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Navy scores on high seas as land war drags on
By our Defence Correspondent
Far out at sea, the officer commanding the naval squadron peered uncertainly at the ominously big dark shape up ahead, looming threateningly out of the darkness.The six navy Dvora-type fast attack craft were protecting a vital convoy of ships moving from Trincomalee to Kankesanthurai. They had left at dusk on Sunday, November 8, and keeping well away from the coast, proceeded northwards. Now they were just passing LTTE-held Mullaittivu, and were about fifty miles from the beach. The time was 1 A.M. on Monday.
A few minutes before, radar had picked u the large vessel on screen. From its course, it seemed to be heading northwards, towards the Indian coast. The navy boats, intent on protecting the convoy, headed towards it, trying to discover, whether it was a merchant vessel, possibly heading for a South Indian port, or if it could possibly be an enemy. The latter was considered unlikely so far out at sea, and the radar blip was far larger than that given off by a normal sized Sea Tiger boat. But as the fast attack crafts drew closer, their crews realized that the unidentified vessel was steaming without any lights, a sure sign that it was trying to get by unseen.
Large boat
From its size, it appeared to be a very large boat. The lead Dvora moved closer, and fired a burst of gunfire across the bows of the vessel. Instantly, gun flashes lit up the night, as the quarry fired back. The Dvora turned away quickly undamaged, and rejoined the other navy craft, which had moved forward as soon as the enemy fired.From the flashes, it was clear that the guns being fired were of far heavier caliber than the five-zero type shell-firing machine guns which almost all Sea Tiger craft are equipped with. These heavy guns now presented a greater menace to the navy boats. As the navy boats grouped into an attack formation, alert radio operators picked up urgent messages being transmitted in Tamil from the big boat, which had now turned and was heading back towards Mullaittivu. The enemy was calling for reinforcements!
Immediately, unknown to the navy flotilla, four fast Sea Tiger craft streaked out of Chalai, a base slightly north of Mullaittivu, and raced at top speed towards the fighting. The Dvora squadron swept forward from all sides, blazing at the enemy vessel with their 20-millimeter and five-zero guns. The enemy replied with heavy gunfire of its own, and to the navy’s surprise, the flashes came from all four sides of the boat. This was peculiar, since most LTTE combat vessels only have guns in front, or both front and back. Realizing that such a large boat armed with heavy guns on all four sides was surely carrying something very important, the Dvoras raced in for the kill, intent on destroying it before enemy reinforcements arrived.
Difficult
But although the Dvoras were faster and had the advantage of numbers, and scored hit after hit, the enemy boat was difficult to sink. Its guns were blazing away, preventing the navy craft from pressing home the attack. The fight went on for about an hour, and only then was the enemy destroyed, sinking beneath the waves about 35 miles from land, its heavy guns silenced. Its crew was either dead, or leaped into the sea. Meanwhile, the Sea Tiger reinforcements arrived, and joined the fray. The Dvoras turned, and fought back, conscious that they had to protect the convoy from the enemy.After half an hour more of fighting, one more of the LTTE craft was sunk, and the other three, damaged, turned and beat a retreat. The naval flotilla, which had suffered no damage or casualties, did not pursue them. Their task was to protect the convoy, and they dared not stray too far from it, knowing that, in previous battles, Dvoras had been lured away from convoys while other Sea Tiger boats waited to attack the helpless merchant ships from another direction. The Tigers have said nothing to-date of the battle, and navy officers are convinced that it was carrying some important cargo or LTTE senior cadre to India.
The battle also underlined the need for the Indian navy, coast guard and air force to get much more involved in counter-LTTE operations in international waters, and around the South Indian coast. The big LTTE boat was clearly sneaking its way to India. It would be advisable for Sri Lanka’s foreign ministry to look into this matter at once. The help of police and Indian intelligence agencies in south India, both at the state and national levels, are vitally needed.
