113 and 106 respectively show a price increase. In 1980 due to a deliberate policy to reduce imports, only 115 items were imported but 70 items (74%) show a price increase. These facts are significant as each item is purchased from the same source and the prices show 2. steady increase.
Price Decieases
The largest number of items were purchased in 1977. Therefore the majority of price decreases - 41 of 210 purchased, is also seen in 1977.
This high purchase of drugs in 1977 is partly explained by major staff changes within the Corporation, when Sufficient controls may not have been exercised on the number of items imported.
PEr:CENTAGE PRECE VARIANCE OF ITEMS OBTAINED FROM SINGLE SUPPLIERS 1973 TO 1980
The percentage of price increase/ decrease etc. in Table 2 below refer to the same items as discussed in Table 1. The base year for compa
CONS OF ITEMS OBTAINED FROM A SINGLE SOURCE
BETWEEN 1973 AND 1980
1974, 1975 1976 !977, 1978, 1979
169 149 155 20 161
84 105
Corted 2 increases 2 Decreases c Price
*1980 1980/73
155 15 -— 95 13 92 106 7鲁 O5 10 19 41 - 28 19 2. 08 34 41 56 41 30 33. O2
er monopoly and virtual monopoly sources were changed and therefore it discussed under this heading.
5
__-ר

Page 18
Table 2-PERCENTAGE PRECE VARMANCE GH ITEMS OBTA
窓リRS 動愛73 『○ 豊9km
Yeye 73 Total no of items imported 69 A. Price increases
100% and over ... 三、5 翼 39 75%99-س%, ... 。,三量 C 多萝 50%-74% e Ο 25%-49%, e 8 s ... 5 蕙 * 0.5%—24%,. 。苇Q
F iota Price hereases 84 KG Static Price:S 69
Price Decreases
0.5%-10% ges 。量2 建 11%-20% 。_重 J. Over 21%, Decrease K total Price i.ecreases 。重6
74 75 76 77 7
49 155 2 O 6
O 6 7 2 7 5 0. 9 9 7 20 28, 19 18 72 45 74 66
鑫5亨5三量重4 92三量较 24_41,5G一4丑 3
6 S 22 17 2 2 1 0 3 2 2. 88 10 19 40 28
* These refer to countries with the highest number of increases
}orice Enereases
Table 2 shows that the majority of price increases are 0.5%-24% over the previous years price (row E").
These increa,Ses do n'Ot restrict themselves to any particular category of item but countryWise price changes appear significant. UK and India show the highest number of items with price increases falling between 25-74%. The largest number of imports during 1973 to 1980 have been from these tWO COuntries. Since the awards are made On an acceptable quality and price basis, had the purchases been from other countries, it is likely that the range of price increase would have been Over 100%.
Price Decreases
The majority of price decreases are between 0 to 10% of the previous years price, and amount to about one item from each country.
ROW 'H' Shows the number With an 0.5 - 10% price decrease, row I an ill to 20% decrease, and row ‘J’ a decrease of ore than 2%.
The fact that the majority of price increases and decreases Occured in 1977 is because the highest number of items was imported in this year.
Static Prices
Static prices are seen for 30-69 iteras during this period and refer to purchases mainly from West Germany, Switzerland and India.
COUNTRY WISE PRICES OF ITEMS BOUGHT FROM "MONOPOLY SUPPLIERS BETWEEN 1973 - 1980.
Table 3 is shown as Tables (i), (ii) and (iii) and refer to prices of Monopoly Purchases made from 5 countries between 1973 to 1980.
16
United Kingdom
In the peric largest number have been bough a lesser number in previous yea: iteins) 40%, sho Over 1979. This 1974 OV/aids til from U.K., show
Ce3Se.
india,
In this peric imports are frO]
Table 3(1)NO. OF N
Country/Year United Kingdom India Switzerland West Germany U.S.A.
* Figure within bi Table 3 (ii)-N
Country|Year
United Kingdom India Switzerland West Germany U.S.A.
Table 3 (iii)-
Country Year United Kingdom Índia Switzerland West Germany U.S.A.
* Figure within

NED FROM SINGLE
5 115
3 5
O
6 8
3 三器
3 49
6 70 O 33
2, 6
4三3
3 3 9 2.
εία
79 80/73 Country'
UK India Hong Kong U.K.
India Switzerland W Germany India.
Switzerland
Switzerland
Hong Kong Belgium
within the range.
d. 1973 to 1980 the of monopoly items t from U.K. In 1980 was imported than
(29 of 34 w a price increase indicates that from he drugs
a steady price in
is but
imported
d the next highest m India, and WF
AONOPOLY TEMS WITH PRICE INCREASESFRONAS COUNTRIES'
1974
1975 1976
학(56) 42 (54) 45 (31) 06 (26) 19 (23) 08 (23) 13 (20) 06 (11) 05 (15) 07 (12) 04
lake atte again that these prices refer í G “Hiot GPD}y' iteIns offered
mainly fram Subsidiaries of Matij
and transnational companies. The
table shows that prices have in
creased or reitailed static and -
price decreases are few S専誌写ejaid
Pur Cha. Se S from Switzerland e - fer to items bought from well known COinpainies Such as Ciba-Geigy, Sandoz, Roche, Swiss Serua etc. Their rices though high, have remained static in coin parison with prices in in the other countries. More price die Grea.Ses are Seein bộetyÀYEen the years 1973 to 1976. West Germany
Twenty Six (26) items yere imported from West Germany. Prices have remained st3tic and thereafter the tendency is for Some items *O sh OW a price in creaSe. U.S.A.
With regard to purchase from U.S.A., nore price in creases are seen throughout except, in 1978, while price decreases are slightly lesS than Static priceS.
The overall picture from all countries is a tendency for price increase and is probably to be expectied as for all other CO in Odities.
This study, which showed general price increases, did not reveal any significant information on price changes of therapeutic groupS. The increased prices applies to several groups, as Inentioned in the prices of items purchased after WOrld-wide tender.
1977 1978 1979 1980 8073
(48) 42 (70) 53 (62) 52 (53) 47 (34) 29 33 (30) 11 (32) 13 (22) 08 (25) 16 (22) 14 22 (19)10 (27) 08 (16) 02 (17) 08 (11) 01 07 (15) 05 (24) 10 {18) 04 (20) 10 (17) 11 16 (16) 12 (21) 12 (17) 08 (14) 07 (12) 06 10
ackets shows the total number of items imported.
NUMBER OF MONOPOLY TEMS WITH PRICE DECREASES
FROM 5 COUNTRIES
1974 * (56) 02 (54) 05 (48) 03 (70) 09 (62) 04 (53) 02 (34) 02 01
(31) 02 (26) 0
1975 1976
1977 1978 1979 1980 80/73.
(30) 06 (32) 03 (22) 03 (25) 04 (22) 0
O (23) 04 (23) 02 (19) 02 (27) 06 (16) 03 (17) (1 (11) 02 O2
(20) 0
1974.
*(56)12 (31) 23 (23) 11 (20) 14 (15) 14
(11) () (15) 03 (24) 06 (18) 08 (20) 05 (17) 01 (). (15) 04 (12) 03 (16) 03 (21) 05 (17) 09 (14) 03 (12) 03 O
-NUMBER OF MONOPOLY TEMS WITH STATIC PRICES
FOR 5 COUNTRES
1975 1976
(54) 04 (48) 03 (70) 08 (62) 06 (53) 04 (34) 03 (26) 07 (30) 1.4 (32) 16 (22) 11 (25) 05 (22) 08 (23) 08 (19) 07 (27). 13 (16) 11 (17) 08 (11) 08 (11) 06 (15) 07 (24)08 (18) 06 (20) 05 (17) 05 (12) 05 (16) 01 (21) 04 (17) 0 (14) 04 (12) 03
1977 1978 1979 1980 80173
trackets shows the total number of items imported.
ECONOMIC REVIEW, SEPTEMBER 1982

Page 19
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Page 20
PERCENTAGE OF FOREIGN EXCHANGE SPENT ON IMPORTS FROM DIFFERENT COUNTRIES
Table 4 shows the percentage countrywise expenditure on imports for each year, between 1973 to 1981.
The Observations are limited to a few countries of maj Cr significance. We cannot generalise On the pattern of imports for each country excepting perhaps for India and U.K., where the percentage of imports have remained between 1728% and 10-27% of total imports respectively between the years 1973 to 1981.
India.
Purchases from India are steady throughout. In 1980. the highest imports are from this country. There are two categories of suppliers in India, the traditional: and non-traditional (or generic). The former are Subsidiaries of multi and transnational companies and the others
are local Indian manufacturers. Some of the latter have been Collaborators of multi and trans
nationals previously and are well known to the Indian trade. The ratio of purchases of traditional to non-traditional SOurces is as 11:9. The purchase of some items are restricted virtually to a single reputable SOurce eg. InSulin, Phenytoin Sodium, Hydrogen Peroxide and Eenzathine Penicillin. Purchase from lesser known suppliers will necessarily increase in the future in order to meet a competitive local market-while keeping a watch. On quality. United Kingdom (U.K.)
UK. Was in first place in 1979 due to a large number of imports from a single generic source. These imports are now made from Other cheaper, yet acceptable SOurces, eg. Vitamin A & D. Phenoxymethy1 Penicillin. Items that have remained as confirmed purchases from U.K. are Chlorhexidine and Cetrimide Lotion, Vitamin B & C Forte liniection and corticosteroids, though SOrne of these have Shawn a 100% increase in price from 1973 to 1981. Switzerland
An increase in imports has taken place since 1978. This country has remained in the third place since. Though their prices are stable they are relatively higher than those of other countries; but this country remalns an established source for a few items such as vaccine. Sera, inumunoglobulins and Rifampicin (until recently).
PurchaSes made from a new generic manufacturer also to the increased purchases.
* Traditional mannficturers are the discoverers who patent their products. Non-traditional or generic manufacturers, manufacture the product after patent expiry or on locn icefice etc.
18
COintributed
Italy
S'rOn 1973 C ally moved to 4 Inum imports w p11erS from ni. On sources. The it antibiotics, 2. 1ini`u1siOnS. A lar microbial purch sisted of CO-tril chase, of this it
to other accel sources. An iten noxazole Whic
rity has also r of this item.
A large Cill was also purcha petitive prices lity of infusion tries has reduce Italy.
J.S.A
PUCina SeS i ted to a few i mand Such a.S romycin and ey
China
China has siderably after would probably able tО meet th ity has remain ces competitive.
Singapore
Singapore r ports for 1979. from 1.3% in 1 proved to be a anti-microbials traditional m: ance on quality against price ir: importance of t
W. Germathy
Countries w creases of imp many (Table 4 from 12.35% in The decline has be explained by diagnostic SubS from thiS COur chased by the C Substantial (). U ment in the pri and these item or transferred
TABLE 7
MAJOR TH
. Antimicrob . Electrolyte
Vitamins & Antil Cance * Antiohvrier Hormones Antiseptic
 
