Sunil Bastian

Sunil Bastian is a political economist. His current research interests are politics of state formation and development of capitalism in Sri Lanka. He has published widely and authored many books. He has been a Senior Research Fellow at the International Centre for Ethnic Studies, Colombo and chairperson of the Centre for Poverty Analysis. He has more than two decades of consultancy experience with a range of donor agencies.

Sri Lanka: The ‘Crisis’ – Another View

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This short contribution analyses the crisisthat Sri Lankan society is facing today to be result of contradictions arising from two processes in the specific Sri Lankan context: efforts to sustain the post-war state; and continuing with the new period of capitalist transitionthat started in 1977 which emphasised markets, private sector and greater degree of openness to global capitalism.

Consolidating territory and post-war security

When the Tamils demanded a separate state in 1977, the armed struggle of Tamil militants challenged the territorial integrity of the centralised Sinhala nationalist state. For many years the Sri Lankan state was a fractured state. The Sri Lankan state could not carry out regular functions like a census, which is a key technique of controlling the territory and population within the strategic space that a state wants to control. The state could not carry out the 1991 census. The 2001 census did not cover Jaffna, Killinochchi and MullativuDistricts and only partial coverage of Vavuniya, Mannar, Batticaloa and Trincomalee Districts. The military strategy to regain control of the territory of the state began in 1979, with the enactment of the Prevention of Terrorism Act (PTA) and sending troops to the North. It succeeded 30 years later, in 2009.

Several factors helped the success of the military strategy. The military capability of the Sri Lankan armed forces had improved. Another reason was how international factors favoured the Sri Lankan state. The most important international factor was the behaviour of the regional power, India. Unlike in June 1987 – when India intervened and stopped the Vadamarachchimilitary operations against Tamil militancy, which led to the Indo-Lanka Accord – this time India had no interest in preventing military operations against the LTTE. Although India was concerned about civilian casualties and possible refugee flows to Tamil Nadu, LTTE politics had alienated the support from the Indian state.

For key international actors such as the US and EU, the LTTE was a terrorist organisation. Although there were concerns about civilian casualties, available evidence indicates that many international actors were not averse to seeing the end of the LTTE. An important development on the international dimension during military operations against the LTTE was China coming to assist the Sri Lankan state. This revived an old relationship between China and the Sri Lankan state.

As in the case of many state-formation conflicts, the consolidation of the territory of the Sinhala nationalist state through military means resulted in heavy civilian casualties. Sri Lanka became yet another case where the so-called international community could not prevent civilian casualties when the territory of the state was consolidated through military means. Close to 300,000 people were trapped in the ever-shrinking area under LTTE control. What really happened during the last stages of the war is a question that awaits the skills of a new generation of researchers. The discussion is dominated at present by numbers. What we need is a social history of the last stages of war, with detailed case studies in areas where the armed battles between the LTTE and Sri Lankan armed forces took place.

Several steps to ensure the security of the post-war state followed the consolidation of territory of the centralised Sinhala nationalist state. First, relinking the war-affected areas with the centre through infrastructure projects. There was foreign aid support to implement this. Second, the post-war state continued to maintain the strength of the armed forces. A by-product of three decades of armed conflict was a larger security sector. This continues in the post-war period. Third, compared to the period before the Tamils demanded a separate state, there is a relatively larger presence of the armed forces of the centralised Sinhala nationalist state in the Northern Province, the heartland of Tamil nationalism.Fourth, the security of the post-war state continues to be strengthened by a discourse of terrorism,and maintaining a legal framework that enhances the coercive power of the state. In this context the notion of reconciliation,which has become popular in certain quarters,is a means of stabilising society. If there are no parallel state reforms to meet the grievances of minorities, reconciliation becomes a part of the post-war security strategy. Some of the exercises of so-called local-level peacebuilding have the same political objective.

The Resource base, or economic security of the post-war state

A new political leadership emerged within the Sinhala majority, because of the leadership it gave to consolidating the territory of the Sinhala nationalist state. This resulted in a break in the consensus on economic policies that had emerged among the political elite in the post 1977 period.

From the beginning of the post-colonial period there were two ideological trends within the Sri Lankan political elite on how to proceed with capitalist transition. One favoured openness to global capitalism, export orientation, dependence on markets and the private sector. The other favoured a greater role for the state, and less openness to global capitalism. Various ideological currents like economic nationalism and various forms of mercantilism supported what can be called state capitalist policies.