Success
The latest success, which was fought out on the high seas, in international waters, continued the impressive run of victories the navy has had off the northeast coast in the last two years, with Vice Admiral Cecil Tissera at the helm. This is despite the fact that the navy is still ill equipped, in terms of warships, for its tremendous task, due to shortsighted policies in purchasing vessels in previous years, as President Kumaratunga has publicly said. In fact, at the moment, were it not for the efficiency and dedication of the navy, the half a million people in Jaffna would have starved, as the campaign to carve a land route continues to go nowhere..Senior civil government officials in Jaffna recently issued a stringent warning to the Ministry of Defence that something must be done to restart civilian flights to the peninsula, or the government’s campaign to win the hearts and minds of the Tamil people could come to a bitter end, sources in Jaffna said. The chief concern is that, with the onset of the Northeast Monsoon this month, in a few weeks time, attempts to restart the disrupted ferry services by sea will become impossible for many months, and all 550,000 people effectively cut off from the rest of the country. Air flights to Jaffna ground to a halt on September 29, when a Lionair Antonov AN-24 carrying 55 people disappeared between Jaffna and Mannar, a few minutes after taking off from Palali.
Temporary stop
Both Lionair and Monara Air, the only two domestic airlines flying in the country at present, stopped all flights temporarily the same day. But two days later, the Department of Civil Aviation issued an order preventing any further flights to Jaffna. This effectively cut Jaffna off from the rest of the country. The sea ferry service had come to a near halt since August, when the LTTE hijacked one of the ships carrying civilian goods to Jaffna, while it was more than fifty miles from the coast of Mullaittivu. Most other ship owners decided to stay away after that, with the Tigers having proven that they could strike at will in the international shipping lanes.What is baffling is that the Defence Ministry and the Shipping Ministry have not planned out a proper method of keeping Jaffna connected to the rest of the country, despite it being nearly three years since the army captured Jaffna. The sea ferries have run on an almost ad hoc basis. Tenders for the hiring of ferries are called, cancelled, postponed, recalled, and sometimes the shipping firm selected doesn’t deliver until months have gone by. Many of the ships are found to be lacking in various essential departments, such as proper shelter for passengers from wind and rain, and enough lifejackets should an emergency arise. In any case, there have never been enough ships hired, and long waiting lists have always been the order of the day when it came to sea ferries. It is baffling why the government hasn’t purchased a fleet of ships of its own, rather than pay huge sums to sometimes unscrupulous shipping firms, resulting in a wastage of public money and gross inefficiency.
A ship with a capacity to carry about 250 people requires about eight thousand dollars per day as hiring charges. Other charges such as insurance, which must be paid by the state, bring the sum up to about ten thousand dollars a day. That’s three hundred thousand dollars a month. But the amazing part is that a brand new ferry of that size would probably cost only about one million dollars. In other words, we could buy a ferry for the money that is spent on hiring them for three months. Second hand ships would cost even less.
Not feasible
It is not feasible for the government to operate civilian planes of its own to Jaffna, of course. Setting up such an airline would require a lot more planning and organization than setting up a sea ferry service. The only government arm capable of handling such an operation would be Air Lanka. But it would not be worth the risk to have Air Lanka try to do a domestic service. This would expose the national carrier's planes to LTTE attack, and should anything happen to one, the resulting bad publicity and negative impact on tourism would be devastating to the economy. What needs to be done, from the air point of view, is to allow more private airlines to fly to Jaffna, and plan different flight paths for the planes, far away from LTTE areas. But it is imperative that the planes stick to their assigned paths. This stems from the strong belief among armed forces officials that the Lionair plane strayed off its assigned path in order to save time and fuel, went too close to Tiger areas, and was shot down.Three days after the plane disappeared, the navy found the bodies of three of the passengers floating close to the LTTE-held coastline north of Mannar. The bodies were too decomposed to recover, or identify. Since then, fishermen in the area have reported that they have found and buried or cremated another thirty bodies. Although nine of the bodies could be identified, there is little doubt that they belong to the passengers of the ill-fated plane. There have been no other reports of thirty people going missing in the area. However, up to now, no wreckage has been found. The airlines face an insurmountable problem. With the cause of the crash still unexplained, insurance companies are extremely reluctant to cover planes and passengers flying in the area. Without such insurance cover, the planes can’t fly. In addition, pilots and flight attendants are also fearful of flying to Jaffna now. Unlike passengers, who fly only rarely, airline crews have to fly the route daily, meaning that if anything happens to another plane, they will perish. The recent history of civilian flights to Jaffna goes back to the time of Operation Rivi Resa in 1995, when the air force was short of planes, after having several shot down.