 
 

nwards Italy graduth place; the maxiere in 1977 for Sup
traditional generic ems imported were tihypertensives and ge part of the anti aSes for 1977, COslnOxaZole. The purem has now mOved
table but cheaper n similar to CO-trin is gaining popula2duced the purchase
antity of infusions sed earlier, but COmand acceptable qualS from other COUlld the purchase from
rom U.S.A. are limitems of major dePrednisolone, Erythfe preparations.
moved forward COn1978. The purchases be more, if they were Le demand. The quaed good and the pri
eglsters 5.3 % of imThis is an increase 973. Singapore has reliable Source for from subsidiaries of anufacturerS. Relihas been valued view of the clinical heSe itemS.
hich registered deOrtS are West, Ger) which has dropped 1973 to 2.49% in 1979. been Steady and Can the fact that radiote inces are imported ntry and Were pur}orporation in 1973 in antity. Their movevate sectnr was slOW s were either gifted to state institutions.
Further the Company places a restriction on imports by insisting On minimum value orders of 5000 D.M. for items which would be totally uneconomical.
Poland
Another country which registers a decrease of imports is Poland. When the Corporation was established in 1972 there was a declared policy to import drugs from generic sources. In 1973, 8.35% of imports was from Poland. 1974 and 1975 shows a fall and 1976, an increase to 10.45% of the total imports. In 1977 there is a slight overflow Of 0.2% from 1976 orders. After 1977, the SPC has not made imports from this country. The fall is due ፲jO trade problems which were not satisfactorily resolved.
The details pertaining to foreign exchange on imports from Other countries are also given in the table.
IMPORTS FOR THE STATE
MEDICAL STORES (SMS)
The purchase procedure for SMS has always been on World-wide tender. excepting for a few monopoly
teñS.
The total expenditure has increased over the years as seen in Table No. 6.
TABLE 6
YEARWISE VALUE OF SMS PURCHASES 1973-1981
(Corrected for comparison to present
rupee value)
Rs. Million
1973 •=--------> 24 1974 332 1975 52.0 1976 624 1977 402 ܒܚܒ j98 == 1044 1979 map 168 1990 -re 119.1 1931 me 59.9
Table 7 shows the major thera peutic groups imported by the SMS and the SPC from 1973 to 1981 as a range of percentage. The figures are given in order of expenditure and comprise more than 70% of the total imports.
ERAPEUTIC GROUPS OF IMPORTS OF SMS AND SPC
ials (& Antibiotics)
Solutions z Antianaemic Drugs er Drugs ensives
& Disinfectants
SMS SPC
30% 220% - 0ھی ہے% 10% = 20%; 1.5 ہے%
3%一。5% 1% - 6 % %重 2 - 5%--------ئے -%3 3%%,5% 2% 3% - 5% 1%_-_6% 3% - 5% 1%,3%
75% 59.5%
EconoMIC REVIEW, SEPTEMBER 1982

Page 21
The table shows that certain items are more in demand in the State sector and these represent the needs of patients who are seriously ill requiring hospital and Institutional care eg. electrolytes and anti cancer drugs.
COUNTRY WISE EXPENDITURE; ON SMS IMPORTS
There is an indication of variance of SMS imports for 1981 conpared with 1980. It is seen in Table
6 that the total value of imports increased by 19.8% in 1981 over 1980. It is observed that 63.6% of this increase is due to price increase and 36.4% to drug volume increase.
I Complaints were received OI) supplies made from some generic sources in 1980. The 1981 awards were therefore made to Well known suppliers for items of critical clinical value, such as injectable penilcilins and their derivatives. This a Ccounts for the major portion of price increases
Drug volume increase cannot be significantly assessed because small ouantity increases have been shown for a large range of items and analysis of this would riot provide infornation of significant value.
CHANGE OF PARITY ANT) IT'S
EFFECT ON THE RETAII, PRICES OF DRUGS 1973-1981
A brief discussion on the chan
ges of parity consequent to devaluation of the Sri Lanka rupee from November 1977 is appropriate as it has affected the retail price of drugs. The changes of parity (from 1973 to 1980) relating to the currencies of 6 countries from which most of our drugs are imported.
Pre-devaluation as reported below, relates to rates from 1973 to November 1977 and post-devaluation, to parities after November 1977. We refer malnly to tine post-devaluation change as this affects the volume of purchase.
The Indian Rupee shows a post-devaluation increase of 80%.
The Swiss Franc shows an 87% increase between 1973 to 1977 and a post-devaluation increase of 97%.
The Sterling Pound shows a postdevaluation increase of 85%.
The US Doar (in which several countries make their offers) has shown a post-devaluation increase of 30% over 1977 and 146% over 1973.
EconoMIC REvrEw, scPTEMBER 1982
The Belgium Era increase, post-devalua FLira, a, 91 % inCrea,Se dievaluation and a 268
1973.
n SUIIY1111a IV, have appreciated by since 1973.
PRESENT PRICI THE CORPC
A note on the the Corporation app at this Stage. In cOr commodity and its cided in early 1978 benefit overrides th terest as far as pri concerned. The go ment was to provild fit to the patient by drugs at the most
The pricing for ted at the time of November 1977 for permitted a retail in 100 CIF. The ull Seel luation was that th ling of the rupee p. poration, the wholes: tailer on the sale O at pre-devaluation p The Corporation from 8.5.78 to 'whic the CIF and retail, (The SPC, therefor as a service Organ. 1979).
A second pricing two tiered structur and 'non-essential' to operation in June From May 1978 the Corporation reta “Essential’: drugs a price while the trad tributors retailed the higher price. From SPC retail outlets as distributor was pern margin of 137%. On sential items'.
The two tiered
gives the impression poration earns a 'co
5% and 15% on the tial and Non-ESSent pectively.
Thé real “Contri ascertained only if
costs namely land in
charges (2%) and in
* Essential drugs a: needed for critic primary health (

Inc shows a 1.05%
ion; the 選電alian immediate post % increase over
all 6 currelicies more than 100%
NG POLICY OF DRATION -
pricing policy of bears appropriate Sideration of the Se, the State de
that the social 2 :OnnerC1al in2ing of drugs is all of the governe optimum beneproviding quality conomical price.
mula which exisdevaluation in processed drugs, margin of 80 on li efect Of devaere was a doubrOfit to the COirler, and the re
drugs imported rices.
was compelled blesale' drugs at at: 8% On CIF. e Operating only sation to June
( formula, with a 'e for “essential' drugs came in
1979. to March 1981 til OutletS sold t a lower retail er and SPC di Ssame item at a June 1979 the Well as the SPC hitted a higher CIF On *nOn-eS
price structure that the COirintribution: 3: Of sale of 'ESSenialo” drugs res
bution can be 2. Other variable
g and clearing sterest on stOck
re defined as those all illness and for
are.
holding (4.5% for 3 months) at 18% per annum are deducted from these values. With these adjustments the sale of drugs gave a net positive
contribution of 2.98% on CIF.
This situation persisted to June 1981 after which date the Corporation Was allowed a reas Ona ble margin of prroft. The Corporation however, charges a lower margin on drugs which are renuired for long term use - e.g. insulin. In the meantime a considerable portion of the market was lost to the private sector, which has many advantages in trading Over a public Sector Coro oration that is compelled to adhere to restrictive controls which are perhans recessary as public funds are utilised.
SUMMARY
i. The no rice behavinur of World Tender items bQuerht in 1979 from different suppliers show that 70% of items have a price increase over that of 1973. ii. Virtual Mono-nolly items alson show that in 1979, 86% of items imrorted shrw a nrice increase over that of the 1973 price. iii. In 1979. Mononcilly items also show th-t 84% have nrice increases over that of the 1973 price. iv. The percentage range of price variance shows that in 1979, 74 items of a total of 226 have over 100% increase in rrice over the 1973 price. The maiority was between 0-25% increase. The price increases ranged from 0.5 to more thain 100%. v. In 1979, the highest nurch 2 ses are from peneric sources in the U.K. In 1981 the highest purchases are from India. vi. After November 1977, inspite of drastic price reductinns by the Corporation the chanores in parity increased from 80% to 97% for foreign currencies and affected the retail price of drugs.
vii. In November 1977, the retail price
was 80% on the CIF price. The present pricing policy allows a reasonable margin of profit to the Corporation; which has however to follow restrictive purchase procedures and compete with the free trading permitted to the private sector.
** The difference between the selling price (in this case the SPC price) and the variable cost of the product is referred to as 'contribution'. -
19

