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Selling Oil, motor racing and moving from Shell to Reckitt and Colman

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After a successful race meet

Excerpted from the memoirs of
Lalith de Mel

His first real job was with the Shell Company of Ceylon Ltd. Which her joined at age 22. The Research Economist role at the Coconut Research Institute was almost a continuation of life at Cambridge. Academic research at one’s own pace was close to preparing a piece of work for the supervisor.

Shell was a proper job. He had a boss, and he had to accomplish whatever his boss wanted him to do in an industry and in activity that was far removed from Economics. It was new territory, marketing petroleum products. It was his first encounter with petroleum and his first encounter with marketing, but he settled easily into the world of commerce.

His first role at Shell was working directly for the Head of Marketing as his Personal Assistant. He was an experienced petroleum man and a rather unfriendly Egyptian national. His core role for Lalith was having him prepare feasibility studies on building new filling stations.

Shell worked a half day on Saturdays, and Mike Khoury (that was his name) would give him an assignment around 11 a.m. and insist that he gets the report the same day. He did this regularly and justified it by saying that it was only on Saturday afternoons that he had the time to study investment projects. Lalith grudgingly says that this was probably true.

After his stint as a PA he was given responsibility for marketing kerosene and reporting to an Iraqi national. The man was happy to not exert himself unduly and probe the rural markets and to leave it all to Lalith. He was pleased that as a 22-year-old he was virtually responsible for marketing kerosene, which was perceived as a product with good growth potential. It was the main source of lighting in rural areas and the task was to persuade housewives to move from firewood to kerosene for cooking.

He enjoyed the opportunity of traveling all over the rural areas. It was perhaps this understanding of rural areas that has triggered his firm belief in the need to develop rural areas, on which theme he has written many articles.

From kerosene, he became a part of the Retail Marketing team. That was the engine room that drove sales of Shell products. Shell was one of the key retailers of petroleum products worldwide. The main competitors globally were equally big boys. Market share varied. The way Shell International ensured consistency in approach across the world was by having detailed process manuals for all parts of the marketing mix. The local companies had to develop their campaigns within the lines set by the process manuals. It was a wonderful course in structured marketing. He says it was like doing a marketing degree and freely admits that he learned his marketing at Shell.

After a few years, he was moved to the Finance Division. He had twin roles. In addition to carrying out a normal accounting function, he worked in the special unit created to study the options for formulating claims for compensation for assets that were taken over by the Government when Shell and the other oil companies were partly nationalized. He quickly became head of this unit and his last role was in putting together the claims for compensation on the agreed format, signing on behalf of Shell and submitting the claims to the Government.

Shell was keen that he should continue his lectures at Aquinas, and he continued to teach students studying for the BSc London University Economics degree in the evenings.

Outside work, Shell was a fun place. It had an excellent sports ground. He got into the cricket team that was in the A division of the Mercantile league. He also played badminton and hockey in the inter-firm tournaments. Shell took a keen interest in motor racing. The objective was to get the top drivers to use Shell petrol and Shell oil. Dudley Perera, a very Senior Manager at the time, was the link man between Shell and motor racing and Lalith became his assistant.

The atmosphere at motor race meets, the roar from the cars, the smell of burning oil and the vibes from screeching tyres got to him and he started motor racing. He drove a red MGA with the distinctive number plate I SRI 5555. He raced for many years and had his share of wins both at Katukurunda and the Mahagastota Hill Climb in Nuwara Eliya. In one event at Katukurunda, he raced with Upali Wijewardene, his Cambridge University friend and subsequent famous entrepreneur, and Asoka Gopallawa, the son of the Governor General, all driving MGAs.

How Shell plans management succession

“After five years at Shell, I felt the urge to move on. There was uncertainty about the future, with partial nationalization of the petroleum industry. The exciting future appeared to be in the new foreign investments to set up the manufacturing industry.

When I sent in my resignation, I was summoned by the General Manager, a Dutchman named Jan Van Reeven. He did not want me to go as they had identified me as a potential International General Manager. I probably had a bemused expression on my face and so Van Reeven said, `Let me explain.’ He said that Shell had over 100 operating companies around the world and they had 100 General Managers, some would move to other companies, some would get fired and the rest would eventually retire at some stage in the future. So he said it was a continuous process in Shell companies to identify potential future General Managers and to develop suitable career paths for them that would eventually lead to a General Manager post in the future.

The process, he explained, was for operating Shell companies to seek and recruit outstanding persons as management trainees from time to time. The new trainee’s first job is to work for one of the directors as a Personal Assistant. At the end of this period, an early call is made as to whether the person is a potential future GM. If the answer is yes, the trainee is given a challenging career path and reassessed at the end of each year.

`As your preferred path was Marketing, you were given various marketing roles,’ Van Reeven explained. After three years the Shell approach was to test the trainee in a different discipline. “That’s why you were transferred to Finance as an Accountant.’ He then said: ‘After five years, we were convinced you would be a future GM and our development plan is to transfer you to the international pool as an employee of Shell International and transfer you to a Shell Company overseas.’

I was having a great social life in Colombo and had no desire to go and work abroad. 1 thanked him for the excellent training I had at Shell and said all the appropriate nice things about Shell and Van Reeven and then said I was firmly committed to pursuing a Marketing career in a consumer goods company. He was very gracious and wished me well and as I got up to leave he said, ‘Someone I know is setting up a multinational manufacturing company and he wants a marketing man; would you like to meet him?’ I said yes and he sent me to meet Alex Alexander, the Managing Director of Reckitt & Colman of Ceylon, who was setting up the business. He offered me the Marketing Manager role. I accepted, and that was the start of my journey with Reckitt & Colman.”

