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Need for multipronged reform programme stressed

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(From L) Sathya Karunarathne, Sanjaya Mohottala, MP Mayantha Dissanayake and Prof. Sirimal Abeyratne at the discussion

Pre-budget discussion

The need for multi-pronged broad reforms to stabilise the economy and to ensure long-term policy consistency were some of the key highlights at a pre-budget discussion held on Oct 21, addressing a number of economic issues currently faced by Sri Lanka.

The discussion, titled ‘Budget 2022: Sri Lanka’s Path to Economic Stability,’ was organised by NextGenSL and the Friedrich Naumann Foundation for Freedom in Sri Lanka. Justus Lenz, Policy Advisor for Economic and Financial Affairs at the Liberal Institute, the Friedrich Naumann Foundation for Freedom’s think tank, delivered the keynote speech, in which he shared Germany’s experience in economic revival with the hope of encouraging Sri Lanka to embark on broad and meaningful reforms to revive the economy, said a joint press release issued by NextGenSL and the Friedrich Naumann Foundation.

It said: Lenz drew attention to the fact that Germany’s success was based on four primary factors — 1) Free markets, property rights, and unregulated prices 2) The rule of law, infrastructure, and social policies provided by the state 3) Abstention from direct market interventions (mostly) and 4) Free trade and the EU’s common market.

“Actual economic growth depends entirely on entrepreneurs who develop products and services. But in order to drive development and progress, entrepreneurs need a well-functioning market order which provides freedom and security,” he told the audience. “Facing enormous difficulties, West Germany implemented the Social Market Economy and placed its trust in free markets, the entrepreneurial spirit, and an open society. East Germany bet on central planning and top-down control. In the first 10 or 20 years, the race to prosperity seemed to be a close one. But the long-term effects of both free and controlled markets soon became obvious,” he said.

“A lesson that can be drawn from looking at our experience in Germany is that reforms towards a free-market order can be very successful. If one pursues this direction, it is important to consider that success can take time. The implementation time can be painful and long, as seen both after 1948 and 1989”, adding, “Of course, there is no easy recipe for implementing a free-market order such as the Social Market Economy,” he added.

Following the keynote speech, a panel discussion featuring Prof. Sirimal Abeyratne, MP Mayantha Dissanayake, Sanjaya Mohottala, Chairman, Board of Investments, and Justus Lenz took place, primarily focusing on Sri Lanka’s need for broad economic reforms. Sathya Karunarathne of the Advocata Institute moderated the discussion.

Expressing his views at the panel discussion, Prof. Sirimal Abeyratne, a veteran economist, said that Sri Lana should move away from ad-hoc changes and work towards an overall reform package. “Even measures such as the removal of price controls should have come as part of an overall reform package. Without such an approach, there is going to be an enormous impact on low-income groups,” he said, adding that Sri Lanka should not look for short-term solutions for long-term problems.

“Budget is a short-term policy plan which only focuses on a period of 12 months. But it has to be consistent with a long-term plan. The absence of such consistency has been the problem in Sri Lanka,” he explained, adding that it was important to understand that a budget could not grant relief without someone paying for it.

“We had the space to print money during the early stages of the pandemic. Now, the vaccination process has seen significant progress and Sri Lanka has done a commendable job with the vaccination drive when compared to many other developing nations. As a result, inflation and aggregate demand are increasing, limiting the Central Bank’s ability to finance the budget deficit,” he pointed out.  Prof. Abeyratne was also of the opinion that the current import controls were an “easy way-out” for Sri Lankan lawmakers.

“We must first understand what hinders the growth of domestic production. There are many factors contributing to this situation, but we brush them aside and resort to import controls because that is the easy way out. As a result, the core issues will remain the same,” he explained.

Parliamentarian Mayantha Dissanayake stressed the fact that both the Government and the opposition must work together with a common agenda to revive the economy and to reach a consensus on long-term policy reforms. “There is an urgent need to restore the trust of investors in the country. For this, a clear and cohesive message should be sent out,” Dissanayake said, adding, “We must find ways to restructure the management of these loss-making SOEs. They have become a severe burden on the economy. I would like to suggest a Temasek-like model for the divestment of government stake in these SOEs.  Sri Lanka must strike a fine balance between the aspects of a welfare state and the much-needed economic reforms.”

He was also of the strong view that all reforms must be done in strict adherence to democratic practices, aiming to improve the efficiency and effectiveness of these SOEs. “I am a firm believer of monitoring and evaluation processes. This is why I believe getting rid of the National Audit Commission is an undesirable move by the current administration. Sectoral Oversight Committees, another important tool to ensure accountability, should have been allowed to continue,” the MP said.