Page 22
AN ELECTRIC LIGHT FOR EVERY RUR
A. Lasantha M. Perera
The Prasnakthi project, developed at Sri Lanka's NERD Centre, has as its objective the providing of an electric light, for every rural home in the country. The principal Research Engineer and Head of the TechnoEconomic section of the National Engineering Research and Development Centre Lasantha M. Perera, argues here that conventional technology will not provide an electric light to the majority of the rural homes, θWeΙΩ within the next 25 years. The answer, he maintains, could be found in a fluorescent light unit supported by a lead acid battery having a reasonable
current capacity. An installed SyStem, including two switches and wiring should not cost more than Rs. 750/-, and a householder would have io paỲ only Rs. 5 per week for illumination which is of better quality and far safer than kerosene
lamps. A possible uo.g. queued Ioseus this project is that it has the potential to climinate the need for kerosene in rural households, which now costs the County an estinated RS. 1,188 million a year in foreign exchange.
The Need for the Project
An estimated 12.3 million or 80.5 per cent of Sri Lanka’s population live in rural areas. But, only 2.8% of rural housing units were supplied with electricity; while only 34.5 per cent Of urban hOuSehOlds had electricity, according to the 1971 Census. Recognising the crucial role of electricity supply in rural development, the government had budgeted Rs. 500 million to provide electricity to 1150 villages during the period 1980 - 1984. At most this would prOvide electricity to about 10,000 rural households a year whereas Over 30,000 new households come into existence each year due to population increase. Thus, the number of households remaining unelectrified is increasing over time.
These households lacking electricity use kerosene (parafin) lamps for illumination. For very many of then a small bottle containing kerosene oil, into which is dipped a cloth swick, constitutes their only lamp, The great inconvenience, the constant danger Of a fire (many Of them live in thatched houses which are highly inflamable), and the poor degree of lighting, is something these people accept as their lot. They have adopted themselves to this fact of life by retiring to bed shortly after sunset. Even if as a result of future government a programs electricity lines are drawn along all roads, and the villager is
20
IN SRI LANKA: AIM OF THE PRASHAK
fortunate enoug roadside, he sti 3,000/- for the
ergy meter, ma wiring and fitti the means Of W householdS. Thu lology will not light to the m homes even wit
five years.
Technical Feas:
Promising te bio luminence a PlayS WOUld hav
mediate SOlutiO]
OI nOW, electric: tablished WorldY ly eficient and ing electric ligil batteries seem
LOOKing at the art in electric în Figure (I),
Stand-Out: hig
lamps, fluoresce
halide lamps. lamps can be technology th and low price siderations in ted availability higher prices W pressure Sodiun lamps are out a project.
"I
iss
20
|_r二
· 3 8ధి #* '';
بية المعه مع مذهبوعية
် ်း ဖ္ရင္လည္းေ ့် -
تم تأ يخلع علمية
A better qui with glass chir Samle light Outp tric incandesce: Generally a 6 v gives a somewl put and is mu Sil.ıce OperatiOn require a fairly nating Current a StUrage batt tied via an inv Figures 2 (a ), results are obt of 30 to 35 Ki modification Of Çuits an Optim
 

AFL COTTAGE
THE PROJECT
in to live by the ll needs about RS. line connection, enin Switch, internal ngS. This is beyond ery many willage is conventional techprovide an electric ajority of the rural hin the next, tWelty
ibility chnologies such as nd liquid crystal disre to Wait, Since imls are demanded. As al lighting is Well eswide. Therefore, highlOW power consumnts fed from storage an obvious choice. current state of the lighting as shown three technologies h pressure sodium Ent lamps and metal Although fluorescent considered a mature eir ready availability are important COntheir favour. Limiand their generally Ould mean that high h and metal halide of reach for such
Lality kerosene lamp mney gives about the Dut, as a 2,5 Watt elecnt filament lamp. watt fluorescent light hat higher light OutCh. ea Sier to the eye.
of fluorescent lightS " high v Oltage alter(AC), power from ery must be COnverTerter. As shown in (b) and (c), best ained at a frequency lo Hertz. By suitable known invertor cirum design was de
veloped consistent with an a Cceptable level of lighting, having minimum current consumption and using readily available components at a OdeSt COSt. The Current. COnsumption for a 8 watt light was less than 400 milliamps, whereas similar units sold in Europe consume almost double this current. The difference in light output is marginal considering that the local light uses a bare bulb. While the imonited unts mostly employ diffusers that also absorb light. Trade-offs between energy consumption and aesthetic appearance for developed country markets and developing country markets are quite different.
The light unit cannot be used by itself, it must be supported by a storage battery having a reasinable current capacity. Torch light batteries although a common item in the village shop. is very costly ner irit Inf A1 octricial energy. Of the rechargeable batteries the lead acid hattery has tha Jnwest initial cost, has a reasonable life span and is fairly well known even in rural 1 a reo is i Cinnsidering the number of tractors and lorries that onerate in the ruraT areas, most tinwns and villlage centers, where meins electricity is available, have at least one garage where batterv charging foilities are available. Further, lead acid batteries are manufactured in cally by two large factories and by a number of small manufacturers.
Evaluation was not confined only to secondary calls. Thevel noment winrik was carried out to produce a 7inc-Carbon (Leclanche) cell and an Aluminium-sodium hvdroxide call in kit form. The following consideratinns further prompted the selection of the lead acid battery:
(a) availability of mains electricity at, verv manv town/villa ore renters where battery charging faciltities already exist or can easily pe ins*alled, (b) fair incidence of lead acid battery wnershiro as they are used for stortino stationary enoines, vehicles ard many motorcycles, (c) breakthroughs achieved i in complementary development prOgrammes for battery charoing generators utilizing wind mills, 2 asifier driven i e. engines, and stream/mini-hydro turbines, (d) the strong likelihood of photo volataic solar panels being available at an affordable price in the near future.
Considering present lighting levels, the minimum level of lighting required for domestic purposes and the high light utilization that can be achieved by proper positioning of the light units, it was established that two six or eight watt fluorescent light units would be sufficient for an average village home. Although the average family retire to bed very early due to deficiencies of the pre
ECONOMIC -REVIEW, SEPTEMBER 1982

Page 23
శ్లో స్ట్రీ శక్తి క్షీ !
豊勢霊 -
ཕྱི་ཚོང་
3.
2
s
i
i
། *WAP )وهي مؤلم(
Ꮘ·.
పై స్క్రీశ్వk
tజనిని 1 % ጳጳጳ&﷽s& . ܕ ఒస్ట్రీష్మీ గొట్టగిరి$ يقلأندية . ܕܐܬܪܬ݁ܶܢ݈ܘܽw ܕܗܕܘܬ
sent, kerosene lamp, it is to be ex
pected that they will retire later in the night if good lighting is available. On the assumption that both light units are energised for
four hours each night, a 12 volt battery in one week will discharge a out 24 ampere hours (AH). By reference to Figure 3 Charge / Discharge Cycle Life Characteristics, it is seen that retention capacity re
12
ܕ݁ܰܒ݂ܚܰܪܬ݂ܡ݁ܪܹܬ̣ ܊
يشيلومين عيباً *ෂුද්‍රි”ද
{êêዄ ፨..
፵
3.
...ನಿ # ܪܵܕܼܒ݂ܬ݁
AAAeMMAAMMMMAAAAASAAAAAAqATMiAAASSAAAMMMMqMAA ప 3.3 2. క9 38 && s & عمل يقع ذلك يعمطامعيه لمه
i q q S S S AAAAA AA EB AAqA eA S sAAAS AAA S qqqqqqteS
గోకినాః
# Hుతా
羲
*
皂遠圭以上三針 兹 .ہے DS Bg S BEeJSDBDBz SJDSSiKY {{ { శ్రీ 蔓,穹
ألمغتيجية. أعجميعها / طبيعي معه في يمية حقية تحت
స్థిe ఉరి རུ་ཀ་གཞུང་ ༨ ༠༤:༣, ༢ ཉི་མ་ཙ༢ ༤.3b་ཐོ༢༽ స్క్రిణీ ఆణిత
economic Review SEPTEMBER 1982.
لاخلا عه ع جميع خط . ༦ 0.ཅིཙལོ་ ༢༠༼༽6 ܂ܪyܚܪܥܽܘܬ݂ དེ་ kདིའི་ wave ܘܢܙܘܬܘ همه اطله به هپتام على الأمم
duces at a faster rate discharge Cycles. If di lowed down to 40% of city, retention capacit. pected tO drop tO abou nal capacity after 300 basis of a weekly cyc. fean a Service life years. The requiremen have a battery of ca. 40 AH. The fairly co, car battery would be a The weekly charging ther advantages in th: is used to the weekly
market:S are neld in di centres On different di week. Further, the p recharging is somewh: considering that the b be transported for reci battery recharging ce Somedule their rec) when the week day forehand for each CUS the important, conside recharging duration he ger than six hours, SO lager who hands in hi the mOrning can colle battery by evening, an keep a spare battery. that a 45 AH battery {3urrent less than One Si Stain the load for I. hours. Figure 5 shows battery terminal volta indication of battery tion.
A necessary part O nical feasibility study a SSeSS Whether the technology can be a used in the country. S nology for this project and further developed country itself, the ans
 
