Ivory Throne

by Manu S. Pillai

  Rumours, in their usual way, however, remained unrelenting. In March 1927 the Dewan was pressured into mentioning the scheme in his speech to the Sri Mulam Popular Assembly, the advisory upper house of the legislature, to assuage worries. In their response to him, its members insisted that the matter should be discussed jointly with them and the Legislative Council, continuing to believe that 1,50,000 acres of land was being isolated for an outright sale. They argued that their government really ought to be supporting local planters instead of a foreign company, which would hurt the interests of the state, unwilling to entertain the idea of a foreign direct investment in the state. They went on to add that

  [t]he proposal has created a good deal of unrest among the people. The law of diminishing returns has begun to operate in several portions of the cultivated tracts in this state and the evils of unemployment are manifesting themselves in direct proportion to the steady growth of population. In the circumstances, wisdom and statesmanship would point to the absolute necessity for preserving all available lands intact for the exclusive use of the present and future generations of the people of the state.31

  Mr Watts continued to reason with the politicians, as did the chairman of the EDB who pointed out that ‘the large majority of our people could not take up tea cultivation for the want of sufficient capital and technical knowledge’. And now here was Brooke Bond, who despite the proposal being unusual and ‘contrary to the policy of the ordinary producing company, who only spend capital on their own interests’, was happy to offer a mutually beneficial agreement that would bring with it capital, technology, as well as terms to benefit small planters in the state.32 By now news of political opposition to the project had reached London, however, where Brooke Bond, sensing risks of this nature in the future as well, decided to withdraw the scheme. In June they wrote to Mr Watts stating that

  [t]he great natural differences to be overcome in road-making in what, to begin with, would prove an unhealthy area, is an obstacle which might be overcome, but we feel that an active opposition on the part of the Travancoreans themselves, even of a somewhat unintelligent minority, would prove an insuperable obstacle to the scheme, which, for its success, must depend on the active cooperation of these very elements.33

  And thus came to an unsatisfactory conclusion the proposal to set up twenty-five tea factories in the state, bring 10,000 acres of land under the control of local planters, 15,000 in the hands of a locally registered company, with potential to create 75,000 jobs in the coming years.34 As the legendary journalist Mammen Mappillai lamented, this ‘immensely profitable agreement’ had to be put aside because ‘people who were ignorant’ of its merits ‘created a lot of heat stating that a foreign company was attempting to make a lot of profit. It is indeed a great pity,’ he added, ‘that the great majority of people could not see the brighter side; and what is more, they refused to see it even when it was pointed out to them by others!’35 Another journal lamented that the whole subject had been ‘attacked with a virulence worthy of a better cause’.36 Brooke Bond, incidentally, proceeded to sign their agreement with the Maharajah of Mysore instead, and the proposed venture was implemented in that rival state. Mr Watts, frustrated as he was, remained, however, sincerely unapologetic despite all the criticism. ‘Safe cooperation between the experienced English capitalist and the untrained man of Travancore, whereby both may work for the commonweal as well as for individual advantage,’ he declared firmly, ‘was the ideal I had in view.’37

  The scheme was projected to offer ‘new and attractive avenues for profitable employment to a growing number of intelligent young men of the middle classes’.38 In fact, it would not only have benefited the middle classes but also lower sections from marginalised castes. In 1921 the largest number of estate workers in Travancore, leaving aside Tamil labour, were Parayas, Shanars, Sakkiliyans, Ezhavas, Maravas, Pulayas, Kuravas, Kammalas, Muslims and Vellalas, numbering 12,000-odd, all of whom were from backward communities. The opening up of an estimated 75,000 new jobs would have benefitted them most, offering cash incomes, as well as access to schools and amenities set up in the high ranges by Christian missions.39 It was a great blow to Mr Watts that the scheme was abandoned merely because of shrill, hysterical propaganda. Much opposition was simply ridiculous, with one politician claiming he dreaded the desecration of hill temples and another proclaiming haughtily that ‘the native planter did not stand in need of tutelage’ from Europeans.40 ‘Are we to pour the enervating tonic—tea—into the mouths of the starving people of Travancore?’ yet another critic thundered melodramatically. ‘What they want,’ he insisted, ‘is kanjee [food] … Bitter experience has shown the atrocities of foreign settlers in Travancore—women hood-raped [sic], murder, assault etc. on poor and helpless people … If Mr Watts is an honest man let him drop the mater … Dewans will come and go,’ it was ominously threatened, but ‘The Maharani herself will come down from her exalted position and there will come a time when future generations will curse our Maharani.’41

  And so the matter was dropped.

