history/The Dutch Period in Ceylon 1602–1796
After the Portuguese surrender in 1658, the Dutch East India Company found itself master of two coastal provinces of Ceylon: the region around Galle and Colombo in the south and the northern region around Jaffna, where the entire Kingdom of Jaffnapatnam, including Mannar had acknowledged its authority. The population in the southern part of the Dutch territories was estimated at some 350,000 and in Jaffna at 120,000. However, the Company had exceeded to an estate which was badly neglected.
At the second half of the 17th Century the Dutch Governors took energetic steps to revive the economy and to win the hearts and minds of their new subjects. In the south many rice fields were lying abandoned, their dams and waterways destroyed. The Governors engaged many thousand of Tamils from Southern India to reclaim the rice fields, introduced silk-worms from Bengal and encouraged cotton growing as dams, waterways and wells in the north were repaired. By 1665 the Company’s activities in Ceylon became prosperous. Major Jan van der Laan organised in 1666 the first pearl fishery with 400 boats, attracting large crowds willing to take part of the endeavour. While prosperity grew in the Dutch controlled areas, the Kandyan Kingdom remained a purely agrarian society.
For the VOC cinnamon was the most important commodity. To procure it the Company had to placate the King since the best cinnamon grew wild in the Kandyan territories. However, the prosperity of the VOC and the unwillingness to transfer the main forts to the King had not done much good to relations. The company had also imposed strict controls on imports and exports and closed the ports to the King in order to safeguard its monopoly under the Treaty of 1638 vis-à-vis the Arab traders and foreign, mainly English and French competitors. The King therefore made life for the Dutch as miserable as possible which finally led tot the reopening of some ports. The collection of cinnamon however was seriously affected and the pearl fishery ceased for eight years.
After a period of hostilities, both parties realised that they had to reach a compromise. The Dutch Governor Thomas van Rhee and King Vimala Dharma Surya II, who had succeeded his father in 1687, agreed to Dutch cinnamon peeling activities in his territories in return for a yearly subsidy. The parties could not agree on the status of the occupied territories. The Dutch considered the treaty obligations of 1638 with respect to the transfer of the forts no longer binding because the King had not paid the Dutch bill for the war costs. The King and his Ministers rejected any Dutch claim against the King’s treasury. This unsolved problem would continue to burden the relations until 1766, when a new Treaty between the Kandyan Kingdom and the Dutch was concluded.