 
 

قليدي الأسديجتمعي لم يستجينسيسنيستيم
茎。
جرزہ:
絮 چتي
s
( أي معلمي )
۳ معده و بهبود و مها resija uvstvo ర్మీ స్థితి ఎలా Aمجالمح
དང་ཙན་ཊི་
! with deeper Scharge is alcharge capay can be ex60% of Origicycles. On the e this would of about six t then is ԵO a city at least Innan On 45 AH. ideal choice. cycle has furat the villager Outine. Rural ifferent village lays of the eiCd between at acceptable attery has to harging. The ntre also can marging Work is fixed betomer. A fulirBration is that ed not be Onthat the vilis battery in 2t the charged di ke need not Figure 4 shows | dira, Wing 3. ampere, WOuld in Ore than 45 $ that the ge gives a fair charge condi
if every techshould be to manufacturing SSimilated and ince the tech
was modified within the Wer Was af
పో
ငွှိ မ္ယs: ళీ స్టీ : - ဒီဇ F.၇ శిఎట్టిశ్మీతికి * స్ట్రీ ركبه يقيده أبويهيومنعك -
క్లీఫ్కి ఫ్రీడ్డశిక్ష్కి پان{ھههه چ
ఫ్రీక్షఃశ్రీశ్రీ ** 篱 博 مجتمعناها هبط مبعثه الآلهة ميشيو جيمسة في
క్రీనా-తకి
ఫ్రీ ఫ్రీ శ వీక్షి శీర్ష్
幂 (SY. ఓఇపిస్కోని
دام ܕܲܟ݂ܚܲܪܬ݂ܬ݀ أجموعة هي محمد ܘ̄ ܟܘܛܪܕܬܐ بیٹھتA s\ \ove Yucasia and
ఉQue(ణ్యశీలాపా ఓ عهده عليه - .3 蔷 شيعية يمية جيج فيها ܢ ܕ݁ܠ ܬܬܚܬܼܛܫ ఒkసి, గిట్టగా ܬ݁ܰܘ ܪܸܟܐ̈ܠܘ ܟyܘ ܪܙ ܕܚܙܐ
firmative. Further, in this case it was possible to emulate the strategy of multinational corporations, which normally concentrate the technical expertise at their head-duarters and distribute manufacturing facilities which rely for technical assistance upon the centre. Once the developed circuit was explained and the manufacturing process demonstrated, most of the licencees very quickly became proficient in the manufacturing process. Some of them in fact introduced thier own innovations to improve the product. Now there are 32 licenced manufacturers in different parts of the country and it is hooed to increase this number to one hundred Within the next Ve 2. Jf.
Aiantini acture of lead acid batteries in the Ouantities envisaged (total potential market exceeding 2 million) is best, done in a large face tory as their production is scale sensitive and capital intensive. One of the biggest local manufacturers was happy to collaborate on the project, orice an efective method of market segmentation was worked Out.
擎
Q ܝܼܪ ܼ ܘܐs ts ܼܘ ܂ ܘܪ̈
༦.དོན་ཅན་keཅ༣༤༧, ༣༠ པའི་༽ t ”8)
".వృత్తి هوه وأخياً ܣܛܬܝܚܪܕܬ݁ܠܰ ܕܝܼܕܹG - ܠܰܢ ܢܨܝܼܬܼ ܪܵf
瑶
21
مجھے

Page 24
ECONOMRC VIABILITY Consumer Profita Eility
Since it was the objective of the project, to provide an electric light to every rural home, a market, penetration Strategy was called tor. Eench mark oricing technique was found satisfactory and easy to apply. Since even in developed countries calculation of net present value to consumer is often beyond the capability of the average householder, this technique was modified. Instead the evaluation of initial investinent and operating cost was carried out separately and without discounting. For somebody living near subsistence level payback period beyond One to two years would be meaningless.
Initial cost of kerosene lamps is
give bellOW: -
a) Bottle lamp without chimney
RS 1.50 b) lamp with glass chimney (Small) Rs. 500
f) - ditto - (large) RS. 23,G3
d) Hurricane lamp with chimney
RS. 5.0G
e) Pressure lantern with in CandeSC
ent filament (cheap make) Rs. 375.00
f) ditto - (reputed make)
RS. 800.00
Considering the above prices, the price for the electric light system consisting of two numbers 6 or 8 watt lights and a 45 AH -re-charge able battery, was bench mark priced to be somewhat less than Rupees 800. Technology development effort was therefore concentrated to reduce the Sales price of the light unit to less than Rs. 100. Resulting from the collaborating agreement reached with the local battery manufacturer it. was possible to fix the battery sales price less than Rs. 425.00. This then provided more leeway in fixing the price of the lighting unit which was given a range of Rs 100. to Rs 125. Then an installed system including two switches and wiring, should not exceed RS 750.00.
A portable inverter operated 6 watt fluorescent light imported from a far eastern country sells at Rs. 27500. This unit has facilities. Such as a spot light and a flasher utilizing separate filament bulbs.
Operation is by torch batteries Which last on jy a few hours. An 8 Watt, fluorescent light imported from Europe would cost about Rs. 225.00 for the light unit only.
Operating cost for using kerosene lamps are as follows:
Case A - Small cottage using 2 or 3 bottle lamps Rs. 11.20/ week
Case B - medium cottage using an extra chimney lamp Rs. 16.80/ week
Case C - larger cottage using a pressure lantern Rs. 33.60/ week
22
be
In actual Il U117) e}^0US Va
mix of lamp ty usage. The mini We have cone Rs. 10.00 per w
The electric
charge a, batter
A.
Initia EERVeste Scale of produc
(a) Mianufactu (b) battery ch:
Total
Working Capita
Scale of produc i) 6 watt ligh ii) 20 wat liig iii) batteries (a) component
b) Batteries
c) work in pr
Sources of Fund a) own facilit b) own mone c) overdraft II
Considering the thi
Stage a) Manufac batteries Stage b) Manufac 20 batte Stage c) Manufac teries ar
(A) Out-of-Pocket
Stag,
i. Materials ii. Employed Lat iii. Royalty Paym
V.
W.
vii. viii. 这。
(B)
i.
ii. iii.
Distribution 8 Loan interest Rent & electri Transport Batteries Taxes
Total
Sales
Light units (a
Batteries (a
Tofai Contribation to from sales of li: from battery chi from light hire
Total

ractice there would riations of the ab Owe es and hours Of mlum kerOSen e Ull Sage cross is at a cost Of ek.
l energy required to r under recommend
ed conditions is less than half kilo watt hour (KWH), the cost of which is less than Rs. 100. A locally fabricated battery charger capable Of charging 10 batteries at a time will cost about Rs. 5,000. The capital charge, if investment is recovered in 2 years, is less than Rs. 1.00 and
Figure 6-SUMMARY OF CAPETA. REQUIRED (Rs)
ioři
ring planifequipment rging facitlities ...
Requirement
tion Sales E if its ht üĩàits
s for light units in 2 batches
ogress & finished goods
$ tes
Qa፻፩
tupio 100 iunii 5 OG a 25C fișii i s
per month prе топth
3,429.50 A 1,114.00 3,000.00 5,500.00 (single unit) (2 ginits)
6,500.00 16,614.00
(a) (b) (c)
50 ! {}} 2霹 10. O G 2 20 5.G 2,000.00 4,000.00 8,000,008,000.00 8.000.00 10,000.00. kone batch) (2 batches} 3,000.00 6.000.00 12.000.00,
13,000.00 18.030'00 30,000.00
3,500.00 ܝܚ 6,000.00 ܢܚ ^_^ -- 10,000.00
19,500.00
Figure 7-MONTHLY INCOME STATEMENT
ree stages of the project
turing 50 Nos. 6/8 watt light units, 10 Nos. 20 watt ilight units, sale cf {}
and charging 5 batteries per day. turing 100 Nos. 6/8 watt light units, 10 Nos. 20 watt light units, sale of ries and charging 10 batteries per day,
turing 250 Nos. 6/8 watt units, 10 Nos. 29 watt light inits, saie of 50 batld charging 5 batteries per day.
Experises
巽 eitt z Sales
city
| 110/-) (டு 200-) ) 4101-) Oso 8 se
Cwm Recome ghts & batteries arging & sae of accessàries
(a) 钴
3,720.00 6.632.2 13,57.0g -- 600.0 1,550. GG 箕湾。鑫 6CO, CO: 1.350.00 350.00 600.00 2,600.00 160.00 7.O.O. 34{}}} 20G, GC) 4@@.奪@ 1.500.00 0000 25.00 500.00 7,500.00 7,500.00 18.750.00 335 OG 1, 84.00
12,330.00 6,932.30 41,470.80
7,500.00 13,000.00 29,500.00 8,200.00 8,200.00 20,500.00 15,700.00 21, 200oo sooooo
3,369.20 4,552.70 9,713.20 45G.●● 9000}} 1,350.00 500.00 500.00 50G.C.
4,319.20
Say Rs. 4,300/- Say Rs. 5,000 - Say Rs. 10,000
Economic REview, s:PTEARER 1982