He was marketing manager of Reckitts at age 27 and a director of that company at 29-years.

Shell always had a big advertising budget. Their agency was Grants, then headed by Reggie Candappa and his assistant was Anandatissa de Alwis, who later became Minister of State and the Speaker. Later on in life he started his own agency, De Alwis Advertising. Lalith said: “They both became good lifelong friends. I signed them on and they became our advertising agents at Reckitt & Colman. They deserve a good part of the credit for the excellent sales performance of the string of brands we launched.”

The first Marketing Manager of Reckitt & Colman of Ceylon was Michael Morris. He had been with the Indian business for a few years and came to help to set up the new business in Sri Lanka. He was in Sri Lanka for a relatively short period; he decided to go back to the UK as his wife was a doctor and wanted to go back into medical practice. This created the vacancy for which he was recruited. Morris later became a Member of the British Parliament and Deputy Speaker and was then ennobled to become Lord Naseby. He was recently in the news about war crimes in Sri Lanka. He continues to be a good friend.

Two Englishmen had been sent to start the business, Alex Alexander as Managing Director and Peter Crisp as Factory Manager. All the hard work was at the manufacturing end. Disprin was being manufactured for the first time outside the UK. A whole host of previously imported products were progressively locally manufactured.

The excitement of getting a job as a Marketing Manager of consumer products in a multinational company was short-lived. He soon felt it was a well-paid non-job with nothing to do by afternoon. The Reckitt’s products were distributed by E.B. Creasy & Co. and the Goya range by Lalvani Brothers; the advertisements were sent from the UK. All the advertisements were ones used by the group in the UK. All he had to do was send them to the advertising agency.

Basil Reckitt on a visit to Sri Lanka, with Lalith de Mel at an evening reception

After a few months he assessed the scene and made his move. It was brave, reckless or foolish. He had never marketed any consumer products, knew nothing about the Pettah wholesale market which controlled 50% of sales and had never managed a sales force. He was good with numbers and knew how to put together convincing project proposals (learnt the hard way at Shell).

He formulated a proposal to terminate the distribution agreements, to set up his own marketing office and to recruit a sales force, a product manager and an advertising manager. In his proposal, he demonstrated that the commissions paid to the two distributors would more than cover the cost and in fact make a significant contribution to profits. The MD Alexander was impressed with the proposal and bought into the idea. He had just asked one question: “Are you sure you can do it?” When Lalith said “yes,” Alexander had said, “Okay, go and do it.”

He did not quite know how he was going to do it. There were many things he had not done before but he was certain that he could do them. As subsequent events will show, this was a trait he carried right through his life. He persuaded Terrence de Silva who had worked for him at Shell to join him as the Manager for everything – HR, admin, credit control, managing the fleet of vans, etc. Terrence was with him as a part of the team until he left for England. Terrence was the engine room of the Marketing division and kept everything running smoothly, whilst he launched and developed a great basket of products.

They had an amazing array of products, such as Disprin, Dettol, Brasso, Silvo, Robin Blue, Harpic, Mansion polish, Cobra shoe polish and the Goya range of fragrance products such as perfumes, colognes, talc and soap. One by one they were rolled on to the market and it was a great challenging time for him.

Fortunately it all worked out well, the sales grew, there were no bad debts, which was always a risk with the Pettah wholesale market, the profits grew and the business was highly successful and profitable. The overseas investors were pleased.

Basil Reckitt’s visit

There is a story that must be told. Basil Reckitt, the Chairman of Reckitt & Colman UK, came for the formal opening, which was also attended by Prime Minister Sirimavo Bandaranaike, as it was the first major foreign investment in Sri Lanka during her tenure as the Prime Minister.

They were seated next to each other and chatting and she asked Basil Reckitt whether there was anything that she could do and he said, “Please could we have a telephone?” Those were the days when it was impossible to get a telephone. When Lalith became the Chairman of Sri Lanka Telecom later on, his objective was to make sure that anybody who wanted a telephone would get one within a week and by the time he left his role this objective had been achieved.

Marriage

In 1966, whilst he was busy building the business, he also got married. His wife was then an undergraduate at the University of Colombo and she had to continue her studies to complete her degree. After she graduated, she started working in the university itself Since she was studying, they did not have a much of social life in the evenings, so he thought it would be useful to do some studying himself and he started studying Accountancy. He completed the intermediate exams of Cost and Works Accountants, the precursor of CIMA, and also did the exams to become an Associate of the Institute of Book Keepers. When his wife graduated and was no longer poring over books in the evening, he stopped his studies. However what he had learned proved to be very helpful as it helped him to develop a good understanding of finance and accounting.

Managing Directors

Alex Alexander moved on to another part of the Group and was followed by Mark Foster, who was also a Cambridge graduate. When Mark moved on, he was followed by Greg Courtier, who became his third British boss. He did not resent this as that was the style back then, where all foreign firms had a foreigner as the Managing Director.

He was asked to say something in his own words about his key achievements and his relationship with his foreign bosses during this period. Multinationals controlled their businesses from Head Office. The local Managing Director reported to a Regional Director at Corporate Headquarters. There were very specific guidelines on what required approval from HQ

“All advertisements were sent from the UK. For the local language press we had to translate the English ads. After my spell at Shell, I appreciated that multinationals wanted to preserve the brand footprint and have the same consistent message all over the world. The challenge was to wriggle some freedom within this constraint in order to create better advertising that was more relevant in the context of the local market. After a long exchange of correspondence, I succeeded in getting approval to create our own ads.

