Sri Lanka was part of the Empire of Asoka in the third century, during which time the population was converted to Buddhism. The Sinhalese inhabitants later moved their capital to Polonnaruwa, in the south of the island, to escape from repeated Tamil invasions during the 11th and 12th centuries. The first Europeans to arrive were the Portuguese, who were quickly supplanted by the Dutch in the 17th century. The British acquired Sri Lanka (as Ceylon) from the Dutch in 1796. Administration of the island was initially shared between the East India Company and the Crown; however, the latter assumed full
control in 1802. Sri Lanka (as Ceylon) eventually won independence in 1948. Past colonization by the Indians, Portuguese, Dutch and British have all left their marks in architecture, customs, language and agriculture.
The country became a republic in 1972, adopting a new constitution along with the Sinhala name, Sri Lanka. The majority (70 per cent) of the population are Buddhists of Sinhalese descent, although the north and parts of the east of Sri Lanka are dominated by the Tamil population (15 per cent), Hindu by religion and ethnically linked to the Tamils of southern India. Serious conflict arose from the Tamil minority’s demands for a separate Tamil state, with terrorist activity by the Liberation Tigers of Tamil Eelam (Tamil Eelam being the title of their notional independent state) prevalent since the 1970s. This provoked increasingly vigorous responses from the government.
The Indian government became involved in the conflict, initially as official mediator between the Tamils and the Sri Lankan government but then, after the failure of an armistice in 1987, it intervened militarily (on the government’s side). Its two-year military campaign ended with the death of over 1000 Indian soldiers and an ignominious retreat.
The assassination of Indian premier Rajiv Ghandi in 1991 was the apotheosis of the Tigers’ campaign of revenge for the Indian military campaign. After that, the war entered a period of effective stalemate, with each side gaining occasional advantage through upgrading, re-equipping or deployment of new tactics.
Outside the Tiger-controlled areas in the north and east – inside which the guerrillas had absolute authority – the political environment was dominated by the struggle between the country’s two main political groupings – the center-right United National Party and the People’s Alliance (a coalition of social-democratic and socialist parties). The decisive election of recent times took place in 1995, when the UNP’s 17-year stranglehold on power was finally broken by the People’s Alliance, under Chandrikha Kumaratunga, another member of South Asia’s pantheon of formidable female politicians. (Her predecessor, Sirimavo Bandaranaike, was the world’s first female Prime Minister and held several terms of office between 1959 and 1977.) Kumaratunga won a second Presidential term in 1999, although the UNP did regain control of the national assembly in late 2001 under veteran politician Ranil Wickremasinghe.
Kumaratunga was determined to resolve the Tamil conflict. Despite a number of setbacks, and with the discreet assistance of Norwegian negotiators, a deal between the government and the Tamil Tigers was finally concluded in early 2002. Despite skepticism from many quarters and a number of serious incidents, the ceasefire held. The island’s sizeable Muslim population, who were persecuted by both sides throughout the two-decade-long conflict, was also brought into the settlement. However, as with any conflict of that length and hostility, many issues remained to be resolved, not least the future government of the Tamil-dominated northern and eastern parts of the island and the control of aid (around $600 million has been pledged from various sources) for reconstruction and rehabilitation.
All this was not helped by a serious feud between President Karamatunga and Prime Minister Wickremesinghe, which led in November 2003 to suspension of parliament and the dismissal of three ministers by President Karamatunga. This political turbulence seemed to catalyse a sudden resurgence in Tamil Tiger activity in early 2004, with the Renegade Tiger commander, Karuna, orchestrating a split in the rebel movement, going underground with his supporters. Unfortunately, this culminated in a suicide bomb blast in July 2004 in Colombo, shattering the infrastructure of the peace process negotiated in 2001. This followed the replacement of Wickremesinghe at the assembly elections, with Mahinda Rajapakse becoming Prime Minister. It remains to be seen how this change, and Sri Lanka's highly polarized parliament, confront the difficult Tamil issue.
Sri Lanka was also very badly hit by the tsunami on December 26 2004. Southern and eastern coastal areas were virtually all but destroyed, both lives and livelihoods perishing under the weight of the natural disaster. Foreign troops have been given a free reign in helping put the country back on track, clearing wreckage and aiding reconstruction. However, it appears that the politic is still being given precedence over the individual, with suggestions that the badly hit Tamil-controlled areas of Sri Lanka are not being given access to as much available aid as elsewhere. It seems as if the tsunami and its aftermath shall not be an event that has united the country, albeit in tragedy, but rather a catalyst for escalating ethnic grievances.
Presidential elections in November 2005 were closely fought between Prime Minister Mahinda Rajapakse, who vowed to take a hard line in talks with Tamil Tiger rebels, and Wickremesinghe, who promised to build on the ceasefire agreement he had helped draw up. Rajapakse won narrowly in an election which saw an almost total boycott in the Tamil areas.
GovernmentExecutive power and legislative power are vested in the President and a single-chamber assembly respectively. The President is directly elected for a six-year term. The 255-member assembly is elected by proportional representation.
EconomyAlthough some parts of the economy have suffered severe dislocation as a result of the civil war, especially the once promising tourist industry, Sri Lanka has managed to accommodate the conflict to the extent that the economy performed reasonably well during the last five years. This was reflected in the GDP growth rate of 6% in 2005.
Agriculture sustains about one-third of the working population and directly contributes around 20% of GDP. The main cash crops are tea, rubber and coconuts, which provide over 75% of export earnings; rice is grown mainly for domestic consumption. Forestry and fishing are also important.
The main industrial sectors are mining (gemstones and graphite being the principal minerals), and manufacturing. Iron ore, limestone, clay and uranium ore are also present in commercially exploitable quantities. Hydroelectricity is the main source of power, supplemented by imported oil. Important manufacturing industries include cement and textiles, both of which are valuable export earners.
In the service sector, the growth of tourism has been stunted by the civil war, but banking and insurance have both been performing well. Since the mid 1990s, successive governments have followed the usual prescription of market-oriented policies (privatization and deregulation) while seeking to build up potential export-earning industries. This strategy was slow to show results at first, but the government persevered and some benefits are now beginning to materialize.
The government is now hoping to consolidate its progress by further deregulation, fiscal reform, and privatization: although it has all but pulled out of manufacturing, the state still owns 90% of the island’s land and the bulk of its utilities.
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