He said another pressing problem confronting Sri Lanka at the moment is brain-drain. Even during the time of war, when a number of political leaders were assassinated, we did not see a brain drain of this magnitude,” he said. “This is a serious problem the government must address through meaningful reforms.”

BOI Chairman Sanjaya Mohottala said Sri Lanka’s focus at the moment was to create a compelling environment for FDIs through consistent immediate and long-term reforms. “What we need from the budget the most is stability,” Mohottala said. “This includes better clarity, better transparency, and better consistency.” He added that the country must set the foundation to double the GDP in 10 years with the minimum inconsistencies while addressing a host of other areas and assured the audience that the current administration was working on a number of measures to address the issues faced by investments including ‘simplifying’ the system.

“We must now get out of the pandemic mindset and look for opportunities. We are currently working towards building the capacity in the legal sector to remove some of the impediments. Digitalization of the legal process is a must. Also, we are working to build infrastructure allowing the justice system to address all regulatory-related issues expeditiously,” he said, proposing a pragmatic policy on taxation that would create a better climate for the youth to work in Sri Lanka.

In his remarks at the panel discussion, Justus Lenz said every country must find its own way to address its own. “But we must not forget that good policies are not expensive. Long-term commitment to stability and free-market reforms are not expensive,” he stressed. The German expert also pointed out that it was critically important to remain optimistic and create a long-term consensus on reforms without losing clarity.


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US embassy won’t comment on IGP’s probe into joint drug raid

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5 hours ago

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2026/09/17

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Drugs taken into custody (pic courtesy US Embassy)

… America-Pakistan developed required ‘intel’ for operation

By Shamindra Ferdinando

The US Embassy in Colombo declined to comment on a special police probe into the recent narcotics detection, jointly made at the China-managed Colombo International Container Terminal (CICT) by the US Drug Enforcement Administration’s (DEA) New Delhi Country Office and Sri Lanka Police..

US Embassy spokesperson said that the mission wouldn’t add to their press release, issued on 2 Sept., in the immediate aftermath of the raid.

Police Headquarters, on 11 Sept., declared that the Central Crime Investigation Bureau (CCIB) was conducting investigations into the recovery of 473 kg of Crystal Methamphetamine (‘Ice’). Police never acknowledged the role played by the US in the operation.

According to Police Headquarters, on a directive given by IGP Priyantha Weerasooriya, the Special Investigation Unit has launched an internal probe into, what it called, shortcomings and irregularities in the Colombo Port raid.

The Island:

Have you (relevant US authorities) received an update of Sri Lanka’s investigations from the Police?

US Embassy:

U.S. and Sri Lankan law enforcement authorities maintain close and ongoing cooperation on counternarcotics matters, including the exchange of information that helps both countries combat transnational drug trafficking. We don’t have anything further to share on communications with Sri Lankan authorities beyond what we’ve already said publicly about the successful operation.

The Island:

Did the Police seek clarification regarding DEA, New Delhi Country Office role in the successful raid?

US Embassy:

As the Embassy noted publicly following the seizure, cooperation with the U.S. Drug Enforcement Administration contributed to the Sri Lanka Police Narcotics Bureau’s successful seizure of approximately 463 kilograms of methamphetamine at the Port of Colombo.

The seizure demonstrates the value of close U.S.-Sri Lankan cooperation in disrupting transnational narcotics trafficking.

The Island:

Before we raised this issue were you aware of the internal investigation into the drug bust which was also raised in Parliament last week?

The US Embassy:

We don’t have anything further to share beyond what we’ve already said publicly about the successful operation.

Our focus remains on the strong U.S.-Sri Lanka law enforcement partnership and the concrete results our cooperation can deliver—disrupting transnational criminal organisations, cutting off the profits that fuel illicit drug trafficking, and protecting our citizens from the dangers of narcotrafficking.

The US Embassy attributed the success of the counternarcotics operation to the US-Sri Lanka partnership

The US Embassy statement, dated 2 Sept: The U.S. Drug Enforcement Administration’s (DEA) New Delhi Country Office and Sri Lanka’s Police Narcotics Bureau (PNB) conducted a successful joint operation disrupting a Pakistan-based narcotrafficking network attempting to smuggle crystal methamphetamine through Sri Lanka to international markets.