After 1977 the ideological current that emphasised markets, private sector and openness to global capitalism became dominant.When the People’s Alliance, consisting of more centre-Left parties came to power in 1994,and adoptedneoliberal policies, a consensus was established among the political elite on economic policies.  But in the post-war period,the new political leadership,which emerged because of the leadership given to ending the war,shifted economic policies more in the direction of state capitalism. There was less belief in free markets, trade liberalisation, and handing over state assets to the private sector.

The post-war period also saw a change in sources of external finance to the Sri Lankan state.The post-1977 Sri Lankan state, due to its liberal economic policies, received a significantly higher level of foreign aid from developed capitalist countries of the West, Japan and multilaterals. This included loans at concessional rates. The primary condition was continuing with neoliberal economic policies. This support helped to sustain the resource base,or economic security,of the state, while it waged an armed conflict that demanded more and more resources. Foreign aid support that helps military efforts need not come from direct support to the armed forces. If foreign aid helps the state to manage normal development activities, its own resources can be used for the war effort. This happened in Sri Lanka. Foreign aid support also helped to manage relations with the Sinhala majority while implementing liberal economic reforms.

The Sri Lankan state became ineligible for concessional assistance in the post-war period because of its middle-income status. A major result of this was that the post-war Sri Lankan state depending to a greater degree on global financial markets for its external finances. This rose sharply in the post-war period. Certainly, the fact that the state had been stabilised made it easier to raise funds in global financial markets. In 2018 financial markets accounted for 59.4 per cent of the outstanding foreign debt. The other important development in this area was that regional powers, China and India, with the growth of their capitalism, becoming sources of external finance. These developments have their own political implications for the post-war Sri Lankan state.

This was the larger context within which the political elite controlling the centralised Sinhala nationalist state facedchallenges to sustaining the post-war state while continuing with the process of capitalist transition. The structure of the Sri Lankan state has undergone significant changes during the post 1977 period. As already mentioned, the result of more than three decades of armed conflict was the growth of the armed forces. The post-war state has to carry the cost of this security sector. In addition, there has been a proliferation of state institutions. The structure of the post-war state has institutions at presidential, parliament, provincial, district, sub-district and local authority levels. Almost all these levels include elected members and a bureaucracy.

The introduction of institutions at provincial and sub-district levels was linked to conflicts. Provincial councils were an attempt to manage state-society relations with the Tamil minority. Pradeshiya Sabhas at sub-district level were established in 1992.This was a part of a decentralisation strategy after violence in Sinhala majority areas in the 1989/90 period. Decentralisation has always been a strategy that the centre deployed to regain control of the periphery when there were violent challenges to the state from the Sinhala majority. This happened after the 1971 insurgency and again after the 1989/90 violence. In addition, the institutions of the central state have undergone numerous divisions. The need to maintain the stability of coalition regimes and large cabinets has played a role in this. The strategy of the political elite has been to divide state institutionsand distribute them among coalition partners. On top of this the state budget has to carry the burden of sustaining loss-making state-owned enterprises.Data from what the Central Bank identifies as functional classification of government expenditure shows that, in 2018, the post-war Sri Lankan state spent 49.9 per cent of public expenditure to cover the maintenance of the bureaucracy, security sector and interest payments on loans. 

It is in this larger context that a series of events led to the Sri Lankan state defaulting on loan repayments, and it faced a severe foreign exchange crisis. On Easter Sunday in 2019 suicide bombers, espousing an extreme form of political Islam attacked churches. This shattered the image of post-war stability. This was followed by the spread of Covid-19. Both these had an impact on sources of earning foreign exchange. The final step that undermined the confidence of financial markets in the ability of the post-war Sri Lankan state to service outstanding foreign debt were the significant tax reductions in 2019. This was promised by the regime which favoured state capitalism that came to power through the 2019 presidential elections.

Progressive politics

The economic crisis precipitated by the post-state’sinability to fulfil the demands of global finance capital gave rise to a protest movement. Popularly identified as the ‘Aragalaya’, it succeeded in removing GotabalayaRajapkse from the presidency. He had earlier been hailed as a Sinhala hero, because of his role in defeating the LTTE militarily. This once again shows that politics in Sinhala majority areas cannot be explained by ethnicity alone. The socio-economic contradictions of capitalist transition play an important role.