  Right from the onset of her reign, Sethu Lakshmi Bayi had been uneasy with what she perceived as a lack of enterprise and initiative in her people. It was one thing that the British exploited India and confined its economic potential to two principal functions, namely the supply of raw materials to their industries followed by the consumption of resultant foreign manufactured products. But even within these limited parameters, there were spaces that resourceful Indians could fill and capitalise to their advantage. Since the First World War, for instance, demand for rubber had been on the rise, and cultivation of cash crops were giving substantial returns to agriculturalists. The Syrian Christians, famously ‘dynamic and flexible’, paved the way in making use of these opportunities, but the old-fashioned Nairs, who controlled most economic resources, looked down at unconventional agriculture and commercial undertakings with ‘lordly disdain’.42 Ensconced within the bubble of self-sufficiency provided by their (rapidly diminishing) ancestral holdings, they sneered at trade and anything involving ‘vulgar’ notions of profit. As early as 1820 it was noted: ‘However poor the Nair, his pride makes him unwilling to work for anyone of an inferior caste; he may perhaps act as an overseer to an opulent Christian farmer, but invariably smooths [sic] the concession by receiving a certain extent of land, not pay, as remuneration.’43 What this feudal mentality blinded the Nairs from, however, was that the winds were blowing in a new direction now, portending the speedy demise of their inherited financial security. And unless viable alternatives were found, and they dispensed with what an early nineteenth-century diarist called ‘the most exalted notions of their own nobility’, they would all be left high and dry.44

  While Travancore was one of the most prosperous states in India, its economic circumstances were unsound in the long run. It relied for most part on an agro-based export system that worked perfectly so long as industries in Britain demanded its raw output. In other words, it was a system that gained by complying with the colonial formula, never seeking therefore to overcome it even marginally. And naturally, then, wealth generated from its foreign trade, which in 1927 stood at a handsome Rs 17.5 crore, was quickly expended in the consumption of imported goods instead of being invested in profitable new endeavours; that same year the government revealed that while imports of rice, salt and other primary goods was slowly declining, demand for motor cars, foreign liquor, garments, tobacco and other such luxury items was on the rise.45 While, for example, 17,928 gallons of liquor were brought into the state in 1925, only two years later it jumped to a staggering 28,357 gallons, demonstrating precisely how Travancore was spending its money.46 Capital accumulation was abysmal, and people remained content with shipping preprocessed agricultural output abroad instead of manufacturing and creating capital and wealth indigenously. This latter development is very crucial, however, for any economy to progress into an advanced and more reliable state of prosperity. And the Maharani’s endeavour was to facilitate the c
reation of a viable framework that would bolster capital formation while encouraging her people to graduate from being accessories in profitable production to becoming such producers themselves.

  But commercial enterprise and capitalism cannot manifest out of the blue. They require, to begin with, an entrepreneurial mentality that hungers for material success with unabashed self-confidence and spirited courage. And in this Travancore seemed to be singularly deficient. There prevailed here, to quote the Maharani’s husband, ‘a ruinous feeling of complacence’,47 so that the population was by and large content with the status quo, disdaining to imperil it by taking the risks that entrepreneurship entails necessarily. In a predominantly proletarian society, aspirations were unexceptional for most part and as long as modest everyday hopes were fulfilled, most were satisfied.

  Even great families were perfectly happy to hoard ancestral riches than to invest them gainfully by welcoming minor insecurities. Sethu Lakshmi Bayi’s hopes, therefore, were to bring about a transformation in this conventional approach to economic matters. While official policy towards plantations and attendant transfers of land were reviewed, the Maharani also turned her focus to developing the primary sector. For one, since the export-led income of the state was dependant on agriculture, it was pivotal to sustain its prosperity in the foreseeable future. In addition to this, 50 per cent of the population subsisted on agriculture, and their interests needed to be improved as well as secured. The Ezhava community and its rising clout were living proof of the importance of this. Traditionally cultivators of coconut palms, they suddenly found that demand for their produce had multiplied due to manufacturing needs in the West. While earlier they supplied to feudal masters, by 1922 copra exported from Travancore was worth over Rs 1.2 crore in the global markets, incomes from which reinforced the rising political and social leverage of their community.48 Sethu Lakshmi Bayi realised that economic independence was the only sustainable formula for social change among the quarrelling classes of Travancore. And since agriculture was the principal economic activity, steps were taken to enhance growth here. The results were admirable, especially in certain critical spheres. One of the most compelling successes of the Maharani lay, for instance, in the development of credit facilities. This enabled thousands of families to progress from mere subsistence farming into commercial agriculture, boosting incomes, standards of living and the socio-economic prospects of their children, who were able to afford more promising futures and come into their own politically as well.

  Banking as an organised business had taken off in Travancore under a handful of prominent Syrian Christian families in the late nineteenth century. These initiatives were all registered as joint stock companies, and in 1900 there were twenty-six such ventures in the state, including non-banking concerns. Nearly twenty-five years later the figure rose to only 134 but the most extraordinary progress was yet to come. For it was after Sethu Lakshmi Bayi came to the helm that the number of joint stock companies began to multiply at an unparalleled pace, reaching a record 653 by 1931. Their paid up share capital totalled Rs 1.76 crore while working capital stood at an impressive Rs 2.7 crore.49 The vast majority of these companies (at 529) were engaged in banking and insurance services, catering to farmers and local cottage industries. While few could be credited as ‘big’ enterprises, they were, nonetheless, legitimate and strong enough to ‘withstand even the severe shocks of the Great Depression’ that would commence in 1929.50 And all of them successfully fulfilled their most important function in that innumerable farmers in Travancore, where 90 per cent of the landholdings were smaller than 5 acres and therefore prone to be commercially unviable, were able to access valuable institutional credit. The easy availability of funds at rates of interest much lower than the oppressive levies of traditional moneylenders provided a substantial impetus to agriculture.51