Page 25
would be half of this if two batches porting it through : of batteries (2x10) are charged per 5 miles is not ( day. On this basis the recommend- be remembered th: ed price for recharging batteries is exist much inconv Rs. 5.00, whereas if the battery is chasing kerosene brought in the fully discharged con- to the reluctance - dition the ge:alty price is Rs. 8.50, the village shop-k KLLaLaLLLLL S S LLLLSK SaLLaaLLLLLLL S S BuDuDLGLtLYL SuuSS LLLLLLGeS SLLLLLLaL0LL0L LLLLL LLLL S naily have to pay only Rs. 5.00 per and also liable week for illumination which is of a, iOSSéS. better quality than with bottle lamps
or with enirey TiamOs.. Finna saviñigo Ü@maikmaercial Profita
in hard cash for case A would be ܗܝ Considering the Rs. 620 per week while for case B pleinentary nature it is RS 1.8G. the early Stages, th
simplified by con if the battery has to be taken portuinity costs. F to a charging centre for recharging use of a spare roc an inconvenience penalty is incur- which if not for t red. This inconvenience is greatly not generate an in reduced by having many recharging ed at nil rent valu centres, by providing a simple handle concept is the rea for transporting the battery, and an "Out-of-pocket provided the battery is securely fix- “contribution to ow. ed to the back of a bicycle, trans- main format for t
Figure 8-CASH FLOW
Year
A. Sales per month a) 6/8 watt lights
b) 20 watt lights c) Batteries
B. Investmenti a) facilities, equipment & tools
b) Working capital requirements C. income a) Contribution to own income
Cash flow
Equivalent of salary
Net cash flow into project - - - D. Reffins a) Net present value at 22% discount rate Rs
b) Internal rate of Return 128%
c) Pay back period less than 1 1/2 years.
Figure 9-BALANCE SHEET AS A
Year Capital Empioyed
a) own capital b) loan soverdraft
Fotą Fixed Assets - -
Stock & work in progress and finished goods
Debtors - - - Cash
Current Assets
Current fiabilities Net working capital
Figure 10-USES Year
Contribution to own income
Withdrawal from profit Loan repayment
Total disbursed Retained contribution Depreciation allowance
Add to capital
Note: 1. Small scale manufacturing industries making a profit less tha.
Dividendspaidotduring thisperiodarealso taxfree.
ECONOMIO REVIEW, SEPTEMBER 1982

distance of even ificult;. İ5 mm ust it there already enience in purequirements due Dn the part of :epers to stock high value item to evaporative
bility
pait-time / Supa of the project in e accounting was Sidering only Opor example, the m in the house he project would come, is considere. This important Son for adopting expenses and in income as the he income state
STATEMENT (Rs...)
ment prepared on a 22 lonthly basis.
This is a mOre Walid Criterią fOf profitability for the rural context and is better appreciated by the
rural entrepreneur than the standard formats. Preparing such monthly accounts does not frighten the budding entrepreneur and further it enables in to compare his income With the income of his contemparies most of whom are on a monthly salary.
Figure 6 gives a summary of Capital required ior the project at two scales of production, up to 100 units per month and from 100 to 250 units a month. Figure 7 gives a monthly income statement for three stages of development of the project. Figure 8 is a cashflow statement also giving the production/ sales plan. A conventional Balance sheet is given in Figure 9, and the Uses of Funds statement is given in Figure 10.
O 2 3. 4 S
50 100 250 250 250 10 10 0. 10 20 20 50 50 50 (6,500) -- - (10,000) (13,000) -- (4,000) (12,000)
- 51,6000 72,000 138,000 138,000 138,000
(19,500) 51,600 68,000 116,000 138,000 138,000 36,000 48,000 60,000 60,000 60,000
(19,500) 15,600 20,000 56,000 78,000 78,000 ... 101,626"|-
T 31ST DECEMBER (Rs.)
2 3. 4 5.
17,900 29,900 89,200 140,700 202,200
5,000 NIL 10,000 NIL NIL
22,900 29,900 99,200 140,700 202,200 4,300 2,100 6,714 3.414 量毒 13,000 18,000 30,000 30,000 30.000 NL NIL 7,500 10,000 12,500 5,600 9,800 54,986 97.286 159,586
18,600 27,800 92.486 137,286 202,086 NIEL NL N NHL NHL
18,600 27,800 92,486 137,286 202,086
DF FUNDS (Rs)
2. 3. 4. 5
51,600 67,200 124,800 124,800 124,800
36,000 48,000 60,000 60,000 60,000
5,000 5,000 --- 10,000
41.000 53,000 60,000 70,000 60,000 10,600 14,200 64,800 54,800 64,800 2,200 2,200 5,500 3,300 3,300
8,400 12,000 59,300 51,500 61,500
in Rs. 200,000 - per annum are exempt from taxation for the first 5 years
23

Page 26
Significant points to be noted 2】'登:
a) Saal industrialists in rural areas find it difficult to obtain supplier's So current liabilities are 壹星。 b) When production scale reaches 250 units per month, credit SaleS/retail outlets on a consignment basis would be necessary. c) much of the fixed assets are semiconsumables and are Written off in three years. d) by year three the entrepreneur should review progress and plan for further expansion including separate premises. There is no point in complicating the issue at the initiation stage. e) annual withdrawals from profits is a combination of salary and dividened payout. In most cases if the entrepreneur was to find alternate employment, the annual salary he can get would not exceed RS. 12,000. f) Net present value at 22% rate of return is Rs. 101,626.00. This rate COrresponds to the alternate investment in a fixed savings deposit with the National Savings Bank. g) Internal rate of return works out
to 148%. National Profitability
It has been estimated that approximately 70% of Sri Lanka's total commercial energy consumption consists of petroleum products. The relatively inelastic demand for petroleum imports and the sharp price increases effected by the OPEC resulted in absorbing 47% of Sri Lanka's total export earnings in financing the country's oil bill in 1980. The price of kerosene increased by 14.2% in 1980 and still the selling price is heavily Subsidised. The subsidy for 1982 is estimated to be Rs. 600 million. In addition to the price subsidy, the poor segments of the economy are entitled to Kerosene Stamps' vailled at Rs. 9.50 per household per ΥΥιΟΥith, issued by the Govern宣1er1t。
About 1,592,332 households received kerosene stamps at a total expenditure of R.S. 62 million in 1980. ConSumption of kerosene was 52.8 million gallons in 1980. Even assuming a rural household requires only half a gallon of kerosene per week for illurination, this accounts for 75% of national kerosene consumption. Thus kerosene consumption by rural households costs the countryRs. 1,188 million, almost all of it in foreign exchange. Potential saving from government expenditure On subsidies for kerosene to the rural
sector amounts to Rs. 612 million
per year (署x600 十 162)。 This situation presents a very exciting opportunity for a project that would eliminate the need for kerosene in rural households.
24
Given til ting half of expenditure ( viding Pra lights, storag tery charging ing items cal Year'S:
a) 800,000
b) 1,600,00 露る。 100/-
ο) 20,000 莓/-
d) Impler
Tota e
A two period is con this period 8 would be pro facilities. Wit. hOUSehOlds v and the 3 Օ: draw the ke: price subsidy.
Such an gram would employment areas itself:
a) 450 fluore erS makir and each
would be
b) 85 battery making 1 each em be requiri
c) 3 battery 12,000 bat each em be requiri c) 20,000 ba employing be requiri
Total
The 10ca. rescent lights, charges WOIC change penal cycling of tapering of C tery charger, value of the Conservative of Sales price millión för a (0,5x588). Thi
imported pric
WOԱld be Saw project
Looking a posa, ble incBEN as this will Vantages of bout, a]SO take technology crease in rur: a very impor rural develop

possibility of diver
recurrent government Rs. 612 million) to prOhakthi fluorescent
batteries and facilities, the followbe provided in two
batteries (a) R.S. 410/
RS 323 milion fluorescent lights (C)
Rs. 160 millioin attery charges (G. R.S. 5,0 ERS, 1 G0 million
expenses R.S. 24 millili OI Kpenditure
Rs. 612 millic:
entation
implementation sidered realistic. Iim. 0,000 rural families rided electric lighting in four years all rural ould be provided for Ternment could withOsene stamps and the
year
implementation prOgenerate considerable mostly in the rural
scent light manufactur
ng 150 units per month employing 3 persons
required 1,350 persons,
7 charging manufacturers 0 units per month and ploying 4 persons-would ed 340 persons
manufacturers making teries per month and ploying 50 persons-would ed 150 persons ttery charging centres a single person-would ed 20,000 persons
employment created
21,840 persons
manufacture of flu.0- batteries and battery incur a foreign exty. In five years rebattery lead and the if the demand for bat3 would reduce the imported component. A stimate would be 50% which is Rs. 294 mill tvijo year period S is only 12.5% of the e of kerosene which ed as a result of this
it the increase in dishe is also worthwhile eflect, not only adbreating employment account of product/ levelopment. Such intl purchasing power is tant criteria of real ment.
bat
a) wages, Overheads and profit from local manufacture (x3588) RS. mil. 147
b) saving effected by rural househol ds from cost of illumination
using electric lights instead of kerosene lamps
C (10-5) x52x1,600,000)
S. ni. 416
c) Net income fron. pattery char.
ging (4x52x1,600,000) RS. mi4 3328 Increase in disposable income
HRS milion 395.8 d secondary manufacturing activity and increase in indirect, employ
ment Wil also generate more disposable income, much of it in
Urai indi S.
There are numerous other direct benefits that are not easily quantifiable, yet are often very valid realsons for undertaking a project. Preoccupation with numerate methods teinds to be-little such project benefits. Some of the direct benefits resulting from the Prashakthi project are given bellOW:
a) improvement, in the quality of life
for rural households,
b) opportunity to engage in gainful employment, eg. sewing, handicrafts, etc., in the cool comfort within one's own home free from day time tasks and cares.
c) opportunity to read, study, etc., and improve one's condition.
d) it is possible to use a battery for clocks, radios, cassette players and even for Television sets, With considerable cash saving on torch batteries.
e) improved health, reduced еyе strain, reduction in danger to life and property by fire resulting from ker CSene lamp accidents.
In addition to the many direct benefits, most development, projects provide many in-direct benefitS. Sone of the important indirect benefits from the Prashakthi project are given below:
a) 00% local project from conception, R & D, demonstration and implementation; ably denonstrating advantages of technological sovereignty.
LSS GGG0LaLLLSS S 00L00LLLLS LLLLLLLLJSS S LLLL S S LL0rLLSS 00LS
du Stry,
c) dispersed nature of production and jobs in rural areas, thus arresting migration from rural to urban centres,
d) tild-up of a nucleus of technical entrepreneurs who can later take on more enterprising projects,
e) having a better light, the present generation of children will have greater opportunity to study and read. With time this Would mean better educated and intellectually more mature men and women in future generations.
EcoΝοMτα ΕΕντΈν, SEPTEMBER 1982