The ruling political elite’s response to this political crisis is the familiar post 1977 formula. First, deal-making within the political elite,which ensured Ranil Wickremasinghe becoming the president. In the post-1977 period, controlling the presidency has been the most important objective of the political elite who want to control the state. Second, state repression against the protest movement,Aragalaya. For the state is now backed by more-developed security forces and continuation of the Prevention of Terrorism Act. This is to be replaced by a new anti-terrorism act. The important thing is not the specifics of these acts. But that the very notion of terrorism and laws backing have become a hallmark of consolidating states. Third, implementing further reforms to promote capitalist transition, backed by international actors led by the IMF. This formula of state repression, reforms to promote capitalism, and support from international actors is a familiar formula during the neoliberal period of capitalist transition.

There are various responses to this crisis based on diverse political agendas. For many mainstream economists, the political agenda is to restore capitalist growth at any cost. Some others aim to sustain the state as it is. Both these camps are ready to do anything to achieve their political ends even supporting state repression, which has recently added more victims to the long list of people who have suffered from state repression in the post-colonial period.

In contrast to this, I like to end this short contribution by highlighting few critical issues that progressive politics needs to focus on in the current context. The post-war Sri Lankan state’s inability to fulfil the demands of global finance capital has devastated the lives of millions of Sri Lankans.This has happened in a society showing the socio-economic impact of three decades of armed conflict, and more than four decades of liberal capitalism.

According to the Household Income and Expenditure Survey of 2019, 11.9 per cent of households in Sri Lanka lived below the official poverty line. There is a great degree of variation in this indicator between districts, showing the impact of the war. While Colombo District had 1.8 per cent of households below the poverty line, in Mullativu District of the Northern Province it goes up to 39.5 per cent of households. An outcome of more than four decades of liberalisation is the emergence of a highly unequal society. Data for 2019 showed that the richest 20 per cent of the population acquired 51.4 per cent of national income and the poorest 20 per cent had only 4.6 per cent. In order to understand economic inequality and its social and political implications, we need to think beyond these numbers. Focusing on inequality within a capitalist economy is central to the political agenda of social justice. This demands a study of the institutions and balance of political power and ideologies that legitimise inequality in the specific historical context of Sri Lanka. It is these that keepreproducing inequality in society.

The other issue that is important for progressive politics is building a state that has legitimacy in a multi-ethnic society. Although the territory of the centralised Sinhala nationalist state has been consolidated through military means, the key political issues that gave rise to Tamil demands have not been resolved. The social costs of the last stages of the war have added a new demand from the Tamil community. In addition, during the post-war periodother minorities, especially the Muslim community, have been at the receiving end of the politics of Sinhala Buddhist extremism.  Finally, any discussion of minority rights in the post-war state also has to focus on the problems faced by the Indian Tamil or MalayagaMakkal community.

What we need is a political vision that combines social justice and pluralism. We need to make use of existing political institutions to pursue this agenda but be aware of their serious limitations. Finally, we need to carry out these struggles both within Sri Lanka and internationally. 

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Sri Lanka: Reflections on state formation

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This short article explains a framework for analysing Sri Lankan state formation and understanding the current challenges that the country is facing. My interest in state formation began when trying to make sense of the data on political violence and state repression that I had collected from 1977. I realised that I could easily expand this database to cover the entire post-colonial period. It was also clear that this violence was not an abberation or exception, but a systemic characteristic of Sri Lankan society. The data collected largely consisted of numbers and reports of individual events. It just touched the surface of the problem. To understand the impact of political violence and state repression in Sri Lankan society you need to go deeper, preferably using a case study method. This is a task for future researchers.

The dominant essentialist categorisation of the Sri Lankan state -that it is a democracy or a welfare state – was not compatible with the level of political violence and state repression that I was witnessing. In the meantime, I had also begun to analyse political answers to the Tamil demand for a separate state, with a focus on state reform. But this notion of state reform fitted with the conventional approach to studying a state. This approach treats the state as a concrete, self-contained entity that has attained a final status. The legal notion of sovereignty strengthens this idea. Those who control the state, and their ideologues, always try to convey this notion. A whole paraphernalia of rituals, histories and symbols have developed – not only to promote this idea, but also to convey the eternal character of the state.Much of the effort to promote goals such as economic growth, social development and democracy are based on a notion that states have been formed, and now the task is to focus on promoting these objectives.

In contrast to this, the moment you begin to look at states as a product of historical processes, new ways of looking at the state and new avenues of research emerge. This is the way we look at other social phenomena – so why not states? States are formed under certain historical conditions. They continuously undergo changes, and under certain circumstances can even totally disappear. A cursory glance at the history of the world will show this.