Acting on intelligence developed by DEA’s Foreign Counterparts Unit Pakistan Anti-Narcotics Force Special Investigations Cell between August 14–29 on suspicious maritime containers moving from Pakistan to Colombo, PNB seized approximately 463 kg of crystal methamphetamine with a street value of $21 million, concealed in bath towels, and arrested several suspects, including Pakistani nationals. This operation underscores the strength of the U.S.-Sri Lanka partnership in dismantling transnational criminal organisations that fund terrorism and threaten communities in both our countries. This cooperation builds on long-standing training and technical assistance provided through the U.S. Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL) to the Sri Lanka Police and Customs. The United States remains committed to working with Sri Lanka and regional partners to aggressively pursue transnational criminal organizations, deny them the revenue from illicit drug trafficking, and protect our citizens from the dangers of narcotrafficking.”

SLPP National Organiser Namal Rajapaksa, in Parliament, raised questions about the internal investigation into the raid. However, Rajapaksa, too, hasn’t mentioned the US role in the operation. The Special Investigation Unit has recorded a statement from Senior DIG Ranmal Kodituwakku regarding the Colombo Port raid.

MP Rajapaksa questioned the rationale behind questioning the officer who led the raid against the backdrop of controversial releasing of 323 containers from the Colombo Port in January 2025. The failure to question those responsible for the releasing of 323 containers indicated who was behind that operation, MP Rajapaksa told Parliament.

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Gnanasara Thera declares outside High Court that he wouldn’t flee

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2026/09/17

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Gnanasara Thera

Bodu Bala Sena (BBS) General Secretary Ven. Galagodaaththe Gnanasara Thera appeared before the Colombo High Court yesterday in a case filed by the Attorney General over statements allegedly insulting Islam.

The case was taken up before Colombo High Court Judge Buddhika C. Ragala, who ordered that it be called again on September 30.

His appearance came six days after the Supreme Court invalidated the presidential pardon granted to Gnanasara Thera by former President Maithripala Sirisena in 2019.

Speaking to journalists outside the court, Gnanasara Thera said he was prepared to face the legal process and would abide by the law, rejecting reports that he had gone into hiding following the Supreme Court judgment.

“It is the weak who disappear and flee. We worked for the country and are facing the consequences for that. We are not afraid and will not flee,” he said, noting that he would surrender to the court and face whatever legal consequences following the Supreme Court decision.

The Supreme Court, on September 10, ruled that the presidential pardon granted to Gnanasara Thera by Sirisena was invalid. The judgment followed fundamental rights petitions challenging the legality of the pardon. A three-judge bench, comprising Justices Janak de Silva, Sobhitha Rajakaruna and Sampath Abeykoon, delivered the ruling.

Gnanasara Thera was convicted by the Court of Appeal in 2018 for contempt of court and sentenced to a total of 19 years’ imprisonment to run concurrently as six years. The conviction related to his conduct during proceedings at the Homagama Magistrate’s Court concerning the disappearance of Prageeth Eknaligoda.

He was released from Welikada Prison on May 23, 2019, after then President Maithripala Sirisena had granted him a presidential pardon.

The Supreme Court found the pardon to be arbitrary and invalid in law, following its consideration of the petitions challenging the exercise of the presidential power of clemency.

Meanwhile, police have said they are awaiting the Supreme Court judgment before determining what further action should be taken following the invalidation of the pardon.

The proceedings before the Colombo High Court yesterday are separate from the contempt of court case that resulted in the six-year sentence. They concern alleged statements made by Gnanasara Thera regarding Islam.

In June this year, the Colombo High Court rejected an appeal by Gnanasara Thera against a nine-month prison sentence imposed by the Colombo Magistrate’s Court in connection with statements made at a 2016 media briefing that were found to have disrupted religious coexistence.

The latest High Court proceedings, therefore, form part of separate legal action concerning his alleged remarks about Islam, while the Supreme Court ruling relates specifically to the legality of the 2019 presidential pardon granted in connection with his contempt of court conviction.

The case before the Colombo High Court will be called again on September 30.

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Namal further remanded

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5 hours ago

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2026/09/17

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MP Namal Rajapaksa being taken out from the Colombo Fort Magistrate’s court yesterday

Colombo Fort Magistrate Pasan Amarasena yesterday (16) ordered SLPP National Organiser Namal Rajapaksa, MP, to be further remanded, until September 23. The Magistrate issued the order when Rajapaksa was produced before the court as a suspect in an investigation into an alleged USD 2 million bribe case connected to the acquisition of aircraft for SriLankan Airlines.

The Magistrate issued the order following the submissions made by Deputy Solicitor General Janaka Bandara, appearing on behalf of the Criminal Investigation Department (CID).

President’s Counsel Anil Silva, along with other attorneys representing Rajapaksa, also made submissions before the court.

The Magistrate also announced that a decision on Rajapaksa’s bail application would be announced on 23 September.

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