Page 27
RATEONAL (3RÉSDET PLAN – 1982
A credit plan covering the total commercial bank credit to the private sector has been formulated by the Central Bank for the year 1982. The Plan is an attempt to divert Scarce bank credit from leSS important Commercial purposes towards more important development purposes.
The National Credit Plan is the outCome Of a Series of diSCUSSiOmS the Central Bank has had with the commercial banks operating in the country.
The National Credit Plan of 1982 envisages a growth of Rs. 6.6 billion or 32 per cent in credit to the private sector during the year. This represents a substantial growth when compared with the growth of Rs. 3.9 billion or 23 per cent experienced in 1981. Of the growth targetted for 1982, nearly half has been allocated in respect of the priority sectors, viz., agriculture, industry, exports and tourism.
Credit for agricultural purposes has been planned to increase by Rs. 582 million or 20 per cent to Rs. 3,652 million by the end of the year. Though a temporary setback is expected in tea, and rubber production, the overall perfornance in the agricultural Sector is estimated to be at a higher level during the year and the commercial banks have agreed to provide sufficient funds for this purpose.
Credit for industrial purposes has been estimated to rise by Rs. 984 million or 20 per cent during the year. Within the industrial sector, the engineering and building trade is to absorb the bulk of the industrial credit reflecting the growing credit needs of the large scale construction activities going on in the country. Manufacturing and the textile industry, too, are the major credit users in the industrial sector.
The National Credit Plan envisages a significant growth of Rs. 1,223 million or 33 per cent in credit to the export Sector. In order to induce banks to achieve this target, the pre-shipment refinance Window of the Central Bank too, has been enhanced by Rs. 45 million to Rs. 575 million in February, 1982.
Available evidence indicates that 1982 will be a year of intensive hotel construction activity in Sri Lanka. In view of the development of the tourism sector as a major foreign exchange earner and the direct and indirect enployment created by this vital sector, tourism has been recognised as a priority sector by the Central Bank. Accordingly, credit for tourism in the Credit Plan is expected to rise by Rs. 178 million or 42 per cent curing 1982. The bulk of this credit is long term credit needed for hotel construction activities.
The Credit Plan is to be closely monitored by the Central Bank in order to ensure that the targets of the Plan are duly achieved.
Source Central Bank News Review.
ECONOMIC REVIEW, SEPTEMBER 1982
Minor Irrigation in
క్షిప్లొ Abeysinghe
Development of agriculture sector is vi nomic life of the coun
sion of Saigient wat greatest needs of this achieving this objectiv importance of restoring
ing Sri Luainkas İletWO)
翼
argues Ariya Abeysing assistant secretary in Agriculture. In this fil paper iae koks at the iMinor irrigation fro
ご
lation viv Orks has 1
perspective.
Sri Lanka's econ(
highly dependent
Which continues to b portant SectOr Of the contributes a major country's national pro exchange earnings, g venue, food supplies, and general develop
Agriculture contri ge cent of the GroSS itict, though this sec the GDP has renai Constant Over the 1970 table 1). In 1981, it 21 percent of the GD cent of the employed and 60 per cent Of
Sa Injing S. Even muc tivity in other major as anufacturing, tr. services are connected with the processing a produce from the agr: tOr,
The important pla: agriculture in the eco be observed in th budgetary allocations tOir, vyhlich as double de Cadie. As Seen in te ment in agriculture
Table 1. PERCEN
ECONOMY AND
G. D. P. from Agriculture Agricultural Employment Agricultural Exports Total Expenditure Current Expenditure Capital Expenditure Agricultural Export Taxes
Public Inve and Plannin
ՏՕգյrce:

the Agricultural Development of Sri Lanaka o
the domestic tale for the ecOLitry and provier S one of the Sector today. In
e, however, the -
g and maintainrk of minor irr
to be realised,
he who is an
the Ministry of st part of his problems of im a. historical
Dmy has been On agriculture 2 the most in
economy. It share of the }duct, foreign Overnment re
employment lelt, activitieS.
butes about 30 DOImeStic PfOtor's share Of lined virtually -81 period (See accounted for P, about 50 per labout force tot3] export h of the agsectors such an SpOrt and I in some way Ind supply Of icultural sec
à ce 3ecorded tO nomy may also e government
to this secd over the last ble 1, investna S Crea Sed
from a level of 26-30 per cent during the 1971-76 period to 35-36 per cent during the last two years; a major part of this investment being diverted to the Mahaveli Development Project.
The general performance of the economy and growth trends in the country also bear the impact of performance of the agricultural Sector. For instance, a glance of the sectoral performance in 1981 shows that the improvement in the agricultural sector, particularly in plantation export crops, had an important role to play in sustaining the growth of the economy. The agricultural sectOir, as a whole, contributed 35.5 per cent of the growth in 1981 as compared with 10.6 per cent and 5.7 per cent in 1980 and 1979, respectively. It is evident that the performance of this sector is vital for the economy particularly when we consider the progress achieved in the domestic non-plantation SectOr, especially paddy, in recent years.
The agricultural sector is the Only sector that can cushion the advese effects of stagflation” created by the slow pace of employment creation, the oversupply of
noney domestically and imported inflation after liberalization. In order to meet these challenges
there is a grave need to increase domestic production in all sectors, particularly in the agricultural Sector. Water availability through better Water USe, conservation and management of irrigation works are a fundamental factor in the process of increasing productivity domestically in the agricultural sector. Irrigation Development - the Ancient System -
Irrigation development has been tine basis of the development, of hiti:man Settlementis from early times. The whole of the ancient, Sinhalese civilization and economic growth was moulded round the development of water and land, and the naintenance and growth of village tanks. Sinhalese Water laws are an ong the oldest in human civilizati On and Over the years cuStOumary
PAGE SHARE OF THE AGRICULTURE SECTOR IN THE
IN GOVERNMENT EXPENDTURE AND REVENUE
1971
量拿穹 1979 1985 93.
29 27 28 29 53 51 50 50 78 71. 63 鑫 O 16 2 芝拿 5 7 9. O 26 36) 35 36 14 40 29 26
stment, 1982- 1986, Ministry of Finance
g, May 1982.

Page 28
practices and laws have been evolved for cOnserving Water in the village tanks. Village tank development was linked to development of the villages where the Buddhist temple was the centre of activity. The temple generally was established. On the bund or in proximity to it. The Buddhist monk in the village temple gave leadership in that he fixed auspicOus times for cultivation, first issue of Water and cultivation of the yaya on a fixed day after the Kanna meeting. Also, the flooding Of paddy fields for weed control, last date of water issue, cleaning of field channels, cleaning of bunds of jungle growth and out hills, the time of cutting the paddy, threshing of paddy in a common kamatha maintained commonly by the farmers in the yaya, the presentation of the first quantity of rice to the Sangha and Gods before human consumption, in a colourful pageant known as the “Aluth Sahal Mangalya' were common features of rural Sri Lanka in which the temple was also associated. The Kanna meeting was a community gathering of yaya farmers and they met in the temple. Once decisions Were arrived at they were generally followed to the letter. Water issues were made democratically begining With first issues to the ARAWA (Or Tail End) and gradually issues were made to the lands in proximity to the tanks. On a Bethma System. The farmers in the yaya decided on one variety of paddy to enable water management, pest control, weed control and crop protection. Though farmers owned their OWn paddy fields they followed common deciSi OinS With Out de Viati OinS.
When Water in the tank WaS limited they decided together on a method of cultivation. Draught animals were held on an individual ownership basis but were kept in the homestead as a night park and never allowed to roam about destroying channels or bunds or crop. There were points in the yaya, where cattle could cross the channels.
This system of tank-village relationship was destroyed gradually with the influx of foreign domination into the low country first with the Portugese and then the Dutch and then followed by the British who cono uered the Kandyan country. The irrigation traditions remained in Sinhalese villages in the Raia Rata, Ruhunu Rata, and Uda Rata until discrimination based On capital accumulation, politics and modern capital goods intruded into the agricultural sector. The Vel Vidalina, who was an elder farmer in the yaya, elected democratically and paid in kind by the farmers in the yaya for his service in water regulation, water issue, water control and management, was
replaced by elected formal who were paid in cash for
26
their
officials
services. A po to farmer lea. and caste dist an important the place of t the village lea lationship wit tegrated. The was the source and managed gradually repl. Schools where done by paid, had n0 Perma villages. The temple, which library of the and kept close the people beg: by the popular draught anima placed by Draught anima nore to the beef was in g. plants grown and used as O gan to be repla mical fertilizer features of the the traditional lages and th, neglect over ti Ancient hi. gation develo earliest times tiOnS. There as the Duvegal Scription of Lar recording the g and of an irri monastery (Vid and Literary R. 1918 pp. 204-5;
Accepted tI tion practices, tion time table centuriƏS and hered to. The common denOC SiOn making p ti OinS and pract lowed for the dually deterior: Of Para krama When con Serva ment Was the of plenty. The followed saw decay. Deve probably conf ance WOrk in cities of Dam Kur’Unegala, ar The pOS With the arriv (1505-1656) wl Lanka's agricu to cinnamon. in Sri Lanka, 1656 AD, unlik paid much at agricultural Of lands were riculture and 1666 prohibited tenants of pad them un cultiv:

pical tint was given rs. Local politics nctions began to be actor. Officials took Buddhist priest as Sr The farmers rethe temple disinillage pirivena which of education, taught by the monks, Was 2ed by Government the teaching Was ay professionals who ent interest in the Poth Gulla.” Of the was the COMO Il village was ignored to the village and in to be influenced printed media. The was gradually reechanical devices. ls found their Way irban centres where eat demand. Green in the “Goda-Idan' 'ganic fertilizer beced by imported che3. These Were SOM le decay that set into life of the tank-vil
se tanks fell into (11e.
story records irripment frOIMI the in various inscrip
is evidence as early a, and Na-Ulpota, inhija tissa (119-109 B.C.) rant of tracts of land gation reserve for a e: Ceylon Antiouary egister Vol: III Pt. 3,
ΕΖ Vol. 1 ρ 148) aditions and cultivaincluding cultivais were built up Over these had to be adwhole village had a ratic say in the decirocess. These tradiices which were folcommon welfare gra
ated, after the time oahu I (1153-1186) tion and develop
keynote to the path three centuries that he beginning of the opment activity was ned to the maintenproximity to capital adeniya, YapahuWa, d Gampola. tion did not change all of the Portuguese ose interest in Sri ture was limited Only The Dutch, who were for 150 years from e their predecessors entiOn to domestic levelopment. Grants freely made for agegulations passed in owner cultivator/ dy fields from leaving ted. Another Order
in 1744 announced seizure of , such uncultivated lands which were to be given to more diligent cultivators. The Dutch found it worth their while encouraging agriculture in the low country areas and assisted this with costly undertakings by constructing and restoring of engineering WOrks. Minor Irrigation Under the British
The British, who took command of the Maritime areas by 1798, extended their domain to the entire island in 1815. Progress in the development of water resources during the one and half centuries of British domination took place on the initiative Of Some Governors of the time, the efforts of the Central irrigation Board and the Provincial Boards, and the Irrigation L)epartment. One of the important changes that affected the communal machinery of tank maintenance of ancient times was the removal of the Rajakariya system in 1832. No alternative system was introduced for maintenance and repair of tanks by the community. Maintenance and upkeep of communal water and conservation work was no longer the responsibility of any individual Or group and the minor and major irrigation works only fell into neglect and general decay. This Was possibly another factor in the destruction of the traditional system Of village tankS.
The Governor, Sir Hercules Robin Son (1865-1872) embarked On development activity on a large Scale. He passed a famous Paddy Cultivation Ordinance. The period under Robinson saw the reconstruction and restoration of four schemes (Kekandura Tank, Hali Ela, Tank, Tissamaharama Tank and UdukiriWella). In the Southern province, four Schemes in North Western PrOvince (Deduru Oya, Scheme, KOspotu Oya, Scheme, Tinipitiwewa and Wennoruwewa) three schemes in Uva (Horaborawewa, Buttala. Ela, Kuda wewa) and three schemes in the Eastern Province (Periyakulam, Rugam Tank Pulukanavalkulam). There Were twenty five Other village works undertaken. The total expenditure was Rs. 1,050,000. His successor, Sir William Gregory, was ecually keen and the tempo of development was nearly doubled and a large number of minor irrigation works were restored. He wanted “at
least 100 village tanks be properly repaired each year'
Sir Arthur Gordon revitalized
irrigation development and kindled enthusiasm which had worn Out With the departure of Gregory. In Six years he caused 42 tanks and 164 sluices to be repaired at a cost of Rs. 3 million. Of the major irrigation works restored Kalawewa. stands out and it cost Rs. 405,095 to restore. The restoration of Kalawewa. YOda Ela (Old Jaya, Gallinga) WaS undertaken in 1889 at a cost of Rs.
ECONOMIC REVIEW, SEPTEMBER 1982

Page 29
304,484. Simultaneously, village tanks in the city of Anuradhapura, Nuwara Eliya, Tissa Wewa and Ba
· sawakkulama were also restored.
In 1887 an Ordinance was passed creating a Central Irrigation Board With the Governor as President for the general management and promotion of irrigation. Provincial Boards were established with the respective Government Agents Of the area aS Presidents and they were entrusted With the execution of all works in their areas. By 1889, 59 large tanks, 2,250 minor tanks, 245 anicuts, and 700 miles of channels were restored. A new irrigation manual published on March 18, 1889 defined responsibility for the maintenance of irrigation WOfKS.
May 15, 1900 marks the birth of a separate Irrigation Department under H. T. S. Ward, as its first Director. All SurVeyS, and COClStructiOn. of new works, restoration and maintenace of major schemes were the responsibility of this Department. Now Government Agents (after the abolition of PrOvincial Boards) were given the function of maintenance of minor works carried out by the villagers themSe VeS.
The period which spotlighted the potential of the minor irrigation works begins in 1923. The railway disaster of 1923 forcibly directed attention to the potential danger of floods from every village tank lying above the railway. Hence, it was decided that the Irrigation Depart
ment should fully investigate the safety of every village tank between Polgahawela, Mannar and
Jaffna. 354 village tanks were investigated by a British firm, namely Messrs Emerson and Bidell; this WOrk was subsequently completed by Mr. . S. Kennedy who later became DirectOr Of Irrigation The investigation spotlighted the great potential of the development of minor irrigation Works. Hence, the scope of the investigation was accordingly extended and for the first time data. On village minor irrigation works were collected and collated On a scientific basis and the foundation for a systematic study fΟΥ their scientific development was established.
A new emphasis came to be placed on development of settlements, based on restored irrigation Works in the Dry Zone, after the
Nimalaria epidemic in the 1930's. Pea
sants were resettled in what were called major colonization Schemes. A new irrigation policy was also enuncated by the then Minister of Agriculture and Lands Mr. D. S. Senanayake in 1932, whereby the function of improvements to minor irrigation works was transferred back again to the Irrigation Department from the Government Agents. The policy of the Minister
ECONOMIC REVIEW, SEPTEMBER 1982
Was Summed up i. words, "For the prod and the development dustry th ecountry sł to the latent possibil numerable village WC the island'. A sum of voted for the impro lage irrigatiOm WOrks village works division the Irrigation Depart Programmes im) the Irrigation Depart around the proper minor irrigation WOr tamatic maintenanca Sues; and also On f The Irrigation Depart a programme towar( protection which pre Ganga floOd Waters lying adjoining basin: termined flOOd heig "level of flood protec policy Was not exclus for the benefit of t where water shortage CØIn Straint tO the grO CultiVatiOn. ThiS dire the need for minor development if an ex vement and extension tivation was to take In 1939, rules and the execution of irriga adopted which define gation WOrk as “th OS which the land hold a general rule, pay carry Out the earth W clearing, necessary Struction and maint { Or Whole'. World Wa: any way affect the d irrigation WOrk. The ported food were cut War and this provide to achieve Self-suffici The emphasis, howeve cultivation of a variet food crops, including grain crops like maiz types of yams. The II WaS COinSidered in Suff Struction of tanks an tems though land cc taking place. July 1 birth of the foOd pri which also hastened maintain and restOre and use irrigation w: Post-Independence P. With the grant of pendence in 1948 the be a pre-Occupation ( With ecOn Omic eman the land and agricul of the Ministry of A Land S. Seemed tO ble ( end.
Around 1947 Work the Gall Oya Multi lopment Project, moc Tennessee Valley Aut in the USA. The ulti neglect Of resources project of this natur out by an evaluatic