At this point it is important to emphasise that, although states are a product of history, once formed they have a degree of autonomy from other societal processes. This means that states cannot be understood by reducing them to any other feature in society. The earliest efforts within Marxist tradition explained the state as a product of capitalist development. This economic reductionism was replaced by a notion of the relative autonomy of the state. Now there are studies focusing more on the autonomous power of the state.

State formation involves developing mechanisms to control territory and to manage state-society relations in a specific historical context. The identity of the state, institutions and public policies are key dimensions in this process. State-society relations are maintained through coercion and consent. When consent overrides coercion, we have states that have legitimacy in society. In such situations the hegemony that sustains the state is strong. When coercion predominates, state security is given priority – but it undermines the security of individuals and groups in society. There is an inherent weakness in the hegemony that sustains this type of state. These processes don’t develop in the same way in all states. They have to be analysed taking specific historical context into account.

A state needs resources to sustain itself, and to manage relations with politically important social groups. These two dimensions constitute the economic security of the state.These resources have to be secured within the process of capitalist transition. When the state has enough economic resources and is able to manage relations with the politically important social groups through specific policies, there is an element of consent in certain dimensions of state-society relations. When this fails the state resorts to coercive measures, and this affects the pattern of state expenditure.

State formation always takes place in an international context – the study of state formation is a study of an individual state in a global context. The international context consists of a system of states, organisations formed by these states and global capitalism. The relationship between the states and global capitalism cannot be seen as a zero-sum game. Changes in global capitalism transform states and the relationship between them. Developments in global capitalism can make some states strong, and some weak.

The international system changes over time. This, in turn, has an impact on the state formation process of individual states. Changes in the global system are determined by the actions of the more powerful players in the international system. The capacity of smaller states to influence changes at the global level is limited. But global-level changes have an impact on the state formation process of smaller states like Sri Lanka.

In the post-colonial history of state formation in Sri Lanka, three types of state-society relations have been important:

– First, relations between the centralised state, inherited from the British colonial period, and minorities. State formation involves bringing together diverse ethnic and religious groups under a single policy.This has not been an easy process in many parts of world. When identity groups have a special link with a part of the territory of the state, it creates special problems. This dimension has been a major source of violence in the history of state formation of Sri Lanka. Trying to construct a centralised state defined by the identity of the Sinhala majority led to Tamils demanding a separate state covering the Northern and Eastern Provinces. What happened in 2009 was consolidating the territory of the centralised Sinhala nationalist state through military means. There has been little progress towards a state that has legitimacy in a multi-ethnic society. The social costs of the last stages of the war have created new problems. In addition, discussions on state-minority relations today cannot be confined to the problems of Tamil people alone. The concerns of other two numerically large minorities – Muslims and Hill country Tamils must be considered.

– Second, electoral politics and state formation. On one hand, electoral politics is a mechanism through which the political elite that controls the state is chosen. On the other side, it is also a mechanism to manage relations between rulers and the ruled. The history of state formation in areas where electoral politics has existed for a long time shows that the characteristics of the political system that emerges is an important factor in constructing a national political space. Constructing a national political space is an important factor in creating a unified state. This means that breaking down territorial cleavages is not simply a result of social changes, but also a product of the actions of parties and characteristics of political systems.

In the case of the post-colonial state formation of Sri Lanka, the dominance of ethnicity right from the beginning gave rise to a political system that could not contribute to the construction of a national political space.Instead, electoral politics and the political system produced regional political spaces with ethnic characteristics. This means that the electoral politics of the post-colonial Sri Lankan state has to be discussed taking account of ethnic political spaces, rather than treating Sri Lanka as a unified political space. The vote in Sinhala majority districts was critical in deciding who came to power.

While electoral politics undermined the formation of a unified state in a multi-ethnic society, its institutionalisation resulted in a competitive system of politics within the Sinhala majority. However, today this aspect of the political system which depends on the support of the Sinhala majority, is highly fractured. Two trends dominate – the struggle to control the presidency and enjoy the power that comes with it and deal -making politics for the sake of power. How this political system can tackle the multiple problems that the country is facing is an open question. Certainly, legal reforms alone will not go very far.

– The third important variable in post-colonial state formation of Sri Lanka is relations between the state and the Sinhala majority in the context of the politics of capitalist transition.Capitalist transition within a state is a process that involves changing institutions or the ‘rules of the game’, so that markets become the primary mechanism for resource allocation. These changes must be legitimised at an ideological level. When institutions to establish markets are successful, they become ideas that seem to be natural and common sense, thereby creating a hegemony. The establishment of the hegemony of markets is not a technocratic process, but a political process. Conflicts and struggles are always a part of this. The process of capitalist transition takes place in a particular society within its own history. This means that capitalism is not some sort of model. It is shaped by political struggles and historical processes in a particular context.