  Organised banks were not, however, the only sources of credit that flourished under the Maharani’s regime. The local, informal banking system known as the chitty also progressed. From 1,037 funds worth Rs 15 lakh in 1924 their numbers went up to 1,656 worth Rs 45 lakh by 1928.52 Similarly, the cooperative movement in the state received a stimulus so that from 1,002 societies in 1924 it increased by 1929 to 1,688 societies. During the same period, membership rose from 74,076 to 1,77,824 (one fifth of all the hands employed in the primary sector),53 including nearly 20,000 women. And the working capital of these societies mounted from Rs 16 lakh to the more significant figure of Rs 42 lakh.54 It is also noteworthy that the movement was not confined to higher castes alone, for by 1928 there were 222 societies dedicated especially to aiding deprived castes find their economic moorings.55

  It must be said, however, that none of this caused the traditional moneylender too much anxiety, for his influence remained largely unaffected in the short term; of the nearly 56,000 loans taken in 1928–29, over 92 per cent were furnished by the traditional sources. That is, while the total demand for credit was worth Rs 1.7 crore, the new banking system could supply only Rs 22 lakh, with the remainder being furnished by traditional channels.56 There was still, therefore, a great way for institutionalised banking to go, and to look into this the Maharani would in 1930 constitute a Banking Enquiry Committee. In pursuance of its recommendations, a Central Land Mortgage Bank was established by 1932, alongside a number of other policy initiatives, all of which facilitated a thriving banking sector in the region. This was a most significant achievement considering that even to this day, in the second decade of the twenty-first century, there are pockets in India where proper banking has not arrived. Travancore was, even in the 1920s, decades ahead of much of the subcontinent.

  The impact of the effective and steady network of credit that developed under Sethu Lakshmi Bayi on agriculture was slow but increasingly decisive, while in the future it was expected to play an even greater role. Indeed, while in the short and medium term the banks would cater mainly to the primary sector, they were planned to aid other spheres of the economy as well. Just as in Japan in the 1880s, in Travancore too the idea was that some years down the line, when the banks matured and expanded, they would diversify from agriculture and finance the processes of industrialisation. The ultimate goal, thus, was to secure the industrial future of the state, where the credit facilities set up today would act as foundations of that later stage, when the time came. It was a long-term view, one that was wise and would prove to be most visionary for generations to come.

  The Maharani was, in fact, remarkably cognizant of the long term and many of her contributions were oriented towards setting the stage for crucial future happenings. This far-sightedness previously manifested itself in her endorsement of the Cochin Harbour Scheme, which proved to be a great success. Similarly, her resolution of the Vaikom Satyagraha became a historic prelude to the even more momentous Temple Entry Proclamation a decade later. While these were some of the more significant examples of her visionary pre-eminence, there were smaller instances too where she rose to tackle specific issues, paving the future path for critical developments. One pertained, for example, to a dispute between the government and the aforementioned Kannan Devan Hills Produce Company. For twenty years before she came to power, the two sides had been locked in acrimony over water resources inside the hilly tracts leased to the latter. The company claimed unabridged rights over all the water passing through its property, including that of generating power. The government, however, was prepared to recognise rights only for ordinary purposes (irrigation, cultivation, etc.), claiming authority to charge a recurring fee for any other use. The two sides sparred bitterly until the matter reached an impasse that lasted decades, which is when Sethu Lakshmi Bayi came to power.

  The Maharani instructed the Dewan in 1925 to commence fresh negotiations with the company, and what had been a generation-long deadlock was settled to mutual satisfaction within the year. And early in 1927 Mr Watts announced that the company recognised ‘without qualification’ Travancore’s rights over the disputed water, agreeing also to
pay a royalty for every unit of power they generated from it. They also withdrew a previous claim that only they had a right to set up a power plant, with the result that the state was now in a position to build a hydroelectric station in the hills, ‘if and when the need arises’.57 In other words, the Maharani successfully cleared the path for the establishment of the state’s first power station. And indeed when the Pallivasal Hydroelectric Plant was opened in 1940, Sethu Lakshmi Bayi would look back with satisfaction at having persuasively closed that old battle with the company, something her uncle had failed to do, without which the project could never have taken off, delaying the desperately needed supply of electricity for the industrial advancement of Travancore.

  Much of her work was of a foundational nature, thus, whether it pertained to banking, ports, infrastructure, social reform and more. She could see the flow of time and did not try to obstruct it normally, even if, like the good old-fashioned conservative, she did not always appreciate the direction of that flow. And in laying the bedrock for so many progressive schemes lies the Maharani’s particular significance in history. But engineering for the future is never an easy task, and with each year, opposition from politicians and all others, who had a stake in the existing entrenched social conditions that favoured one class or caste above another, only got louder. But as the Resident noted in a report to the Government of India, Sethu Lakshmi Bayi had ‘the courage of her convictions’ and guided by her idealism and intelligence alike, did her best to firmly overcome all these obstacles.58