I had to stay within the parameters of the global branding footprint but was given freedom on how to convey this in local media. We were probably the first Reckit’s market in the Commonwealth to win

this concession. I also got approval to shift the positioning of Dettol from solely a treatment for cuts and wounds to a personal care product that prevented infection. I pursued this right through my career and created a mega global brand in developing countries that is still growing. Dettol is

amazing marketing story as nobody has seen germs or seen Dettol kill germs, but were made to believe that it did provide protection from germs.Both Mark Foster and Greg Courtier were marketers, but they knew nothing about how to market and advertise products in Ceylon. They thought it prudent not to interfere with me and I had the freedom to operate in effect without a boss in the Colombo office whilst the MD worked out of the factory and office at Ratmalana. The challenge in a multinational is getting this freedom.

The wedding retinue, with Bestman Upali Wijewardene

The UK office was pleased with the results and naturally the MD got the credit for the good sales and profits growth. I made no claims for any credit from our lords and masters in the UK for the good results. When the Head Office staff visited the business, I made it a point to say as many times as possible how much I enjoyed working with Mark/ Greg and said I greatly valued their guidance. It was true I enjoyed working with them because they did not interfere. As for guidance it was not true, and they were not really able to provide any meaningful guidance.

But strategically it was a good thing to say, so this led to a good partnership with the Managing Director. Not getting the credit and warm congratulations from the parent company was a small price to pay for having complete freedom. I steered well clear of the pitfall of trying to get plaudits for the company performance from the overseas owners and getting into a competition for praise with the boss and thereby having a not-so-congenial relationship with him.

I had a gut feeling that payback time would come. They were possibly slightly embarrassed to take the credit for my sales and profits results and had to do something to acknowledge my contribution. They recommended that I be made a Director of the Ceylon Company, which was a public quoted company.

I was pleased and content. That was as far as one’s aspirations went in those days, to become a director of a local multinational company. There was no ambition to go any further, because less foreign firms were likely to always have a foreigner as the head of their business.

The Government formed a new company named Consolidated Exports and it came to be called Consolexpo. This was a joint public sector-private sector partnership to generate and support the growth of exports. I was flattered and pleased when I was invited to join the Board. This was my first experience with the Government sector. It was also my first Board appointment outside Reckitt & Colman, so I count this as one of my achievements during this period.

Then one day a visiting director from the parent company called me in for a chat. He said they had been following my progress and were pleased with what they saw. He said almost casually that I might have the chance of being the first Sri Lankan Managing Director, but added in the same breath that I would have to prove myself in another market. I impulsively asked whether I could be sent to Australia. Half my vintage Josephian rugger team and all my Burgher school friends had migrated to Melbourne. I thought if I had a spell in Australia I could have a whale of a time with my old buddies.

The visiting Director said, ‘We will let you know in due course’ and eventually they told me that they had decided I should go and work in Brazil as a member of the management team of that company. That was their biggest business in South America and it was a huge market. Brazil was five times the size of India.



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Minds and Memories picturing 65 years of Sri Lankan Politics and Society

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Group Photo at the Celebration of Life for Kumar David

Last week I made mention of a gathering in Colombo to remember Kumar David, who passed away last October, as Comrade, Professor and Friend. The event was held on Saturday, April 5th, a day of double significance, first as the anniversary of the JVP insurrection on 5th April 1971, and now the occasion of the official welcome extended to visiting Indian Prime Narendra Modi by the still new JVP-NPP government. The venue was the Ecumenical Institute for Study and Dialogue (EISD) on Havelock Road, which has long been a forum for dialogues and discussions of topics ranging from religious ecumenism, Liberation Theology and Marxist politics. Those who gathered to remember Kumar were also drawn from many overlapping social, academic, professional and political circles that intersected Kumar’s life and work at multiple points. Temporally and collectively, the gathering spanned over six decades in the evolution of post-independence Sri Lanka – its politics, society and the economy.

Several spoke and recalled memories, and their contributions covered from what many of us have experienced as Sri Lankans from the early 1960s to the first two and a half decades of the 21st century. The task of moderating the discussion fell to Prof. Vijaya Kumar, Emeritus Professor of Chemistry at Peradeniya, who was a longtime friend of Kumar David at the university and a political comrade in the LSSP – especially in the Party’s educational and publication activities.

Vijaya Kumar recalled Kumar David’s contributions not only to Marxist politics but also to the popularization of Science that became a feature in several of KD’s weekly contributions to the Sunday Island and the Colombo Telegraph. Marshal Fernando, former and longtime Director of the EISD welcomed the participants and spoke of Kumar David’s many interactions with the Institute and his unflinching offer of support and advice to its activities. EISD’s current Director, Fr. Jayanath Panditharatne and his staff were extremely helpful.

Rohini David, Kumar’s wife of over 50 years, flew in specially for the occasion from Los Angeles and spoke glowingly of Kumar’s personal life as a husband and a father, and of his generosity for causes that he was committed to, not only political, but also, and more importantly, educational. An interesting nugget revealed by Rohini is the little known fact that Kumar David was actually baptized twice – possibly as a Roman Catholic on his father’s side, and as an Anglican on his mother’s side. Yet he grew to see an altogether different light in all of his adult life. Kumar’s father was Magistrate BGS David, and his maternal grandfather was a District Judge, James Joseph.