Lionair, headed by retired air force chief, Air Vice Marshal Pathman ``Paddy’’ Mendis, offered its services, and flew troops and supplies to Palali for the army. After the Peninsula was captured by the armed forces, the government, eager to make the lives of the Jaffna people easier, in order to win their support, granted Lionair rights to do civilian flights to Palali.
Two flights were operated daily, sometimes more, depending on the demand. Earlier this year, Monara Air was also given permission to fly to Jaffna. It too operated two flights. Although Jaffna’s people still faced considerable difficulty in getting clearance from the Defence Ministry to travel to and from the peninsula, they were quite happy that they now had an alternative to the torturous method of going in coastal ferries, being seasick most of the time, which took far longer than flying. The four daily flights carried up to two hundred people each way.
The Russian tea market...
(Continued from yesterday)Exporters' Figures
India, for example, exported 45,913 metric tons to Russia in 1996, whereas Russia's import figures indicated 58,564.Sri Lanka's exports to Russia in 1996 were 38,224 metric tons but, Russia's import figures show 27,422. Export figures of other countries too vary from Russia's import figures. This discrepancy may be on account of time lag-shipment in one calendar year and arrival the following year - or statistical errors. While time lag may explain discrepancy between exports of some countries and Russian imports it does not explain that between Sri Lankan and Russian figures. It appears as if there is a consistent under recording of imports from Sri Lanka on the Russian side as (See Table II):
Table II - Discrepancy in Trade Figures 1994 1995 1996 Tea exports - Sri Lanka's Figures 12,666 37,987 38,224 Tea Imports - Russian Figures 10,377 27,800 27,422 Price of Tea Exports
Russia is paying a higher price for Sri Lanka's tea than tea from other countries as shown in Table III. Thus in 1996 the average f.o.b. price per metric ton of tea exports from Sri Lanka to Russia was $2655 as compared with $2004 per metric ton for Indian tea, $1304 for Indonesia tea, $1219 for Bangladesh tea and $964 for Argentine tea. Further the average price paid for Sri Lankan tea exports appears to have increased in 1996 whereas it has dropped for Indian tea. Thus the average price of Sri Lankan tea for the Russian market in 1996 was more than double that of Indonesian tea, nearly thrice as high as Argentine tea and 32 per cent higher than Indian tea. This is explained partly by the fact that a good part of Russia's purchases from Sri Lanka is processed tea which is as a rule, more expensive than bulk tea and partly by the fact that it buys some higher quality tea from Sri Lanka than from others.Sri Lanka's tea exports to Russia alone in 1997 according to Sri Lanka customs returns were as follows:(SeeTable III)
Table III - Russia's Tea Purchases from Sri Lanka 1997 Kind Volume Kg. Value Rs. Million Average Price of Kg. FOB Rs. Green Tea 95,120 25.0 262.83 Black Tea Packets 36,894,766 5,583.9 151.35 Black Tea Bags 3,827,987 1,387.5 362.46 Black Other 8,722,561 1,895.6 217.32 49,540,434 8,892.0 179.49 The greater part of the tea exports - about 82 per cent - consists of processed tea - in packets, bags and green. The curious thing however, is that packeted tea which forms 75 per cent of the total exports is the cheapest of all teas - Rs. 151.35 per kg. f.o.b. - much lower than tea in bags and green tea and even lower than bulk tea. On other hand the price is comparable with the fob prices of packeted tea to other destinations in 1997: UAE - Rs. 138.45, Jordan - Rs. 138.78, Turkey - Rs. 143.85. Libya - Rs. 154.26, France - Rs. 152.38 and Finland - Rs. 162.20.