Since the socio-economic impact of capitalism is always unequal, in Sri Lanka various sections of the Sinhala majority benefitted more than others from capitalist transition. In other words, although the Sinhalese were unified in ethnic terms, they were divided in class terms. The inequality generated by capitalist transition within the Sinhala majority could always combine with the Sinhala nationalism that legitimised the state to oppose the regime in power. The opposition to regimes could also turn into an opposition to capitalism, and a general opposition to the state itself. In order to meet this challenge, the post-colonial state developed a number of policies. These are what is usually called ‘welfare’ policies. The use of the term welfare ignores their strategic role as a technique of state formation. This makes it easier to argues that these policies are luxuries we cannot afford.

The ability of the state to continue with these policies depends on the performance of the Sri Lankan economy within global capitalism. In post-colonial historythere were several instances when this strategy of state formation broke down, resulting in protest, sometimes violent challenges to the state and state repression. At present we are witnessing another such instance because the Sri Lankan state was unable to satisfy the demands of global financial capital. This is happening in a society with the socio-economic impact of three decades of armed conflict, and four decades of more liberal economic policies. The latter has resulted in an increase in socio-economic inequality. Instead of trying to make use of this opportunity to rethink social policy while restoring economic growth, what prevails are the same old ideas of safety nets and, of course, state repression.

To end this short piece, I would like to emphasise that there is no one big answer to Sri Lanka’s problems. The outcome of answers to one issue can contradict answers to other questions. In addition, the analysis of the present must be done with a historical sense. Many are preaching single-factor answers for various reasons. Some are simply a reflection of self-interest, and nothing more. It is time to shift this debate, so that we can take into account of the complexity of the situation.

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Politics of capitalist transition and state repression

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Capitalist transition within a state is a process that involves changing institutions or the ‘rules of the game’, so that markets become the primary mechanism for resource allocation. These changes must be legitimised at an ideological level. When institutions to establish markets are successful, they become ideas that seem to be natural and common sense, thereby creating a hegemony.

The establishment of the hegemony of markets is not a technocratic process, but a political one. Conflict and struggles are always a part of this. These conflicts can be violent. The process of capitalist transition takes place in a particular society within its own history. This means capitalism is not some sort of a model. It is a historical process, influenced by political forces in a particular historical context. It takes place in a context of global capitalism.

Institutional changes to promote markets create social classes. Since the socio-economic impact of capitalism is always unequal, in Sri Lanka, different sections of the Sinhala majority benefitted unequally from capitalist transition. In other words, although the Sinhalese were unified in ethnic terms, they were divided in class terms. The inequality generated by the capitalist transition within the Sinhala majority could always combine with Sinhala nationalism to oppose the regime in power. In a political space defined by ethnicity, the Sinhala majority was the deciding factor who came to power thorough elections. The opposition to regimes could also turn into an opposition to capitalism, and a general opposition to the state itself.

Post-1977 is a new period of capitalist transition in Sri Lanka. It emphasised markets, the private sector and openness to global capitalism. It changed the process of capitalist transition from the state-dominated capitalism that characterised the 1970-77 period. Political leadership to the process was given by J.R.Jayawardene led the United National Party (UNP) in 1977 general election. Jayewardene saw the challenges that economic reform will face from the Sinhala majority long before 1977. In 1966, in the keynote speech to the 22nd annual session of the Ceylon Association for the Advancement of Science, he argued for the need to establish a directly elected president to carry out unpopular economic reforms. A powerful president would be elected directly for a fixed number of years and be able to face opposition to economic reforms.

The UNP won the 1977 election securing 50.9 per cent of valid votes. This translated into 140 seats in a parliament of 168. In other words, it gave the UNP, a degree of political power that was disproportionate to their voter base. At this point it is worth recalling how UNP the brought about this major change in institutions controlling the Sri Lankan state using this power. Prof. A. J. Wilson’s book The Gaullist System in Asia: The Constitution of Sri Lanka (1978), give details of how this happened.