Kumar had an early introduction to politics as a result of his exposure to some of the political preparations for the Great Hartal of 1953. Kumar was 12 years old then, and the conduit was his step-father, Lloyd de Silva an LSSPer who was close to the Party’s frontline leaders. From a very young age, Kumar became familiar with all the leaders and intellectuals of the LSSP. Lloyd was known for his sharp wit and cutting polemics. One of my favourite lines is his characterization of Bala Tampoe as a “Lone Ranger in the Mass Movement.” Lloyd’s polemics may have rubbed on Kumar’s impressionable mind, but the more enduring effect came from Lloyd’s good collection of Marxist books that Kumar self-admittedly devoured as much as he could as a teenager and an undergraduate.

Electric Power and Politics

Early accounts of Kumar’s public persona came from Chris Ratnayake, Prof. Sivasegaram and Dr. K. Vigneswaran, all Kumar’s contemporaries at the Engineering Faculty that was then located in Colombo. From their university days in the early 1960s, until now, they have witnessed, been a part of and made their own contributions to politics and society in Sri Lanka. Chris, a former CEB and World Bank Electrical Engineer, was part of the Trotskyite LSSP nucleus in the Engineering Faculty, along with Bernard Wijedoru, Kumar David, Sivaguru Ganesan, MWW Dharmawardana, Wickramabahu Karunaratne and Chris Rodrigo. Of that group only Chris and MWW are alive now.

Chris gave an accurate outline of their political involvement as students, Kumar’s academic brilliance and his later roles as a Lecturer and Director of the CEB under the United Front Government. Chris also described Kumar’s later academic interest and professional expertise in the unbundling of power systems and opening them to the market. Even though he was a Marxist, or may be because of it, Kumar had a good understanding of the operation of the market forces in the electricity sector.

Chris also dealt at length on Sri Lanka’s divergent economic trajectories before and after 1977, and the current aftermath of the recent economic crisis. As someone who has worked with the World Bank in 81 countries and has had the experience of IMF bailout programs, Chris had both warning and advice in light of Sri Lanka’s current situation. No country, he said, has embarked on an economic growth trajectory by following standard IMF prescriptions, and he pointed out that countries like the Asian Tigers have prospered not by following the IMF programs but by charting their own pathways.

Prof. S. Sivasegaram and Dr. K. Vigneswaran graduated in 1964, one year after Kumar David, with first classes in Mechanical Engineering and Civil Engineering, respectively. Sivasegaram joined the academia like Kumar David, while Vigneswaran joined the Irrigation Department but was later drawn into the vortex of Tamil politics where he has been a voice of reason and a source for constructive alternatives. As Engineering students, they were both Federal Party supporters and were not aligned with Kumar’s left politics.

It was later at London Imperial College, Sivasegaram said, he got interested in Marxism and he credited Kumar as one of the people who introduced him to Marxism and to anti-Vietnam protests. But Kumar could not persuade Sivasegaram to be a Trotskyite. Sivasegaram has been a Maoist in politics and apart from his Engineering, he is also an accomplished poet in Tamil. Vigneswaran recalled Kumar’s political involvement as a Marxist in support of the right of self-determination of the Tamils and his accessibility to Tamil groups who were looking for support from the political left.

K. Ramathas and Lal Chandranath were students of Kumar David at Peradeniya, and both went on to become established professionals in the IT sector. Ramathas passionately recalled Kumar’s effectiveness as a teacher and described his personal debt of gratitude for helping him to get a lasting understanding of the concept and application of power system stability. This understanding has helped him deal with other systems, said Ramathas, even as he bemoaned the lack of understanding of system stability among young Engineers and their failure to properly explain and address recurrent power failures in Sri Lanka.

Left Politics without Power

The transition from Engineering to politics in the discussion was seamlessly handled by veterans of left politics, viz., Siritunga Jayasuriya, Piyal Rajakaruna and Dishan Dharmasena, and by Prof. Nirmal Dewasiri of the History Department at the University of Colombo. Siritunga, Piyal and Dishan spoke to the personal, intellectual and organizational aspects of Kumar David in the development of left politics after Kumar David, Vasudeva Nanayakkara and Bahu were no longer associated with the LSSP. Dewasiri reflected on the role of the intellectuals in left political parties and the lost to the left movement as a whole arising from the resignation or expulsion of intellectuals from left political organizations.

While Kumar David’s academic and professional pre-occupation was electric power, pursuing power for the sake of power was not the essence of his politics. That has been the case with Bahu and Sivasegaram as well. They naturally had a teaching or educational role in politics, but they shared another dimension that is universally common to Left politics. Leszek Kolakowski, the Polish Marxist who later became the most celebrated Marxist renegade, has opined that insofar as leftists are generally ahead of their times in advocating fundamental social change and promoting ideas that do not resonate with much of the population, they are unlikely to win power through electoral means.

Yet opposition politics predicated on exposing and decrying everything that is wrong with the system and projecting to change the system is fundamentally the most moral position that one can take in politics. So much so it is worth pursuing even without the prospect of power, as Hector Abhayavardhana wrote in his obituaries for LSSP leaders like NM Perera and Colvin R de Silva. By that token, the coalition politics of the 1960s could be seen as privileging a shared parliamentary path to power while dismissing as doctrinaire the insistence on a sole revolutionary path to power.

