Halcyon days of Ceylon Shipping Corporation

By Captain Chandra Godakanda Arachchi,

Member of Company of Master Mariners of Sri Lanka

This article is dedicated to Captain P A Virasinghe, who passed away recently. He was the first Sri Lankan to command the Ceylon Shipping Corporation (CSC) ships. Appointed the Master on Lanka Kanthi in 1972, he was instrumental in getting the things right and raising the bar for future deck officers and marine engineers.

The CSC, established about five decades ago, was thriving with a healthy bottom line; it continued to serve Sri Lanka with our own managers and seafarers to run our ships.

Although SL was self-sufficient in rice before the advent of colonialism, rice production gradually dropped, under the British occupation, due to the neglect of the major irrigation tanks built by kings. Rice had to be imported to meet the shortfall in supply. Shipping companies in the 1950s and 1960s increased freight rates, sending rice prices up, and that became a political issue as well. Labour unrest caused delays in loading and discharging in our ports made shipping companies increase rates. A line of ships can be seen anchored around the Colombo Port, waiting to be berthed. The cost of these port delays is passed on to the public. So, during the aforesaid era, discussions were held to decided how to keep cost of living low, and one of the solutions was to have our own national carrier owning ships besides tackling trade issues and improving labour relations in ports

Previous attempts by the state to own ships had failed, but finally a team of capable officials was tasked with drafting a business plan for owning a fleet of ships. Consequently, a feasibility study was carried out and a report, “Feasibility Report on the Establishment of a National Merchant Shipping Fleet”, was produced. The report indicated that there would be substantial returns on investment. The Ceylon Shipping Corporation (CSC) was thus established in February 1969; it later became a statutory corporation upon CSC Act no 11 of 1971. P. B. Karandawela, who was the General Manager of CSC, was appointed the Chairman of CSC in June 1970.

The CSC, having recruited highly competent senior managers, proceeded to acquire vessels, the first being Lanka Rani (acquired in January 1971). Five ships had been acquired by end 1972. It is interesting to note that Lanka Rani was registered in the UK at the time as Sri Lanka Merchant Shipping register was yet to be finalised. Lanka Sagarika was registered as the first Sri Lankan flag vessel. The CSC rapidly expanded its services including chartering ships and liner agency services, etc. In early 1970s, country’s foreign exchange earnings were on the decline due to a drop in the prices of our main export commodities, tea, rubber and coconut, in the world market. The CSC was a blessing as hundreds of ships charted through CSC to import commodities, rice, flour and sugar, etc., saving vital foreign exchange for the government at the time.

The CSC liner services at the time were mainly to the UK/Continent and Far East. The CSC fleet continued to grow with a policy decision being taken to train our own seafarers, improve labour relations in our ports, and establish the Freight Bureau, etc.

Following a proposal by legendary Marine Officer Victor Peiris, the vessel, Lanka Kalyani, was dedicated to training Cadet Officers et al. The late Commander M. G. S. Perera, who served as the Staff Captain to train cadets on Lanka Kalyani, was a great teacher. His pupils went on to hold high positions in the industry.

The establishment of the Ceylon Freight Bureau (CFB) marked a watershed, which helped stabilise port activities; offering commissions to forwarding agents and shipping executives had been the norm before the CFB came into being. The CFB also offered maximum load for export cargo on CSC ships. All import government cargo particularly from the UK and continent were loaded on CSC ships. The CSC accepted export cargo even from small-time exporters without discrimination, and thus country earned the much-needed foreign exchange. The CSC fleet continued to grow and included a tanker to bring crude oil for our refinery.

Protection that the CSC received from the CFB during the early stages had to come to an end after being in operation for a reasonable period of time. Politics took its toll later and all the good work done by the CSC was gradually undone. The CSC would have developed like Neptune Orient Lines (NOL) in Singapore, which commenced operations a couple of years prior CSC and grew, merging with major shipping companies in the world.

The CSC’s success was due to efficient management and the dedication of all its workers. Feasibility studies were properly conducted; legal aspects of its affairs were carefully managed and its ability to pay back loans was ensured. The Sri Lanka Ports Authority (SLPA) should emulate this example. Having come a long way since early 1980s, when containerisation commenced, the SLPA is not doing well as for the diversification of business; it is only concentrating on local transhipment business. It should have been able to invest in other countries by now.

The CSC-trained seafarers are grateful to the CSC and wish it and its staff success in all their endeavours.