Mahiyangana Colonisation Scheme

From TobaccoUnmasked


In 1965, Dudley Senanayake Government introduced the Special Leases Scheme under the “National Food Production Drive”. Uncultivated land was leased to 12 private companies for 25 years for cultivation. Most of the land were virgin forest areas of the dry zone, in the banks of Mahaweli river in Mahiyangana.[1][2][3] Tax concessions and duty-free facilities were given for the leaser companies. The project was coordinated by the Ministry of Agriculture in collaboration with Ministries of Land and Finance. Reportedly, most companies cultivated commercial crops, even though the initiative was to cultivate food crops. Controversies were also reported about the selection process of the private companies for the scheme.[3]

Under this scheme, Ceylon Tobacco Company PLC (CTC) leased 1000 acres of virgin jungle land in Alutharama.[1] It was later documented as their first ever social investment in Sri Lanka.[4][2] However, according to the report by Agency for International Development (AID), “CTC did not have a detailed implementation plan, nor did it state in advance the outputs it hoped to realize or the length of time it intended to finance MCS”. [1]

CTC Investment

According to the AID report, CTC leased the Lot No. 12, which was “covered with thick jungle, occasionally disturbed by chena (shifting slash-and-burn cultivation)”. Starting from 1966, CTC cleared 527 acres of the land and established an agricultural settlement named Mahiyangana Colonization Scheme (MCS).[1] In 1969, CTC officials selected 59 individuals from the labourers who were employed to build the settlement to settle in the MCS. All settlers were Sinhalese and 80% were Buddhists. The settlers were given electricity and running water from the CTC. The settlement also included necessary services such as a day care centre, a community centre, a dispensary, a school and a corporate society.[1] In 1975, electricity was withdrawn due to high costs and settlers were given Petro-max lamps. Running water was also withdrawn because settlers were using the domestic supply to water the cultivation. On August 1980, the MCS was officially turned over to the Mahaweli Authority of Sri Lanka (MASL).[1]


CTC claims the project was successful and had lasting impact on the settlers.[1] [2][4] However, several reports give evidence to contrary as mentioned below.

  • The AID report concludes that the model is not to be replicated as the settlers were not developed as a community;[1]

“In short, we found little evidence that the colonists developed elements of a self-reinforcing community with its own leadership and institutions, as opposed to a collection of individuals who happened to be settled near one another, despite 11 years (1969-1980) under CTC and 4 subsequent years under MASL. Some interfamily work groups (through intermarriage) and a general feeling of belonging to the landed gentry are the extent of any sense of community”.

  • Senevirathne, criticizing the whole SLS project, also criticizes CTC for being inefficient in managing the project and destructive to the environment;[3]

“Despite being the most mercenary and exploitative commercial enterprise in this country (as elsewhere) it hired a foremost agronomist, Dr. Ranjith Mulleriyawa, to run its ‘Farm’ in Alutharama. He began to establish a Farm there with small-scale irrigation systems, good seed and all. His employers were unhappy - that wasn’t what they had in mind. He was fired and a District Land Officer, Cedric Forster, whose knowledge of agriculture was probably nix, was brought in. He delivered the goods: aerial fotos of ‘before’ (jungle) and ‘after’ (clouds of dust whirling over that denuded land).”

Tobacco Unmasked Resources

Other relevant TobaccoUnmasked entries:


  1. 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 GT Eaton, KL Merry, J Albert. A STUDY OF TWO SRI LANKAN RURAL DEVELOPMENT PROJECTS MANAGED BY THE CEYLON TOBACCO COMPANY LTD, A.I.D. Project Impact Evaluation Report No. 60, March 1986, accessed May 2017
  2. 2.0 2.1 2.2 DailyFT. CTC: Down memory lane, 11 August 2012, accessed May 2017
  3. 3.0 3.1 3.2 G Seneviratne. Vignettes of the Public Service COMMERCIAL AGRICULTURE, The Island Online, 06 April 2008, accessed May 2017
  4. 4.0 4.1 A Razak. CTC accomplishes goals of flagship community project,, 20 September 2009, accessed May 2017