The election was won in July 1977. On 22 September 1977, the government put through an amendment to the 1972 constitution that established a directly elected president as the head of state. Jayawardena, who was elected as prime minister in 1977 general election, became the first president. This bill was not even discussed by the government parliamentary group. It was discussed only at cabinet level, adopted by what then was known as the National State Assembly, and certified by the Speaker on 20 October 1977. There were only six speeches in parliament when this fundamental change to the structure of the state was instituted. Then a parliamentary select committee was appointed in November 1977 to draft a new constitution. This was totally under the control of the UNP. The select committee held only 16 meetings. There was no serious effort to get public participation. A questionnaire that was circulated received 281 responses. Sixteen organisations and a Buddhist priest presented evidence before the committee. The report of the Select Committee was tabled in June 1978, debated in August 1978, and the 1978 constitution became law in September 1978.

It is clear that what determined the establishment of the constitution that still rules over us was the political power enjoyed by the UNP. Often the key role played by the balance of political power in establishing these institutions get masked by discussions on legal aspects. Balance of political power is the key in forming constitution. Linda Colley’s recent book The Gun, the Ship and the Pen demonstrates this, by analysing the history of constitution making in many parts of the world.

Once established, controlling the presidency became the most important political objective for the Sinhala political elite who controlled the state. Although politicians criticised the presidency when out of power, they were reluctant to give up this power when they became president. A powerful presidency existed in a society where there was little possibility to challenge the power of the president through societal mechanisms. In addition, factors such as patronage politics, which seeped into all spheres of social life, and a traditional attitude of looking towards powerful leaders for solutions, made this office even more powerful. As soon as this kind of powerful centre of power was created, these factors generated a political culture based on loyalty towards the centre and the person who became president.

The second institutional mechanism that enhanced the despotic power of the state was the Prevention of Terrorism Act (PTA). This was established just one year later, in 1979, to deal with the Tamil separatist threat to the Sri Lankan state.  It also normalised a discourse of terrorism. Although it came about because of a different issue, it has been used to deal with opposition to economic reforms in Sinhala majority areas. Reforming it, or totally getting rid of it, has been a consistent demand from those who have opposed state repression. But, even after four decades, the political elite who control the state is not ready to give up the power that the PTA provides. In post-war Sri Lanka, the power that presidency and PTA give to the political elite who control the state, is enhanced by well -developed security forces. These now absorb a significant amount of resources of a state facing fiscal problems.

The presidency and the PTA have been part of the Sri Lankan state for more than four decades. An account of the social impact of these in Sinhala majority areas is a study on its own. What we have is largely reports of individual incidents and numbers. A social history of this violence will reveal the true nature of state-society relations in Sinhala majority areas in the post 1977 period. This is a task for future researchers. We need similar research on the social impact of efforts to consolidate the territory of the Sinhala nationalist state threatened by Tamil separatism.

This year, the inability of the Sri Lankan state to satisfy the demands of global financial capital has led to social unrest. This is a part of a global capitalist crisis. Several other factors, like the situation Ukraine, have complicated the situation. A BBC news item reports that there have been various forms of social unrest because of economic discontent in 90 countries. For those who know the history of capitalism, this is not a new situation. What is important is to focus on is how the ruling political elite respond to the situation. In the case of Sri Lanka what we are witnessing now is a repetition of the same strategy of dealing with protests by using the coercive power of the state provided by the presidency and PTA. The scale of suppression might be different from what happened in the past, but the political economy is the same.

A key demand for any kind of progressive movement in Sri Lanka in this situation should be getting rid of both the presidency and PTA. It should be total removal of these institutions and not any kind of reform. The latter only goes to further legitimise these institutions.  Continuous criticism of the various discourses that currently legitimise these institutions will be essential. For example, the use of the term political stability, without clarifying how this to be achieved is opening doors for state repression. Instead, what we need is a regime that seeks to establish political legitimacy with a new social contract. This is necessary not only to promote democratisation, but also to promote social justice and pluralism.

Views expressed are personal

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Sri Lanka: Towards a political vision combining social justice and pluralism

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The post-war Sri Lankan state’s inability to fulfil the demands of global finance capital has devastated the lives of millions of Sri Lankans. This is a country where we see the socio-economic impact of the new period of capitalist transition that emphasised the private sector, markets and openness to global capitalism for more than four decades. The other dimension that has had a wide-ranging impact on society has been three decades of a military strategy to consolidate the territory of the centralised Sinhala nationalist state. This began in 1979 with the enactment of the Prevention of Terrorism Act and sending troops to the North and was achieved in 2009. A full understanding of the social impact of this dimension needs a lot more research. If we add to these the impact of COVID and the economic crisis we get the full picture of the socio-economic issues that people within the Sri Lankan state are facing. Of course, the impact of these issues is mediated through the social structure. Therefore socio-economically marginalised population is facing a worse situation, and their condition is bound to deteriorate further.