in the following ucing of paddy of the rice inhould look more ities of the inrks throughout Rs... 200,000 was vement of viland a special was set up in ment. plemented by ment centered utilization of ks through sys2 and Water iSLood protection. tment launched is minor flood vented Kelani inundating low s upto a predeht called the tion'. Irrigation sively directed he Dry Zone, was the main with of paddy w attention to irrigation work tensive improOf paddy culplace. procedures for tion work were ed village irrie Works under ters do not as any rate but fork and jungle for their con2nance, in part r II did not in evelopment of Sources Of imoff during the !d an impetus ency in food. r, was on the y of subsidiary non-irrigated e and many new land policy ÎCient for COndi channel SySDlOniSatiO Wa:S 945 saw the bduction drive the need to
village tanks alters better. eriod
political indere appeared to f Governments cipation; and Ltural policies griculture and irected to this
was started On PurpOSe Deveelled on the hority project mate folly and in a massive 'e was brought committee
which was appointed by the Ministry of Land, Irrigation and Power in 1966. This project had it’s origins in the mid 30's when the then Director of Irrigation, Kennedy, influenced by the TVA Walley Project in the USA, identified a site for a large reservoir on the Gal Oya river at Inginiyagala in the Eastern Province. This was a major departure from the earlier practice of irrigation development which was largely based on restoration of ancient irrigation systems in the Dry Zone, ranging from Small village tanks to large reservoirs.
The Gal Oya multipurpose major irrigation scheme inaugurated O. 18th August, 1949 got far more attention than all other schemes and the issues that have been raised as a result of this policy have proved that the existing irrigation systems and works were the type best Suited to the country.
The maintenance of minor irrigation works became the responsibility of the Ministry of Agriculture and Food. The first six year programme drawn up for irrigation development between the years 1947/48 and 1952/53 was part of the post War programme of Work Which cOncentrated on 16 major Schemes and gave an increinent acreage of 81,912 acres of new land for cultivation. With the completion of the first six year programme 113 miles of tank bunds, 54 miles of flood bunds, 1,267 miles Of channels, 363 miles Of irrigation access roads, and 634 buildings were completed. These in turn gave an effective irrigation acreage of 271,433 under major schemes and 412,350 acres under minor irrigati On Schemes. Minor Irrigation
With the change of government in 1956 the Minister of Irrigation and Lands Mr. C. P. de Silva showed special interest in Dry Zone irrigation and took steps to develop mostly major schemes. His predecessor Mr. P. Bulan kullama DiSawa as the Minister of Agriculture and Lands had concentrated on tank development in the Rajarata. The tragic floods of 1957 breached a large number of major ancient reservoirs in the country, when serious damage was caused to 35 major and 1,300 minor tanks in Sri Lanka. With the passage of the Paddy Lands Act of 1958 under late Mr. Phillip Gunawardane and the establishment of the Agrarian Services Department, Minor Irrigation once again became important. The Paddy Lands Act of 1958 was introduced to provide Security of tenure to the tenant cultivator who otherwise was reluctant to improve the land Or adopt cultural practices which would bring in higher yields. The eW Act made tenancy a heritable right and established about 4,000 cultivation committees at village level. These cultivation committees were
27

Page 30
elected by farmers from among themselves. The new act enforced in six districts in 1958 was extended to 22 districts by 1963. This village level Planning and Implementation body had amongst several duties such functions as preparation and maintenance of registers of paddy lands, fixing of wage rates of agricultural labour, adopting steps for the development and maintenance of irrigation works, efficient cultivation of paddy lands and the maintenance of their fertility. The Agrarian Services Department was vested with construction, surveying, investigation as Well as maintenance of minor village works. They had adequate technical Staff and annually spent about Rs. 4 million in effecting such repairs and improvements to minor irrigation WOrkS. In the agricultural development proposals of the Ministry of Agriculture and Food for 1966/1970, the Agrarian Services Department had an annual expenditure programme of Rs. 10 million for minor irrigation works. With the passage of the Agricultural Productivity Laws and the Agricultural Lands Laws the construction, investigation and surveying was given back to the Irrigation Department
and maintenance of village tanks were once again neglected.
The Agricultural Productivity
Law, No. 2 of 1972 provided powers
to Agricultural Productivity Committees to set standards of good management under Section 3 (1)
and (2) of this Act. According to this Act the owner or occupier of any agricultural land had to ensure "irrigation water is efficiently managed' and that “maintenance and repair work is carried out'. Moreover, the owner or occupier of any agricultural land had to take necessary steps to ensure “the proper timing of agricultural operations', the “efficient management of irrigation water', and “water conservation and drainage'. Section 5 provided for the Occupier of agricultural land not owned by him, to undertake any work of maintenance or repair which the Owner was respOnsible to carry out. The period when minor irrigation work was under agrict ltural productivity committees. under the irrigation Department, saw certain neglect of the works. The reasons for this were:
(a) The replacement of cultivation committees with Agricultural PrO
ductivity Committees, The Cultivation Committees were elected by the farmers at village
level and the APCS Were elected for a bigger area - agricultural productivity area - hence, the close link between cultivators and their planning and implementation body were disrupted;
28
(b) Appointm
ARPC’S OI not elected were ther tatives of
(c) Political p
(d) Lack of a water use ment;
(e) The Scrap water in *Wel Vida over the S
(f) - The minin
Services COinnected
(g) The non-a the de-cer.
1974;
The Agraria
of 1979 revived Department and tenance of minC wested in the D ernment decidie
(a) Investigat.
Struction Work with low 200 a. be there rigation I (b) Maintenar.
tion work of the Ag
ment;
(c) Minor irri where the low 200 a works exc jects, as V and salt v
Under the 4,500 cultivation ted Wel Vidane appointed. Nea vices centres by a divisiona centre to have cultural perSOn partments; W. planting mater. implements inc to be stocked a rarian Services 8 local Official ricultural deve farmer represe A.S.C. area of there are neal representatives Centres.
The Agrari 58 of 1979 en Water admin agement. Wat the Act (Secti following fun
a. Holding of
time; Proper tim
c. Enforceme
customs af

at of members to political grounds and by the farmers. These fore, bodies representhe farmerS;
tronage;
proper policy regarding and water manage
bing of the traditional anager of the yaya. na” who had command aya farmerS;
tizing of the Agrarian Department's functions with minor irrigation; location of funds from tralised budgets from
in Services Act No. 59 the Agrarian Services once again mall r irrigation work was epartment. The GOV
that: on, design and conf all minor irrigation a command area, betres should continue to isponsibility of the IrDepartment;
Lce of all minor irrigato be the responsibility rarian Services Depart
gation works are those irrigated extent is becres. Minor irrigation lude lift irrigation provell as special projects water exclusion schemes.
Agrarian Services Act officers and an elecfor each yaya, Were rly 500 - Agrarian Seri were to be manned officer and each a Rural Bank, agrinel from various dehile agro-chemicals, ial and Seeds, agrOluding SprayerS Were at a Centre. The AgCommittee to have s connected with ag. opment and 6 elected entatives frOnn the authority. At present y 14,175 such elected
nominated to ASC
ian Services Act No. sures provisions for iStration and mall
er management under on 42 (1)) covers the ction S:
* Kanna, meetings n
ing of paddy cultivation;
it of such established fecting wastage and pro
per timing of agricultural operation works;
d. Efficient management
tion;
e. Joint measures for conservation of
soil;
f. Protection against pest and
easeS
g. Prevention of trespass by animals;
h. Any other responsibility imposed on cultivators on the agricultural lands for the use of such lands and the improvement of productivity. -
In 1979 the Agrarian Services Department spent Rs. 9.6 million and in 1980 Rs. 25 million on maintenance work of minor irrigation. In 1981 Rs. 21 million was spent on minor irrigation and in 1982 about Rs. 30 million was been allocated for minor irrigation. A National Committee on Rehabilitation of Village Tanks in Lanka has also been appointed صحيسيه : 638 :
of irriga
dis
A. Co-ordination of all minor irriga
lion programmes, n. Rationalising the resources used in the planning and implementation of such programmes,
c. Preparation of a medium term pro
gramme for 1980/84,
d. Procuring local and foreign funds,
Analysis of the growth and development of minor irrigation in Sri Lanka makes it evident that there has not been a consistency in the policy towards minor irrigation schemes. Responsibility has shifted from one institution to another. Their importance has been felt Only when the need to increase food production has arisen. Various measures by the formulation and the implementation of formal laws has disrupted the democratic relationships that brought together the farmers in the yayas. The water manager in the yaya, a position that evolved with years of experience, has been eliminated and attempts at various alternatives have not been successful. Traditions and CStoms connected with the ancient water laws have been destroyed or allowed to die to be replaced by new imported water laws which either take time to get accepted or which need regular review due to their being unsuited to the socio-political framework of rural Sri Lanka. Another reason for the present condition has been frequent changes in agrarian laws in Šri Lanka. Between 1947 to e date there have been four Agrarian Laws, leading to confusion among the peasantry. As a result of all these factors, minor irrigation and water administration and management has been allowed to fall into neglect.
To be continued.
ECONOMIC REVIEW, SEPTEMBER 1982

Page 31
MBER 22 1947
supporters on their way to an election acettas.
or the b-' of a స్ట్ శీ శ్రీ శిష్టజీtat శిష్ట ہوئے ڈi = * ڈوة
జీ శిక్ష * @g Ba o AÅse saĝa?
Typical of this situation was the coverage by th the first general elections 35 years ago. As sl
these pages the leading morning English daily, Daily News', for its election coverage had only ected outside the Registrar pictures at two counting centres and of two o
E. in the Colombo individual victories. The display, how ver, was l'on pleture. Pare 7). prominent. By 1977 the picture had changed con
The media in turn re. flects closely the hightened political awareness and discussion that is now so closely knit into Sri Lankan Society. In influencing and expressing this tendency it makes an election the main issue for coverage Several Weeks before and after the event. - *卧激&甲、扈穹磁° The scene has chang
為貽 鹽陶 鱲廳數為" 為爵爵為感 ed as the pictures on these two pages reveal.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

-مهمتهمتوبته
ÎN AUDE BIR CĂg-o v0E
వీటి క్రైస్వీక్వీపక్ష ఓ
Le media ΩOWY OI}
“Ceylon y these f major not very npletely.

Page 32
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