The two perspectives clashed head on and splintered the LSSP at its historic 1964 Conference. Kumar David and Lal Wijenayake were the youngest members at that conference, and the political genesis of Kumar David and others at the Engineering faculty that Chris Ratnayake outlined was essentially post-coalition politics. In later years, Vasudeva Nanayakkara, Bahu and Kumar David set about creating a left-opposition (Vama) tendency within the LSSP.

This was considered a superior alternative to breaking away from the Party that had been the experience of 1964. Kumar David may have instinctively appreciated the primacy of the overall system stability even if individual components were getting to be unstable! But their internal efforts were stalled, and they were systematically expelled from the Party one by one. Kumar David recounted these developments in the obituary he wrote for Bahu.

As I wrote last week, after 1977 and with the presidential system in place, the hitherto left political parties and organizations generally allied themselves with one or the other of the three main political alliances led by the SLFP, the SLPP and even the UNP. A cluster of them gravitated to the NPP that has been set up by the JVP under the leadership of Anura Kumara Dissanayake. Kumar David supported the new JVP/NPP initiative and was optimistic about its prospects. He wrote positively about them in his weekly columns in the Sunday Island and the Colombo Telegraph.

The Social Circles of Politics

Sometime in late 2006, Rohan Edrisinha introduced Kumar and me to Rajpal Abeynayake, who was then the Editor of the Sunday Observer, for the purpose of writing weekly columns for the Paper. Bahu was already writing for the Sunday Observer and for almost an year, Bahu, Kumar and I were Sunday Island columnists, courtesy of Rajpal Abeynayake. In 2007, Prof. Vijaya Kumar introduced us to Manik de Silva, already the doyen of Sri Lanka’s English medium editors, and Kumar and I started writing for the Sunday Island edited by Manik. It has been non-stop weekly writing a full 18 years. For a number of years, we have also been publishing modified versions of our articles in the Colombo Telegraph, the online journal edited by the inimitable Uvindu Kurukulasuriya.

Writing mainstream rekindled old friendships and created new ones. It was gratifying to see many of them show up at the celebration of life for Kumar. That included Rajpal Abeynayake, Bunchy Rahuman, Gamini Kulatunga, Ranjith Galappatti, Tissa Jayatilaka, NG (Tanky) Wickremeratne, and Manik de Silva. Vijaya Chandrasoma, who unfortunately could not attend the meeting, was particularly supportive of the event along with Tanky and Ramathas. Tissa and Manik spoke at the event and shared their memories of Kumar.

Dr. Santhushya Fernando of the Colombo Medical Faculty provided organizational support and created two superb video montages of Kumar’s life in pictures to background theme songs by Nat King Cole and Frank Sinatra. Manoj Rathnayake produced a Video Recording of the event.

In a quirky coincidence, five of those who attended the event, viz. Manik de Silva, Vijaya Kumar, Chris Ratnayake, S. Sivasegaram and K. Vigneswaran were all classmates at Royal College. On a personal note, I have been associated with every one of them in one way or another. Chris and I were also Engineers at the Hantana Housing Development in the early 1980s, for which the late Suren Wickremesinghe and his wife Tanya were the Architects. And Suren was in the same Royal College class as the other five mentioned here.

In the last article he wrote before his passing, Kumar David congratulated Anura Kumara Dissanayake for his magnificent political achievement and expressed cautious optimism for the prospects under an NPP government. Many in the new government followed Kumar David’s articles and opinions and were keen to participate in the celebration of life that was organized for him. That was not going to be possible anyway with the visit of Prime Minister Modi falling on the same day. Even so, Prof. Sunil Servi, Minister of Buddha Sasana, and Religious and Cultural Affairs, was graciously present at the event and expressed his appreciation of Kumar David’s contributions to Sri Lankan politics and society.

by Rajan Philips

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53 Years of HARTI- Looking Back and Looking Ahead

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Agrarian Research and Training Institute (ARTI).

C. Narayanasuwami, the first Director of the then Agrarian Research and Training Institute (ARTI).

I am delighted to be associated with the fifty third anniversary celebrations of HARTI. I cherish pleasant memories of the relentless efforts made as the First Director to establish, incorporate, develop, direct, and manage a nascent institute in the 1970s amidst many challenges. The seven-year period as Director remains as the most formidable and rewarding period in my career as a development professional. I have been fortunate to have had a continuing relationship with HARTI over the last five decades. It is rarely that one who played a significant role in the establishment and growth of an institution gets an opportunity to maintain the links throughout his lifetime and provide messages on the completion of its fifth (I was still the director then), the 15th, 50th and 53rd anniversaries.

I had occasion also to acknowledge the contribution of the Institute on its 46th year when I released my book, ‘Managing Development: People, Policies and Institutions’ using HARTI auditorium and facilities, with the able support of the then director and staff who made the event memorable. The book contains a special chapter on HARTI.

On HARTI’s 15th anniversary I was called upon to offer some thoughts on the Institute’s future operations. The following were some of my observations then, “ARTI has graduated from its stage of infancy to adolescence….Looking back it gives me great satisfaction to observe the vast strides it has made in developing itself into a dynamic multidisciplinary research institution with a complement of qualified and trained staff. The significant progress achieved in new areas such as marketing and food policy, data processing, statistical consultancies, information dissemination and irrigation management, highlights the relevance and validity of the scope and objectives originally conceived and implemented”.

