Foreign Aid & Sri Lanka's  Military Expenditure

Open Letter to Paris Aid Group
from Castis (Campaign Against State Terrorism)
April 1995

The Paris Aid Group, part of the World Bank, consists of representatives from Western donor countries who meet annually in Paris, to reward countries like Sri Lanka for implementing the economic line of the IMF and the World Bank.

This includes the continuous process of "restructuring" the country's economy in line with the so-called "Free-Market", which means the West has complete access to the market in Sri Lanka and other countries like it, the promotion of privatisation, the destruction of social services and keeping wages extremely low so that multi-nationals can reap the profit. This has political repercussions and in Sri Lanka has a central effect on the Human Rights situation.

The following is the statement and request sent to the Paris Aid Group delegates by CASTIS (Campaign Against State Terrorism in Sri Lanka) and our sister group based in Germany KMSLTE (Kampagne fur Menschenrechte in Sri Lanka und Tamil Eelam).

To the delegates of the 'Paris Aid Group' meeting on the 27th April 1995:

It must be clear to all those involved with the 'Paris Aid Group' (PAG) that the amount of financial aid underwritten on the 27th April will have enormous political consequences. For different people the consequences are different.

For the Sri Lankan government, a large amount agreed by the PAG is critical not just in financial terms but also as a political weapon. Each Dollar is used as proof to show the people in the island that the most powerful countries in the world are supporting the Sri Lankan government in the most concrete of ways - with hard cash.

However, for the Tamil people, especially during the last decade, the awarding of larger and larger amounts of money to the Sri Lankan government has been cause for increasing dismay. In the Sinhala majority South West too there is deep suspicion as to who really benefits from the aid.

Even the universally welcomed peace talks between this Sri Lankan government and the Liberation Tigers of Tamil Eelam has had the issue of money from the 'Paris Aid Group' running through the process as a barely concealed sub-text. At the early stages of the peace talks, when Chandrika Kumaratunge's government appeared to agree to a 800 million US $ development package to start to rebuild the war ravaged North many people were stunned.

This is because the last 'Paris Aid Group' underwrote just about this figure to Sri Lanka. Is it possible that a Sri Lankan government is going to spend all of its foreign aid on the Tamils in Jaffna?

The credibility of this proposition is somewhat undermined when you considered that during the period 1977-1982, a period before the armed conflict began in earnest, (before 1983) the foreign aid utilisation in Jaffna was nil! Is it to believed that foreign aid, which was what underpinned the power of the Sri Lankan military - the power to bomb Jaffna to destruction - is suddenly to be used for the benefit of the Tamil people in Jaffna?

At this stage, let us examine briefly the peace process the background to it and its breakdown. Chandrika Kumaratunge came into power , and one of her promises was to solve the 'ethnic conflict'. The war weary people both in the Tamil majority North East and in the Sinhala majority South West were hopeful of some progress in this direction.

Peace talks taking peace all over the world between former protagonists were hailed as an extra reason for optimism. The Tamil people had suffered immensely during the last phase of the war which started in June 1990. It is estimated that over 20,000 Tamil people lost their lives during the period June 1990 to June 1994. Blanket bombing had destroyed the hospitals, schools, churches and Temples and thousands of houses.

No electricity, proper water supple scarcity or food and medicine meant that the day to day life for the Tamil people was extremely difficult. An economic embargo by the Sri Lankan government meant that the day to day life for the Tamil people was extremely difficult. An economic embargo by the Sri Lankan government meant that oil and even batteries for radios were not available. Listening to the radio meant turning the wheel of a stationary bicycle to activate the small 'dynamo' to power the radio. Listening to overhead planes approaching and running into underground bunkers was a daily routine. It is clear that the Tamil people wanted peace.

However, it was the mainly Sinhala people who elected Chandrika. In the densely populated Jaffna peninsula the Tamil people boycotted the elections. The Sinhala people were promised a demilitarised and more human government. The Sinhala people too had suffered at the hands of the earlier UNP government. About 60,000 Sinhala people were slaughtered by the regime in 1989 to crush the rising against poverty and the Indian intervention. So, in the Sinhala majority South West of the island too there were strong reasons to hope for change.

The Liberation Tigers of Tamil Eelam released 10 prisoners (Sinhala military) as a gesture towards peace. The LTTE called for a cease-fire and took the initiative to push for a durable peace. President Chandrika Kumaratunge, sent people appointed by her (unfortunately not elected people with political responsibility) who generally agreed to the basis of the LTTE's initial demands.

The LTTE had asked to lift the embargo and fishing restrictions and removal of large military bases in the middle of Tamil areas so the basis could be laid for an easing of the hardship and isolation that the Tamil people faced and thereby reducing the tension also.

