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Extensive legal reforms completed to propel economic stability- Sagala Ratnayaka.
Sagala Ratnayaka, Chief of Presidential Staff and Senior Advisor to the President on National Security, highlighted that policy changes during government transitions pose a significant problem in Sri Lanka. To address this issue, several structural reforms have been implemented across the government, financial, and governance sectors. He emphasized that every effort has been made to establish a stable economic system in the country. Notably, the Central Bank Act, Public Finance Act, and Public Debt Management Act have already been submitted, along with the Economic Transformation Law, which is now before Parliament for adoption.
Ratnayaka shared these insights while delivering the keynote address at the technical conference on the Port Entrance Expressway, organized by the Ministry of Transport and Highways, held at the Cinnamon Lakeside Hotel in Colombo on Wednesday (24) He noted the successful progress of the Port Entrance Expressway project and expressed confidence that its completion would significantly bolster the country’s economy.
Expressing his views further Ratnayaka stated,
“Firstly, I would like to extend my gratitude for organizing this conference, which aims to contribute to the development of our country’s future generations. This project is particularly noteworthy for its technological advancements. However, it is important to acknowledge the numerous challenges encountered during its implementation.
The construction of this project had to be carried out within a very busy port premises, which posed significant logistical issues due to limited space. Despite these constraints, a comprehensive plan was developed to ensure the project proceeded without disrupting port operations. This included relocating the port headquarters to another location. Consequently, construction commenced in 2019.
The construction company demonstrated remarkable resilience, managing to continue work amidst the challenges posed by the COVID-19 pandemic in 2020. The subsequent economic crisis, particularly the foreign exchange shortage, presented even greater obstacles. Despite these difficulties, the project is now nearing completion with minimal delays.
Our highway system, planned nearly three decades ago, is progressing despite various challenges. Many sections are currently under construction, but the crucial component—the bypass system connecting all these highways—has yet to be completed. This bypass system will facilitate the smooth flow of vehicles in and out of the city without disrupting urban activities. The port entrance expressway, supported by elevated pillars, is a key part of this system. It will notably alleviate traffic congestion between the Colombo Port and Katunayake International Airport.
Traffic congestions result in delays, which translate to financial costs. To mitigate these delays, we are relocating our logistics centers outside the city, which incurs additional time and expense. Utilizing these highways can significantly reduce both time and financial waste. However, Colombo’s development has not adequately allocated space for future expansion.
Unlike countries such as Malaysia and Singapore, where road systems were constructed with future expansion in mind, Colombo, as an older city, lacks such planning. Furthermore, inconsistent policies during the city’s development have prevented the maintenance of necessary space. Consequently, Colombo faces significant traffic congestion today.
A highway system alone cannot resolve our transportation challenges. Relying solely on roads is insufficient; we must also consider developing a high-speed rail system. The options include upgrading the existing railway, constructing an elevated rail system, or building a subway system. Although a subway system is the most effective solution, it is also the most expensive. An elevated rail system is less costly, while upgrading the existing railway is the least expensive option. Experts need to evaluate and recommend the most suitable approach for long-term sustainability.
Moreover, we must consider the commercial viability of these projects and how to finance them. Ticket sales could cover some costs, but given the current income levels of our population, it is unrealistic to expect people to afford tickets that fully cover the expenses. Transitioning to such a state will take time, so we need innovative funding methods.
In Hong Kong, for instance, the government allocated land with railway stations to investors, who developed the subway system. They constructed underground railway stations and carried out mixed-use developments such as shopping malls, office complexes, and residential projects above ground. This approach helped cover costs and kept ticket prices affordable. We need to find a similarly suitable method for our country. Efforts are already underway, but more attention is needed.
Previously, we initiated a light rail project with Japanese aid, but it was halted due to policy changes following a government transition. This highlights a significant issue in our country: policy changes with new governments lead to project disruptions. To address this, we implemented several structural reforms during the recent economic crisis, focusing on financial and governance sectors. These reforms aim to enable independent functioning, minimizing government interference and policy shifts. Key reforms include the Central Bank Act, State Finance Act, and State Debt Management Act. Additionally, the Economic Transformation Law has been submitted to Parliament, incorporating several regulatory measures.
To facilitate the business activities of foreign investors and ensure transparency, we have implemented an efficient system for quick decision-making and approvals. This new law encompasses crucial elements to steer our economy in the desired direction, contributing to the gradual development of our country.
Currently, the country has achieved a certain level of stability. During the crisis, many people faced hardship and suffering. Some criticized our agreement with the International Monetary Fund, claiming we were following their directives without question. While we had to implement some measures reluctantly, it was all for the country’s benefit. We negotiated extensively with the IMF to adapt their recommendations to our unique circumstances. The economic reform bill we have introduced goes beyond these recommendations, aiming for rapid development of a stable economy.
At the time of the country’s economic collapse, we were heavily reliant on imports, which caused prices of essential goods and services to skyrocket due to the rupee’s depreciation, while incomes remained stagnant. Our goal is to make the cost of living more affordable through rapid economic growth, for which an integrated transportation network, including a robust highway system, is vital.
Our improving relationship with India is another positive development, poised to bolster our economy. The proposed construction of a bridge between Sri Lanka and India, spanning approximately 50 kilometers across the sea, is a key component of this connectivity corridor. The technology discussed today is essential for this project, which is planned along the historic route of Adam’s Bridge. This project will provide valuable knowledge and job opportunities for our future engineers, and significantly boost our economy by enhancing port and logistics operations.
