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Brown sugar to be exported

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In a bid to rescue Sri Lanka’s struggling sugar industry, the government is exploring plans to rebrand locally produced brown sugar as “organic sugar” and market it to international buyers, including China, Iran, and several African nations.

Industries Minister Sunil Handunnetti revealed the strategy in Parliament yesterday, responding to opposition concerns over the dire state of the sugar industry. He said that Sri Lankan brown sugar, though produced using fertilisers with minimal arsenic content, qualifies for organic labeling under international standards.

“This is a long-term solution we are working on. Discussions are underway with China, Iran, and some African countries to begin exports,” Handunnetti said.

The announcement came during a heated exchange with Opposition and SJB Leader Sajith Premadasa, who warned that the collapse of the sugar sector could devastate more than 250,000 families in the Uva Wellassa region. He criticised the current tax structure, which burdens local sugar producers with 18% VAT and additional levies, pushing production costs to Rs. 238 per kilo—while the market price remains at Rs. 175, resulting in steep financial losses.

Premadasa highlighted significant losses at major state-affiliated sugar factories, citing Rs. 17 billion at Gal Oya, Rs. 10 billion at Pelwatte, Rs. 7 billion at Etimale, and noting that Sevanagala is in urgent need of repairs.

He also highlighted ethanol production as another loss-making area. While one litre of ethanol costs between Rs. 628 and Rs. 759 to produce, it is sold at just Rs. 450–475. “The minimum viable price should be Rs. 800 per litre,” he said, adding that although he doesn’t promote ethanol, it remains an essential byproduct of sugar production. The government, he noted, takes 45% of profits from ethanol sales and imposes a Rs. 10,000 tax on each metric tonne of molasses.

Responding to Premadasa’s accusations, Minister Handunnetti refuted claims that sugar is available in the market at Rs. 175 per kilo. He pointed out that under the previous administration, brown sugar prices had soared to Rs. 360 per kilo, while white sugar hit Rs. 220. “Today, brown sugar has dropped to Rs. 260 per kilo, while white sugar prices have remained stable,” he claimed.

Handunnetti detailed the structure of the industry, clarifying that only the Sevanagala and Pelwatte factories are under the state-run Sugar Corporation. Etimale is privately owned, and Gal Oya operates under a public-private partnership, with the government holding a 51% stake.

He presented five-year production data for the two state-run factories, showing outputs of 39,687 metric tonnes in 2020, 48,177 in 2021, 36,637 in 2022, 41,861 in 2023, and 39,721 in 2024.

Despite this, local sugar production met only 6.03% of the national requirement of 658,678 metric tonnes in 2024. The remainder was met through imports—564 million kilos in 2024, and 140 million kilos so far in 2025.

Handunnetti noted that imported sugar is taxed under a special commodity levy of Rs. 50 per kilo. Meanwhile, domestically produced sugar faces an 18% VAT introduced in January 2024 and a 2.5% social security tax—bringing the total tax burden on local sugar to 20.5%



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Tobacco and alcohol claim 22,000 lives annually

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Health and Mass Media Secretary Dr Anil Jasinghe speaking to NPP MP Samanmali Gunasinghe during the sectoral oversight committee meeting

NATA to be given more powers

The Parliamentary Sectoral Oversight Committee on Health, Mass Media and Women’s Empowerment has agreed in principle to ban single-stick sales of cigarettes and increase taxes on tobacco products, according to parliamentary sources.

The decision was reached during an institutional review of the National Authority on Tobacco and Alcohol (NATA) held recently in Parliament. The meeting was chaired by MP Dr. Nihal Abeysinghe.

During the review, NATA officials informed the committee that approximately 22,000 deaths occurred annually in Sri Lanka due to tobacco and alcohol consumption. They said the country suffered an economic loss of between Rs. 225 billion and Rs. 240 billion each year due to the consumption of tobacco products and alcohol.

Officials told the committee that steps were underway to amend the National Authority on Tobacco and Alcohol Act to grant it more powers.

Noting that 104 countries had already banned the sale of loose cigarettes, the underscored the need for Sri Lanka to adopt a similar policy. When loose cigarettes were sold, mandatory health warnings on cigarette packets were not visible to consumers, the NATA officials said.