The media is full of analyses and answers to these problems. But as one of my favourite Critical Theorists – Robert Cox – who worked in international political economy, says all analyses are done for someone and for some purpose. There is no politically neutral analysis. The bulk of the discussion is geared towards restoring capitalist growth. Often this is accompanied by a desire for what is called political stability. But advocating political stability without defining how this is to be achieved, in a country where we have seen thousands of deaths through state repression, is not only dangerous but downright reactionary. Rather than political stability, we need to talk about political legitimacy. A regime that has a greater degree of political legitimacy can give leadership to developing a new social contract, which is essential for Sri Lanka to face the current situation. This note is aimed at the social and political forces that have begun to challenge existing orthodoxies in the current context. These protests are found cutting across ethnic groups. It aims to combine social justice and pluralism and point towards new areas where progressive politics can be strengthened.

In a situation where wages become a major source of income, education and skills development becomes a critical area for social mobility. State monopoly on education was broken in the new period of capitalist transition

To begin, we need to consider the impact of more than four decades of the more liberal period of capitalist transition. The bulk of the economy is concentrated in the Western Province, which was better endowed to benefit from the new directions in the economy. Central Bank data shows that in 2019 these areas accounted for around 39 per cent of the total national output. According to the Household Income and Expenditure Survey of 2019, which managed to cover the entire territory of the state because it was unified through military means, 11.9 per cent of the households in Sri Lankan live below the official poverty line. There is a great degree of variation in this indicator between districts. While Colombo district had 1.8 per cent of households below the poverty line, the Mullativu district in the Northern Province. it was as high as 39.5 per cent of households. This area has also been affected by three decades of armed violence. In reading this data it is necessary to remember that the poverty line, as defined by the state, measures a basic minimum a household needs for survival, although it is propagated as a great achievement in development. What these figures show is the proportion of the population who could not secure even this basic minimum.

With the deepening of capitalist relations of production, there have been significant changes in the agrarian sector. The share of agriculture in the economy has significantly declined. In 1977, 30.7 percent of the national output was from agriculture. By 2019 it had declined to 7.0 percent. There has been a gradual deterioration in the viability of smallholder paddy. The 2019 Household Income and Expenditure Surveyshows that only 8.6 per cent of income in the rural sector was from agriculture.Further reforms in capitalist transition backed by international actors will try to promote markets relations in state land. This will make it even more difficult for the smallholder peasantry to earn a living from their land.

The other side of this rural transformation is the growth of a population depending on wages. The growing working class is found in multiple socio-economic formations – organised, informal, sub-contractors, etc. A significant section of this labour are women. Some sections of the working class sell their labour in other countries. While the working class has grown, institutions that protect their rights and working conditions don’t operate in many sectors. What existed in the past has been gradually dismantled. The effectiveness of these institutions depends a lot on the presence of trade unions. But the working class is not organised in all sectors. On the other side, business interests will continue to try and dismantle the remaining institutions that protect rights of the working class.  

It is necessary to pay attention to the austerity measures that are sure to follow an agreement with the IMF.

In a situation where wages become a major source of income, education and skills development becomes a critical area for social mobility. Since the state monopoly on education was broken in the new period of capitalist transition, the role of the private sector in education has expanded. This has become a new avenue where richer classes can ensure an education for their children. In addition, the state sector is not an equal system. Therefore, both private sector education and state education provides more opportunities for the richer section of population to provide a quality education for their children. The cumulative effect of these changes has been the growth of a significant level of inequality. Data for 2019 show that while the richest 20 percent of the population acquired 51.4 percent of national income the poorest 20 percent had only 4.6 percent.

The answer to these socio-economic issues from those whose main agenda is restoring capitalist growth in the current context, is the same old idea of protecting vulnerable groups that we heard 40 years ago. The foundation of this idea is the notion of growth and trickle-down. Sometimes these policies are called targeted safety nets. The argument is that these policies are meant to safeguard the poor from the impact of capitalist reforms. This is supposed to be the main role that the state should play vis-à-vis the poor – in the long run, economic growth would take place, and the benefits would trickle down to the poor. The analysis that underpins these ideas always focuses on households in isolation from the structures of socio-political power that maintain this population in this condition in the first place. Therefore, it takes us away from the need to tackle the reasons for marginalisation.

