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Sri Lanka heading for serious crisis!

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By Dr. Laksiri Fernando

This is not a prediction, but the reality. Sri Lanka is already in a serious crisis in terms of people’s living conditions, the economy, foreign reserves, political system, government’s legitimacy, public administration, foreign relations and the government’s day to day decision making processes. While some are long standing, like the foreign reserves or debt, most of the others are quite recent, and are the results of unequivocal incompetence and bad management. Even the foreign debt situation has worsened under the present administration.

If one draws a balance sheet, the current administration can be credited for COVID-19 vaccinations, but almost all other endeavours are utter failures. At the presidential elections in November 2019, 6.9 million people voted with much hope, but all these are now shattered. The slogan touted was ‘Prosperity and Splendour.’ Prosperity has been acquired by the deal makers and fraudsters; no splendour to the country or the people. In economic policy, the government has zigzagged between ‘state-control’ and ‘free-market,’ and the economy and the people have suffered as a result.

Economy and inflation

What affects the people in general and their living conditions at present is the thumping inflation in essential commodities. Even according to the Central Bank, the national inflation rate has gone up from 3.7 percent in January 2021 to 7.6 percent in October 2021. As the Trading Economics website has noted, “Prices advanced at a faster pace for both food products (12.8 percent vs 10 percent in September) and non-food products (5.4 percent vs 3.8 percent).” Taking into account the piling up of hardships on people, Moody’s has downgraded Sri Lanka’s sovereign rating from Caa1 to Caa2. Corruption might be another reason for this downgrading.

People’s living difficulties cannot be fully gauged through official inflation rates. The newspapers and TV interviews with people on the ground have revealed more drastic conditions. Day by day the prices of essentials like rice, tea, milk powder, sugar, bread, coconut, lentils and vegetables have been going up. Men express their anger and women cry referring to their children’s and household needs. One reason for the price inflation is the rapid increase of fuel prices. Undoubtedly, world prices are going up, but in Sri Lanka, the gap between the fuel refinery costs and market prices is also high.

Of course, many countries have suffered economically during the COVID-19 pandemic. But to alleviate people’s suffering during the lockdowns and after, most countries (if democratic!) have taken measures to offer various payments and relief measures. It is understandable that Sri Lanka has serious public finance difficulties. However, most of these difficulties are the result of waste, corruption, and financial mismanagement. The stagnation of salaries in both public and private sectors has also contributed considerably to the people’s difficulties.

Zig-zag policies

There have been these zigzag policies and u-turns, particularly between August and October this year. First the government imposed a state of emergency with regard to essential food items, including rice and sugar, with controlled prices and started to raid hoarders. It created a huge black market and the prices shot up. The government did not have any control. It withdrew all the gazette notifications on controlled food prices, and the prices again went up!

Even before, since March 2020, import controls were imposed due to foreign currency shortages. Since then, and until last month the government went in the direction of a ‘closed economy’. After one year’s ‘experimentation,’ in April this year, Basil Rajapaksa was sworn in as the Minister of Finance to implement a change. It is that change we are experiencing at present!

Now, it appears that we are in an ‘open economy,’ more open than before to corruption and ‘money making’ by politicians, their families and cohorts. This is part of the controversy over the discreet deal between the government and the American New Fortress company.

The old dichotomous controversy over a ‘closed-economy’ and an ‘open-economy’ does not have much meaning today. While an economy should be open as much as possible in market sense and also in investments, the State has a definitive role in maintaining strategic enterprises like harbours, airports and the energy sector. In addition, the state also should offer welfare services to the needy and encourage people to work hard to contribute to the country’s welfare. To motivate people towards work and entrepreneurship, politicians should be exemplary, and free from corruption and misdeeds.

Fertilizer crisis

It was in April this year that the President suddenly declared a complete ban on chemical fertilizer importation. It was like a military order. That was the flaw. There is no question that high quality organic fertilizer is better for the environment and people’s health. However, that transition requires much time, planning, raising of awareness among farmers, and necessary arrangements to be made to produce (or import) reliable organic fertilizer.

The immediate effect was on the tea industry and vegetable cultivation. Then came the Maha paddy cultivation season in September. Without fertilizer, chemical or organic, farmers could not continue cultivation. Except in certain areas, the situation is the same today. Although the agriculture contribution to GDP is (under)estimated at eight percent, over 28 percent of the population depend on agriculture and 82 percent of the population live in rural areas.

In the President’s speech in April, he said, “the annual sum of USD 400 million spent on fertilizer imports could be used to uplift the lives of the people.” Now, what has happened? Perhaps realizing the lack of capacity to produce organic fertilizer locally, at such short notice, the government then decided to import 99,000 tonnes of ‘organic’ fertilizer (solid and liquid) from China. Perhaps there were other reasons.

This fertilizer has proved or is alleged to be more harmful than the chemical fertilizer! The government also decided to import 30,000 tonnes of potassium chloride from Lithuania, but called it ‘organic fertilizer.’ Sri Lanka also had to so far import 3.1 million litres of nano liquid fertilizer from India. Some politicians may have taken commissions from all these new foreign contracts.

Within the last three months, fertilizer costs have rocketed to nearly USD 150 million, and if calculated with previous imports (January to July), definitely exceed the previous annual cost of fertilizer imports ($ 400m) that the President quoted in April. If these figures are incorrect, it is up to the government to reveal the correct figures to the people.