It may be prudent to review whether the recommendations contained in that message, specifically (a) the preparation of a catalogue of research findings accepted for implementation partially or fully during policy formulation, (b) the relevance and usefulness of information services and market research activities in enhancing farmer income, and (c) the extent to which the concept of interdisciplinary research- a judicious blend of socio-economic and technical research considered vital for problem-oriented studies- was applied to seek solutions to problems in the agricultural sector.

The thoughts expressed on the 15th anniversary also encompassed some significant management concerns, specifically, the need to study the institutional capabilities of implementing agencies, including the ‘human factor’ that influenced development, and a critical review of leadership patterns, management styles, motivational aspects, and behavioural and attitudinal factors that were considered vital to improve performance of agrarian enterprises.

A review of HARTI’s current operational processes confirm that farmer-based and policy-based studies are given greater attention, as for example, providing market information service for the benefit of producers, and undertaking credit, microfinance, and marketing studies to support policy changes.

The changes introduced over the years which modified the original discipline-based research units into more functional divisions such as agricultural policy and project evaluation division, environmental and water resources management division, and agricultural resource management division, clearly signified the growing importance attached to functional, action-oriented research in preference to the originally conceived narrowly focused discipline-based research activities.

HARTI has firmly established its place as a centre of excellence in socio-economic research and training with a mature staff base. It is pertinent at this juncture to determine whether the progress of HARTI’s operations was consistently and uniformly assessed as successful over the last five decades.

Anecdotal evidence and transient observations suggest that there were ups and downs in performance standards over the last couple of decades due to a variety of factors, not excluding political and administrative interventions, that downplayed the significance of socio-economic research. The success of HARTI’s operations, including the impact of policy-based studies, should be judged on the basis of improved legislation to establish a more structured socio-economic policy framework for agrarian development.

Looking Ahead

Fifty-three years in the life of an institution is substantial and significant enough to review, reflect and evaluate successes and shortcomings. Agrarian landscapes have changed over the last few decades and national and global trends in agriculture have seen radical transformation. Under these circumstances, such a review and reflection would provide the basis for improving organisational structures for agricultural institutions such as the Paddy Marketing Board, development of well-conceived food security plans, and above all, carefully orchestrated interventions to improve farmer income.

New opportunities have arisen consequent to the recent changes in the political horizon which further validates the role of HARTI. HARTI was born at a time when Land Reform and Agricultural Productivity were given pride of place in the development programs of the then government. The Paddy Lands Act provided for the emancipation of the farming community but recent events have proven that the implementation of the Paddy Lands Act has to be re-looked at in the context of agricultural marketing, agricultural productivity and income generation for the farming community.

Farmers have been at the mercy of millers and the price of paddy has been manipulated by an oligopoly of millers. This needs change and greater flexibility must be exercised to fix a guaranteed scale of prices that adjust to varying market situations, and provide adequate storage and milling facilities to ensure that there is no price manipulation. It is time that the Paddy Lands Act is amended to provide for greater flexibility in the provision of milling, storage and marketing services.

The need for restructuring small and medium scale enterprises (SMEs) recently announced by the government warrants greater inputs from HARTI to study the structure, institutional impediments and managerial constraints that inflict heavy damages leading to losses in profitability and organisational efficiency of SMEs.

Similarly, HARTI should look at the operational efficiency of the cooperative societies and assess the inputs required to make them more viable agrarian institutions at the rural level. A compact research exercise could unearth inefficiencies that require remedial intervention.

With heightened priority accorded to poverty alleviation and rural development by the current government, HARTI should be in the forefront to initiate case studies on a country wide platform, perhaps selecting areas on a zonal basis, to determine applicable modes of intervention that would help alleviate poverty.

The objective should be to work with implementing line agencies to identify structural and institutional weaknesses that hamper implementation of poverty reduction and rural development policies and programs.

The role played in disseminating marketing information has had considerable success in keeping the farming community informed of pricing structures. This should be further expanded to identify simple agricultural marketing practices that contribute to better pricing and income distribution.

HARTI should consider setting up a small management unit to provide inputs for management of small-scale agrarian enterprises, including the setting up of monitoring and evaluation programs, to regularly monitor and evaluate implementation performance and provide advisory support.

Research and training must get high level endorsement

to ensure that agrarian policies and programs constitute integral components of the agricultural development framework. This would necessitate a role for HARTI in central planning bodies to propose, consider and align research priorities in line with critical agricultural needs.

There is a felt need to establish links with universities and co-opt university staff to play a role in HARTI research and training activities-this was done during the initial seven-year period. These linkages would help HARTI to undertake evaluative studies jointly to assess impacts of agrarian/agricultural projects and disseminate lessons learned for improving the planning and execution of future projects in the different sectors.

In the overall analysis, the usefulness of HARTI remains in articulating that research and analysis are crucial to the success of implementation of agrarian policies and programs.

In conclusion, let us congratulate the architects and the dynamic management teams and staff that supported the remarkable growth of HARTI which today looks forward to injecting greater dynamism to build a robust institution that would gear itself to meeting the challenges of a new era of diversified and self-reliant agrarian society. As the first director of the Institute, it is my wish that it should grow from strength to strength to maintain its objectivity and produce evidence-based studies that would help toward better policies and implementation structures for rural transformation.

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Keynote Speech at the Launch of The Ceylon Journal, by Rohan Pethiyagoda

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“How Rubber Shaped our Political Philosophy”

The Ceylon Journal was launched last August. Its first issue is already out of print. Only a handful of the second issue covering new perspectives of history, art, law, politics, folklore, and many other facets of Sri Lanka is available. To reserve your very own copy priced Rs. 2000 call on 0725830728.