During the new period of capitalist transition that emphasised markets, private sector and openness to global capitalism, all sections of the Sri Lankan population did not accept these ideas of safety nets propagated by the political elite and their international backers. That is why there have been struggles in various sectors, such as the urban working class, plantation working class, sections of smallholder peasantry, fisheries, etc., to improve their living conditions by challenging the structures of power that maintained existing the social relations of production. The entry of women’s groups into these struggles added a new dimension. Of course, there were setbacks, such as state repression of the July 1980 strike. At present what is needed is to take a close look at this experience, learn lessons and look for possibilities of reviving these struggles.

Finally, it is necessary to pay attention to the austerity measures that are sure to follow an agreement with the IMF. In approaching this question, it is important to remember what we have is a post-war state. The result of more than four decades of the new period of capitalist transition and three decades of armed conflict has been the growth of armed forces and proliferation of state institutions at several levels. Today the institutional structure of the centralised Sinhala nationalist state has institutions at presidential, parliament, provincial, districts, sub-district and local authority levels. Almost all these levels include elected members and a bureaucracy. In addition, institutions of the central state have undergone numerous divisions. One of the reasons has been the need to maintain coalition regimes and large cabinets.The strategy of the political elite has been to divide state institutions and distribute them among coalition partners. State is bound to give priority to ensure resources for these institutions in implementing austerity. The objective of progressive sections should be to focus on how policy changes will affect the marginalised, and counter possible negative impacts.

During the new period of capitalist transition that emphasised markets, private sector and openness to global capitalism, all sections of the Sri Lankan population did not accept these ideas of safety nets propagated by the political elite and their international backers.

If we are to go by the past experience in Sri Lanka, the politics of economic reforms to ensure capitalist growth need not be peaceful. We need to remember that the state has draconian laws and a better-developed security apparatus to meet any challenges to these reforms from society. As in the past, the political elite is more likely to use this repressive apparatus to achieve their own political objectives, rather than aim towards political legitimacy through a new social contract.

Beyond reconciliation

As pointed out at the beginning of this note,policy discussions on social justice should not ignore the political demands that have been raised by ethnic minorities right throughout the post-colonial period. While the political elite inaugurated the new period of capitalist transition after the 1977 elections, the Tamil minority demanded a separate state in the same election. One of the responses of the centralised Sinhala nationalist state, that presided over the new period of capitalist transition was to enact a Prevention of Terrorism Act (PTA), establish a discourse of terrorism and send troops to the North-East. This military effort lasted for 30 years, and in 2009 the territory of the centralised state was consolidated. But none of the major issues in relation to minorities and the centralised Sinhala nationalist state have been resolved. In fact, in some areas, the situation has worsened for example, with the Muslim population becoming a target of extremist violence. 

At present some of the key aspects that the ensure security of the post-war state are maintaining the strength of the armed forces, continuing a presence of armed forces, especially in the Northern Province at a level higher than when Tamils demanded a separate state, and keeping the PTA in the statute books. In this context various activities under the title of reconciliation become an element to stabilise the post-war state.

The focus of reconciliation is society, rather than the nature of the state and state-society relations. Although there is an element of prejudice and animosity between identity groups in Sri Lanka’s conflict, they exist in a context of a centralised Sinhala nationalist state. Ignoring this within the discourse of reconciliation means ignoring the need for fundamental state reform focusing on its identity, public policies and structure to suit a multi-ethnic society. What we need is not a nation-state with a unified identity, but a state that has space for multiple identities. Its structure and public policies have to fit into this vision.

Given the socio-economic impact of the economic crisis that is affecting all ethnic groups at present, there is space to focus on a strategy where diverse ethnic groups come together to struggle for common socio-economic rights. This can give a new meaning to reconciliation and combine social justice with a vision of a plural society. There are scattered examples of this happening already. For example, every year we see demonstrations by the mothers of the disappeared from the North (victims of the military strategy to consolidate the territory of the Sinhala nationalist) and South (victims of the state repression in 1989/90). There have been some links between them. But this certainly can expand. During my work in the North/East after the war ended, I have seen examples where people from a Tamil village and adjoining Sinhala village come together to lobby state institutions to restore their land documents. Another example is Muslim and Sinhala villages coming together to lobby about supply of water in the irrigation canals. There can be many such examples that can built upon. These are small examples. In the current context there is space to build on this strategy.

To end this note I would like to emphasise the need to get away from an analysis that places class and ethnicity in isolated compartments when dealing with the problems of the marginalised in Sri Lanka. In this regard, my best personal experience has been when working with the plantation working class/Hill Country Tamils. There was no way one could separate ethnicity and class at analytical or political level when working with this population. The struggle for political,socio-economicand right to a distinct ethnic identity had to go together. This is an experience that we can learn from.

Views are personal

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