Although Chandrika appeared to agree with this the Sri Lankan military were completely opposed to it. In fact the military was opposed to even temporary peace, as they argued that a period of peace will give the LTTE breathing space to reorganise. This way of rationalising shows that the Sri Lankan military feels that to stop the continuous bombardment of the Tamil people is bad in principle! However the Sri Lankan military needs the financial aid to continue with the war.

According to Paul Isenman, the director of the World Bank for south Asia

'In 1992, 60% of donor aid had been diverted from key areas including power, telecommunications, health and education'.

If he means 60% of the total amount underwritten by the 'PAG' in 1992, then the sum that was diverted to the military would be 500 million US$!!

In any case what is important is not detecting exactly how the money is diverted by the fact that the money is there in the first place.

To put it simply the PAG underwrites 800 million US$, the Sri Lankan regime spends say 450 million US$ on the war drive. If the regime doesn't get the money from the 'PAG' how is it going to continue with the war?

This is how the apparent contradiction between the position of Chandrika Kumaratunge and that of the Sri Lankan military hides a basis for unity. The politics of the 'big lie' used by successive Sri Lankan governments come in to play now. Chandrika, in saying that it will spend 800 million US$ for the North and East lays the basis for asking for even more money at the 'PAG'. Then just after the aid has been agreed the military can impost its solution.

Only this rationale can explain the fact that in practice none of the agreements that Chandrika's government came to were implemented. Although the embargo was supposed to be lifted virtually nothing passed through the military checkpoints. The military was gearing up and massing troops and equipment and getting ready to encircle the Jaffna peninsula. They were not going to allow anything to get through that might release the pressure on the Tamil people even for a short time.

The Sinhala people were told that there would be peace. So the had to be prepared for war again. This is why during the last few months, when the peace talks were in full swing, and therefore the best time for understanding, the press campaign against the LTTE grew to hysterical proportions. The LTTE was blamed for putting obstacles in the path to peace, and the climate was being set to blame the LTTE for the commencement of the war.

There are telltale signs of this whole process at various levels. After a pep-talk by leading army commander, 80% of the soldiers put up their hands when asked directly as to whether they preferred war to peace. This kind of racist atmosphere within the armed forces led to an unarmed LTTE cadre being beaten and humiliated to such an extend that (on the 29th March) he took his own life by taking cyanide. Just before the LTTE withdrew from this one sided peace process a peaceful commemoration near Batticalloa in honour of Kanapathypillai Poobathy (Poobathy Amma) who died on hunger strike during the Indian occupation, was brutally attacked with tear gas and batons.

As far as the 'South' is concerned, Chandrika Kumaratunge came into power promising peace and promising that the poor masses will be treated better than by UNP regime before it. She promised to increase the standard of living and improve the human rights situation and promised 'capitalism with a human face'. Although she has kept part of the promise - the capitalism part - the human face has yet to be seen.

People naturally have protested with mass strikes in the 'free trade zones' and demonstrations against press censorship and students right. Already two people have been killed - due to police shooting during peaceful demonstrations - since this government came into power. One of the main universities - the Jayawardenapura University has been closed down completely and Colombo University is partly closed. Strikes are still taking place in Korea Ceylon, Creations Garments, Palwatte Sugar Company and Magpek.

The government, instead of solving the problems of the people, which has become worse since it came into power, is blaming the JVP (People's Liberation Front) for all the problems in the south. The viciousness of the political attacks are increasing daily, S. B. Dissanayake a cabinet minister had said that what had to be done is to abort the yet to be born new JVP. He is a member of the government's 'Defence Committee' which has much influence on the activities of the armed forces. In this way the government is trying to lay the basis to push the JVP out of the democratic space and, if their words are to be believed, to use military force to exterminate it.

The stage is set also through the racist propaganda in the media, the basis for it we explained before, to turn the hatred of the Sinhala poor against the Tamils. The real beneficiaries of the aid, the military and those who push the military option are the forces that push the racist propaganda, which basically says that the Tamils cannot be allowed to be free, they must be under Sinhala control. The message is - if they do not accept these conditions, we will destroy them.

Just as we write this, a massive attack by the Sri Lankan armed forces based in northern Palaly is taking place. Over 5,000 Tamil civilians have been displaced from their homes. A 'Pucara' bomber plane, supported by helicopters is taking part in the attack. A Hindu temple and many houses have been substantially damaged.

We ask the 'PAG' delegates, in this open letter, not to strengthen the armed forces and racist hysteria that must go with it by awarding financial aid to Sri Lanka but to use their influence to push forward the peace process - which we feel the Liberation Tigers of Tamil Eelam are genuinely concerned with.

However, the PAG, knowing all of this, gave the Sri Lankan government 850 million US$ on 27 April 1995.

For more information on the campaign and the situation in Sri Lanka, please contact: CASTIS c/o Church of the Ascension, Royce Road, Hulme, Manchester, M15 5AL,England