Congratulations, Avishka [Senewiratne]. I am so proud of what you have done. Especially, Ladies and Gentlemen, to see and hear all of us stand up and actually sing the National Anthem was such a pleasure. Too often on occasions like this, the anthem is played, and no one sings. And we sang so beautifully this evening that it brought tears to my eyes. It is not often we get to think patriotic thoughts in Sri Lanka nowadays: this evening was a refreshing exception.

I’m never very sure what to say on an occasion like this, in which we celebrate history, especially given that I am a scientist and not a historian. It poses something of a challenge for me. Although we are often told that we must study history because it repeats itself, I don’t believe it ever does. But history certainly informs us: articles such as those in The Ceylon Journal, of which I read an advance copy, help us understand the context of our past and how it explains our present.

I want to take an example and explain what I am on about. I’m going to talk about rubber. Yes rubber, as in ‘eraser’, and how it crafted our national political identity, helping, even now seven decades later, to make ‘capitalism’ a pejorative.

As I think you know already, rubber came into general use in the middle of the 19th century. Charles Macintosh invented the raincoat in 1824 by placing a thin sheet of rubber between two sheets of fabric and pressing them together. That invention transformed many things, not least warfare. Just think of Napoleon’s invasion of Russia in the winter of 1812. His troops did that without any kind of waterproof clothing. Some 200,000 of them perished, not from bullets but from hypothermia. Waterproof raincoats could have saved thousands of lives. Not long after rubber came to be used for waterproofing, we saw the first undersea telegraph cable connecting Europe to North America being laid in the 1850s. When the American civil war broke out in 1860, demand for rubber increased yet further: the troops needed raincoats and other items made from this miracle material.

At that time rubber, used to be collected from the wild in the province of Pará in Northern Brazil, across which the Amazon drains into the Atlantic. In 1866, steamers began plying thousands of kilometres upriver, to return with cargoes of rubber harvested from the rainforest. Soon, the wild trees were being tapped to exhaustion and the sustainability of supply became doubtful.

Meanwhile, England was at the zenith of its colonial power, and colonial strategists thought rather like corporate strategists do today. The director of the Kew Gardens at the time, Joseph Hooker, felt there might be one day be a greater potential for rubber. He decided to look into the possibility of cultivating the rubber tree, Hevea brasiliensis, in Britain’s Asian colonies. So, he dispatched a young man called Henry Wickham to the Amazon to try to secure some seeds. In 1876, Wickham returned to Kew with 70,000 rubber seeds. These were planted out in hothouses in Kew and by the end of that year, almost 2000 of them had germinated.

These were dispatched to Ceylon, only a few weeks’ voyage away now, thanks to steamships and the Suez Canal. The director of the Peradeniya Botanic Garden at the time was George Henry Kendrick Thwaites, a brilliant systematic botanist and horticulturalist. Thwaites received the seedlings and had to decide where to plant them. He read the available literature—remember, this was 1876: there was no internet—and managed to piece together a model of the climatic conditions in the region of the Amazonian rainforest to which rubber was native. He decided that the plants would need an elevation of less than 300 metres and a minimum annual rainfall of at least 2000mm. In other words, the most suitable region for rubber would be an arc about 30 kilometres wide, extending roughly from Ambalangoda to Matale. Despite his never having seen a rubber plant until then, astonishingly, he got it exactly right.

Thwaites settled on a site in the middle of the arc, at Henarathgoda near Gampaha. That became the world’s first rubber nursery: the first successful cultivation of this tree outside Brazil. The trees grew well and, eight years later, came into seed. Henry Trimen, Thwaites’ successor, used the seeds to establish an experimental plantation near Polgahawela and also shared seeds with the Singapore Botanic Garden. Those would later become the foundation of the great Malaysian rubber industry.

But up to that time, Sri Lanka’s rubber plantation remained a solution looking for a problem. Then, in 1888, the problem arrived, and from a completely unexpected quarter: John Dunlop invented the pneumatic tire. Soon, bicycles came to be fitted with air-filled tires, followed by motorcars. In 1900, the US produced just 5,000 motorcars; by 1915, production had risen to half a million. The great rubber boom had begun.

Meanwhile, the colonial administration in Ceylon had invited investors to buy land and start cultivating rubber to feed the growing international demand. But by the early 1890s, three unusual things had happened. First, with the collapse of the coffee industry in the mid-1870s, many British investors had been bankrupted. Those who survived had to divert all their available capital into transitioning their failing coffee plantations into tea. They were understandably averse to risk. As a result, the British showed little interest in this strange tree called rubber that had been bought from Brazil.

Second, a native Sri Lankan middle class had by then emerged. The Colebrooke-Cameron reforms had led to the establishment of the Royal academy, later Royal College, by 1835. Other great schools followed in quick succession. From the middle of the 19th century, it was possible for Sri Lankans to get an education and get employment in government service, become professionals, doctors, lawyers, engineers, civil servants, clerks, and so on. And so, by the 1890s, a solid native middle class had emerged. The feature that defines a middle class, of course, is savings, and these savings now came to be translated into the capital that founded the rubber industry.

Third, the British had by then established a rail and road network and created the legal and commercial institutions for managing credit and doing business—institutions like banks, financial services, contract law and laws that regulated bankruptcy. They had made the rules, but by now, Sri Lankans had learned to play the game. And so, it came to be that Sri Lankans came to own a substantial part of the rubber-plantation industry very early in the game. By 1911, almost 200,000 acres of rubber had been planted and world demand was growing exponentially.