With this bridge, we aim to facilitate trade and logistics activities for South India’s imports and exports through Sri Lankan ports, reducing their supply costs by 50%. This will also open up numerous opportunities for port-related services in Sri Lanka.
In conclusion, our country has a promising future, but it is crucial to adhere to stable policies. We must unite and work together to achieve this vision.”
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Advisory for Heavy Rain issued for the Central, Uva and Sabaragamuwa provinces and in the Ampara, Batticaloa and Polonnaruwa districts
Advisory for Heavy Rain Issued by the Natural Hazards Early Warning Centre at 12.00 noon on 21 February 2026 valid for the period until 08.30 a.m. 22 February 2026
Due to the low level atmospheric disturbance in the vicinity of Sri Lanka, Heavy showers above 100 mm are likely at some places in the Central, Uva and Sabaragamuwa provinces and in the Ampara, Batticaloa and Polonnaruwa districts and fairly heavy showers above 75 mm are likely at some places elsewhere.
Therefore, the general public is advised to take adequate precautions to minimize damages caused by heavy rain, strong winds and lightning during thundershowers.
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Ravi demands full disclosure on Lanka’s usable reserves, flags forex leakages
Opposition MP Ravi Karunanayake on Wednesday called for an urgent government statement to Parliament on the integrity and usability of Sri Lanka’s Gross Official Reserves (GOR), raising concerns over foreign exchange leakages and regulatory consistency under the Foreign Exchange Act No. 12 of 2017.
Raising the issue under Standing Order 27 (i), Karunanayake urged the Government to provide a comprehensive disclosure on the composition, encumbrances and deployability of the country’s reserves, as well as on the Central Bank’s oversight of foreign currency transactions.
“Reserve credibility depends not merely on headline numbers, but on transparency, enforceability and consistency in regulation,” the MP told the House.
He sought clarification on the latest reported GOR figure and the net usable reserves after excluding encumbered assets, swaps and pledged balances. He also requested details of annual revenue earned on reserves from 2023 to 2025.
Following are the questions raised by MP Karunanayake:
1. What is the latest reported GOR figure, and what is the net usable reserve after excluding encumbered assets, swaps, and pledged balances? What is the revenue earned on are GOR 23-25 per year?
2. Provide a separate and detailed breakdown of GOR, including: (a) Monetary gold (quantity and valuation basis) is it real gold or gold paper? (b) Foreign currency assets by major currency and instrument; (c) SDR holdings; (d) IMF reserve position; (e) Foreign currency swaps, specifying counterparty type, principal amount, tenure, maturity profile, and all-in cost; (f) Domestic swaps, specifying amount, tenure, rollover terms, collateralisation, and effective cost.
3. Of the total reserves reported, how much is encumbered, swap-backed, or otherwise not immediately deployable for debt servicing or currency stabilisation?
4. What SLR spread, fee, or margin does the Central bank apply when buying or selling USD to the Government for reserve accumulation and external debt servicing and what total profit or gain has the C.bank realised from such transactions during the past three financial years? Advice per year.
5. Is the Central Bank subject to continuous and statutory audit by the Auditor General? If so, will the Government table the most recent audit report, specifying audit scope, sample size, reserve confirmations, swap verification and gold custody validation?
6. What triggered the recent circular warning domestic institutions on foreign currency transactions?
7. Has the C.bank quantified foreign exchange and tax revenue losses resulting from Sri Lanka-based businesses routing credit card and commercial payments through overseas payment gateways?
8. If domestic entities are regulated strictly, why has a binding circular not been issued against noncompliant business entities using foreign payment gateway arrangements that divert foreign exchange outside Sri Lanka’s regulated banking system?
The government asked for two weeks’ time to respond to the queries.
by Saman Indrajith
News
Sajith exposes highly questionable coal imports from South Africa in 25 vessels; calls for independent probe
Opposition Leader Sajith Premadasa yesterday alleged in Parliament that eight recently imported coal shipments were substandard and called for an independent probe into the matter.Speaking in the House, Premadasa said Sri Lanka typically requires 36–38 coal shipments annually. While 11 Russian shipments received so far had raised no concerns, he claimed that 25 vessels ordered from South Africa under a new tender were facing quality issues.
He cited combustion reports from the Norochcholai Coal Power Plant showing that the eight shipments already received under the new tender failed to generate the expected 300 megawatts per unit. According to the MP, the outputs were: 285 MW, 290 MW, 260 MW, 295 MW, 285 MW, 270 MW, 275 MW, and 255 MW.
“These are scientific data generated automatically through boiler combustion reports that cannot be altered,” Premadasa said, asserting that the figures indicate the coal supplied was below required standards.
He warned that low-quality coal could increase fuel consumption, raise operational costs, and damage equipment. Any shortfall in power generation, he said, would necessitate additional coal imports or greater reliance on diesel power, ultimately driving up electricity tariffs for consumers.
“The loss will have to be borne by the electricity consumer,” Premadasa said, urging the government to clarify whether the shipments met required specifications.
He also criticized delays and changes in tender requirements, alleging that supplier eligibility criteria had been relaxed to allow non-standard providers.
by Saman Indrajith
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