Structurally the economy of Sri Lanka, when it became independent in 1948, hardly differed from that of the early part of the century. It has been described as ‘an undiversified agricultural export economy’ (Das Gupta, 1949) with the plantations as the principal source of economic activity. Agriculture, both plantation and peasant subsistence in the rural areas, constituted the core of the economy, contributing more than 50 per cent of the Gross National Product.