In just one generation, investors in rubber were reaping eye-watering returns that in today’s money would equate to Rs 3.6 million per acre per year. It was these people who, together with the coconut barons, came to own the grand mansions that adorn the poshest roads in Cinnamon Gardens: Ward Place, Rosmead Place, Barnes Place, Horton Place, and so on. There was an astonishingly rapid creation of indigenous wealth. By 1911, the tonnage at shipping calling in Sri Lankan ports—Colombo and Trincomalee—exceeded nine million tons, making them collectively the third busiest in the British Empire and the seventh busiest in the world. By comparison, the busiest port in Europe is now Rotterdam, which ranks tenth in the world.

We often blame politicians for things that go wrong in our country and God knows they are responsible for most of it. But unfortunately for us, the first six years of independence, from 1948 to 1954, were really unlucky years for Sri Lanka. As if successive failed monsoons and falling rice crops weren’t bad enough, along came the Korean war. In the meantime, the Sri Lankan people had got used to the idea of food rations during the war and they wanted rations to be continued as free handouts. Those demands climaxed in the ‘Hartal’ of 1953, a general strike demanding something for nothing. Politicians were being forced to keep the promises they had made when before independence, that they would deliver greater prosperity than under the British.

So, by 1949, D. S. Senanayake was forced to devalue the rupee, leading to rapid price inflation. Thankfully we didn’t have significant foreign debt then, or we might have had to declare insolvency much earlier than we finally did, in 2022. And then, because of failing paddy harvests, we were forced to buy rice

from China, which was in turn buying our rubber. But as luck would have it, China entered the Korean war, causing the UN, at the behest of the US, to embargo rubber exports to China.

This placed the D. S. Senanayake and John Kotelawala governments in an impossible predicament. There was a rice shortage; people were demanding free rice, and without rubber exports, there was no foreign exchange with which to buy rice. Kotelawala flew to Washington, D.C., to meet with President Eisenhower and plead for either an exemption from the embargo or else, for the US to buy our rubber. Despite Sri Lanka having provided rubber to the Allies at concessionary prices during the war and having supported the Allies, Eisenhower refused. British and American memories were short indeed. In India, Mahatma Gandhi and the Congress Party had chosen the moment, in August 1942 when Japan invaded Southeast Asia and were poised to invade Bengal, to demand that the British quit India, threatening in the alternative that they would throw their lot in with the Japanese. The Sri Lankan government, by contrast, had stood solidly by the Allies. But now, those same allies stabbed the fledgling nation in the chest. Gratitude, it seemed, was a concept alien to the West.

In these circumstances, Sri Lanka had no choice but to break the UN embargo and enter into a rice-for-rubber barter agreement with China. This resulted not only in the US suspending aid and the supply of agricultural chemicals to Sri Lanka, but also invoking the Battle Act and placing restrictions on US and UK ships calling at the island’s ports.

Understandably, by 1948, Sri Lankans entertained a strong disdain for colonialism. With the Cold War now under way, the USSR and China did all they could to split countries like Sri Lana away not just from their erstwhile colonial masters but also the capitalist system. If any doubt persisted in the minds of Sri Lankan politicians, Western sanctions put an end to that. The country fell into the warm embrace of the communist powers. China and the USSR were quick to fill the void left by the West, and especially in the 1950s, there was good reason to believe that the communist system was working. The Soviet economy was seeing unprecedented growth, and that decade saw them producing hydrogen bombs and putting the first satellite, dog and man in space.

As a consequence of the West’s perfidy in the early 1950s, ‘Capitalism’ continues to have pejorative connotations in Sri Lanka to this day. And it resulted in us becoming more insular, more inward looking, and anxious to assert our nationalism even when it cost us dearly.

Soon, we abolished the use of English, and we nationalized Western oil companies and the plantations. None of these things did us the slightest bit of good. We even changed the name of the country in English from Ceylon to Sri Lanka. Most countries in the world have an international name in addition to the name they call themselves. Sri Lanka had been ‘Lanka’ in Sinhala throughout the colonial period, even as its name had been Ceylon in English. The Japanese don’t call themselves Japan in their own language, neither do the Germans call themselves Germany. These are international names for Nihon and Deutschland, just like Baharat or Hindustan is what Indians call India. But we insisted that little Sri Lanka will assert itself and insist what the world would call us, the classic symptom of a massive inferiority complex. While countries like Singapore built on the brand value of their colonial names, we erased ours from the books. Now, no one knows where Ceylon tea or Ceylon cinnamon comes from.

Singapore is itself a British name: it should be Sinha Pura, the Lion City, a Sanskrit name. But Singapore values its bottom line more than its commitment to terminological exactitude. Even the name of its first British governor, Sir Stamford Raffles, has become a valued national brand. But here in Sri Lanka, rather than build on our colonial heritage, not the least liberal values the British engendered in us, together with democracy and a moderately regulated economy, we have chosen to deny it and seek to expunge it from our memory. We rejected the good values of the West along with the bad: like courtesy, queuing, and the idea that corruption is wrong.

We have stopped fighting for the dignity of our land, and I hope that as you read the articles in The Ceylon Journal that are published in the future, we will be reminded time and time again of the beautiful heritage of our country and how we can once again find it in ourselves to be proud of this wonderful land.

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