Effects of the Russian Crisis on Tea
Russia is gripped by a deep economic crisis, which has reduced its economic growth to a minus 3 per cent in 1998, and minus 5 per cent in 1999. The stock exchange has plummeted to half its level and the rouble has depreciated from 6.28 to the dollar on August 3 1998 to 16.18 on October 12, 1998 or by 61 per cent. All the commercial banks are under pressure with their foreign liabilities exceeding their foreign assets by $5.6 billion at the end of May. The budget deficit is about 7 per cent of the GDP and the external debt $132 billion. Falling prices of Russia's principal exports is combined with a poor grain harvest and a potato blight. As the IMF and the developed countries are disappointed with the sluggish pace of Russia's economic reforms and corruption, they have suspended financial assistance.The simple fact is that Russia has no money even to pay the state employees. The treasury has no money because of poor tax collections; state enterprises have no money even to pay wages as most of them are operating at a loss and the state has ceased subsidizing them; the country as a whole lacks cash as the volume of money in circulation has been reduced to bring down inflation from 200 per cent in 1994 to 15 per cent in 1997; rarely are bills settled and overdue payments at the end of 1997 amounted to $127 billion or more than twice the money in circulation; this is in addition to the arrears in wages which were estimated at $9.5 billion in March 1998.
As far as tea is concerned, firstly Russia lacks adequate foreign exchange to purchase tea from abroad as before and second, devaluation of the rouble has raised the retail price of tea by about three times to about 150-160 roubles a kg. and reduced consumer demand. This has had adverse effects on the tea exporting countries. Reduced tea purchases at the auctions have tended to reduce prices all round and further several shippers have not been paid for tea already shipped. Sri Lanka's tea exports to Russia and the CIS countries declined by almost 10 per cent in August 1998 - from 4.3 million kg. in July to 3.8 million kg. in August; and the Colombo auctions average price of tee in August 1998 was $2.07 per kg as compared to $2.10 in August 1997. Between August and September it fell from Rs. 136.52 a kg to Rs. 126.43 or by Rs. 10.09. It is estimated that Russian buyers owe about $30 - $40 million to Sri Lankan exporters for the tea shipped previously and these exporters do not propose to make fresh exports until they get at least a part of their dues.
The depreciation of the rouble and foreign exchange difficulties, according to Indian officials, will not affect India much because tea exports to Russia are transacted in Indian rupees under a bilateral trade arrangement. This does not however, prevent a fall in Russia's purchases as a result of lower consumer demand. In fact, tea prices in South India have fallen from an average of about Rs. 65 per kg to about Rs. 45 since Moscow's devaluation in mid August. Whether the price decline has continued in October is not known. It is important to note that Russia purchased 90 million kg of Indian tea in 1997 or nearly 45 per cent of India's total exports of 203 million kg.
While the Ministry of Trade and the Central Bank consider the Russian crisis temporary, despite all the evidence against it, and the latter has ruled out direct assistance to tea exporters to Russia, the Sri Lanka Credit Insurance Corporation has been persuaded to offer to exporters to Russia insurance cover up to 75 per cent of the value of their shipments for an initial priced of four months. The Tea Board and the tea exporters will share the insurance premium equally. Whether this assistance has helped to sustain the tea exports is not officially known.
A Russian Famine
Tea exporters perhaps may not like to hear that Russia is facing a food shortage and probably a famine in some parts of the country this winter. Russia had the worst wheat crop in 40 years and this has been compounded by a plague in the potato fields. Famine looms large over the northern provinces which are far away and are dependent on outside food supplies. The Russian government has requested the European Commission for emergency food aid and it is learnt that the European Commission will send an estimated $1.2 billion worth of food to Russia before the end of the year. It is reported that the Russian government has also approached the U.S.A. government to provide food grain. In the mean time, Red Cross plans to distribute emergency aid to 1.5 million Russians this winter.Thus the prospects of tea exports to Russia under conditions of food and money shortage are bleak. If the food shortage becomes acute Russia may need tea from Sri Lanka as a donation!
(Concluded)