The committee was also briefed on the importance of imposing taxes on cigarettes after determining their retail prices, as part of broader measures aimed at reducing tobacco consumption.

Commenting on the matter, Dr. Abeysinghe said the committee was prepared to extend its full support for the proposed amendments to the Act, as well as for other programmes and initiatives undertaken by the National Authority on Tobacco and Alcohol.

Deputy Chair of the Committees Hemali Weerasekara, committee members MPs Dayasiri Jayasekara, Muneer Mulaffer, Samanmali Gunasinghe, Prof Sena Nanayakkara, Dr S. Sri Bhavanandarajah, Dr Ramanathan Archchuna and with the permission of the Chair, MPs Dr. Janaka Senarathna and Dr Pathmanathan Sathiyalingam were present at the committee meeting.

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Development Officers hunger strike drags on for fourth day

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Development officers on hunger strike demanding absorption into the teacher service, outside the Presidential Secretariat at Colombo.

The hunger strike launched by a group of Development Officers demanding their absorption into the teacher service entered its fourth day yesterday (29) outside the Presidential Secretariat Colombo.The protesters, members of the Ceylon School Development Officers’ Union (CSDOU), began their satyagraha on January 26.

One of the four officers participating in the fast-unto-death fell seriously ill on the fourth day and was rushed to hospital for treatment, while the remaining three continued the hunger strike. Earlier, Dr. Chamal Sanjeewa, President of the Doctors’ Trade Union Alliance for Medical and Civil Rights, visited the protest site to examine the health of the protesters and oversaw the administration of saline to those suffering from dehydration.

CSDOU Secretary Viraj Manaranga criticised authorities for refusing to listen to the protestors.

“Not a single official from the relevant authorities has come forward to hear our grievances, which is a matter of serious concern,” he said, accusing the government of negligence and “stepmotherly treatment” of the issue.

The Ceylon Teachers’ Union (CTU) echoed the need for legal and procedural adherence, noting that there are currently 40,000 teacher vacancies nationwide. The union stressed that a significant number of development officers and graduates remain outside the teaching service, despite provisions in the teacher service constitution allowing for their appointments, which fall under the powers of Provincial Councils.

National People’s Power (NPP) MP Chandana Sooriyarachchi said graduate development officers are required to sit a compulsory competitive examination. Former Education Minister Akila Viraj Kariyawasam, who oversaw appointments under the Good Governance administration, also stated that direct appointments are legally not feasible. He added that school development officers were absorbed into the teacher service in 2018 through competitive exams and stressed that appointments must follow established procedures, warning that strikes would not alter this process.

The hunger strike continues to draw attention to the demands of the Development Officers as they urge the government to take immediate steps to address their grievances.

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IMF urges Lanka to diversify trade amidst global tariff risks

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Srinivasan

Sri Lanka and other small Asian economies must accelerate trade diversification or face heightened vulnerability to global tariff disputes and shifting supply chains, warned Krishna Srinivasan, Director of the Asia and Pacific Department at the International Monetary Fund (IMF).

Speaking in Colombo on the evolving global trade landscape, Srinivasan highlighted Asia’s growing exposure, particularly in the wake of tariff tensions between the United States and China. “Asia benefited a lot from trade integration, benefited a lot from openness to trade,” he said. “So much so that when tariffs were imposed by the US, Asia was subject to the highest level of tariffs.”

He cautioned that the region that gained most from open markets is now at risk of bearing the brunt of protectionist measures. For countries like Sri Lanka, he said, the message is clear: diversify or be exposed.

Srinivasan also noted that South Asia remains the least integrated sub-region in the continent. “Having greater integration with your partners within the sub-region will take you a long way,” he said. For small economies, he added, building deeper trade ties with neighbours and broadening export and production bases is essential for resilience.

Meanwhile, Sri Lanka has received a strong vote of confidence from the IMF following a high-level meeting between President Anura Kumara Dissanayake and the delegation at the Presidential Secretariat.

The visiting IMF representatives, who arrived on January 22 to assess the damage caused by Cyclone Ditwah, spent a week touring the island, engaging with affected communities and observing the impact firsthand. In a briefing, the delegation praised the government’s swift relief efforts, infrastructure restoration, and commitment to rebuilding lives, noting widespread appreciation among citizens for the administration’s handling of the crisis.

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