Elevation of Gnanasara?

The government’s mistakes, blunders or offences are not limited to the mismanagement of the economy, cost of living, or the ‘commission seeking’ deals by ministers and appointed officials. The social and public policies are equally disastrous. A recent case in point is the appointment of (Ven.) Galagoda Aththe Gnanasara as the Chairman of the so-called Presidential Task Force on ‘One Country, One Law.’

‘One country, one law’ is not the correct formulation, if it refers to granting, the civil code or personal laws in the country, some uniformity or conformity. ‘Uniform civil code’ or ‘common civil code’ might be better formulations. ‘One country, one law’ should refer strictly to offering the validity and application of laws equally to the ‘powerful and powerless’; the ‘politicians and ordinary citizens’; and the ‘rich and poor’. This is the way the majority of the people must have understood the slogan at the last election.

Gnanasara undoubtedly is not suitable to perform either of the tasks. He is appallingly partial and aggressive. He is the leader of the Bodu Bala Sena (Buddhist Power Army) with proven discordant behaviour. He has been involved in many violent acts and was imprisoned for six months for threatening a woman in the courts. What kind of law reforms can one expect from this type of person? In addition to this dubious Chairman, this so-called 13-member task force does not include a single woman, Tamil or a Christian.

Conclusion

One wonders whether the purpose of the above moves, on the part of the government, is to instigate and fuel religious and ethnic tensions in the country. This is in order to possibly tighten a stronger military or authoritarian grip on the political system as the economic and political policies of the government have been utter failures.

However, in Sri Lanka, the democratic traditions of the country, people’s awareness, trade union movement, independent media and civil society organizations are stronger than the spoiled and corrupt political leaders. Let us keep our fingers crossed.



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Sri Lanka’s new govt.: Early promise, growing concerns

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President Anura Kumara Dissanayake’s demeanour, body language, and speaking style appear to have changed noticeably in recent weeks, a visible sign of embarrassment. The most likely reason is a stark contradiction between what he once publicly criticised and analysed so forcefully, and what his government is actually doing today. His own recent speeches seem to reflect that contradiction, sometimes coming across as confused and inconsistent. This is becoming widely known, not just through social media, YouTube, and television discussions, but also through speeches on the floor of Parliament itself.

Doing exactly what the previous government did

What is now becoming clear is that instead of doing things the way the President promised, his government is simply carrying on with what the previous administration, particularly Ranil Wickremesinghe’s government, was already doing. Critically, some of the most senior positions in the state, positions that demand the most experienced and capable officers, are being filled by people who are loyal to the JVP/NPP party but lack the relevant qualifications and track record.

Such politically motivated appointments have already taken place across various government ministries, some state corporations, the Central Bank, the Treasury, and at multiple levels of the public service. There have also been forced resignations, bans on resignations, and transfers of officials.

What makes this particularly serious is that President Dissanayake has had to come to Parliament repeatedly to defend and “clean up” the reputations of officials he himself appointed. This looks, at times, like a painful and almost theatrical exercise.

The coal procurement scandal, and a laughable inquiry

The controversy around the country’s coal power supply has now clearly exposed a massive disaster: shady tenders, damage to the Norochcholai power plant, rising electricity bills due to increased diesel use to compensate, a shortage of diesel, higher diesel prices, and serious environmental damage. This is a wide and well-documented catastrophe.

Yet, when a commission was appointed to investigate, the government announced it would look into events going back to 2009, which many have called an absurd joke, clearly designed to deflect blame rather than find answers.

The Treasury scandal, 10 suspicious transactions

At the Treasury, what was initially presented as a single transaction, is alleged to involve 10 transactions, and it is plainly a case of fraud. A genuine mistake might happen once or twice. As one commentator said sarcastically, “If a mistake can happen 10 times, it must be a very talented hand.” These explanations are being treated as pure comedy.

Attempts to justify all of this have sometimes turned threatening. A speech made on May 1st by Tilvin Silva is a case in point, crude and menacing in tone.

Is the government losing its grip?

Former Minister Patali Champika has said the government is now suffering from a phobia of loss of power, meaning it is struggling to govern effectively. Other commentators have noted that the NPP/JVP may have taken on a burden too heavy to carry. Political cartoons have depicted the NPP’s crown loaded with coal, financial irregularities, and political appointments, bending under the weight.

The problem with appointing loyalists over qualified professionals

Appointing own supporters to senior positions is not itself unusual in politics. But it becomes a betrayal of public trust when those appointed lack the basic qualifications or relevant experience for the roles they are given.

A clear example is the appointment of the Treasury Secretary, someone who was visible at virtually every NPP election campaign event, but whose qualifications and exposure/experiences may not match the demands of such a critical position. Even if someone has a doctorate or professorship, the key question is whether those qualifications are relevant to the role, and whether that person has the experience/exposure to lead a team of seasoned professionals.

By contrast, even someone without formal academic credentials can succeed if they have the right skills and surround themselves with advisors with relevant exposure. The real failure is when loyalty to a political party overrides all other considerations, that is a fundamental betrayal of responsibility.

The problem is not unique to this government. In 2015, the appointment of Arjuna Mahendran as Central Bank Governor was a similar blunder. His tenure ended in scandal involving insider dealing and bond market manipulation. However, in that case, the funds involved were frozen and later confiscated by the following government, however legally questionable that process was.

The current Treasury losses, by contrast, may be unrecoverable. Critics say getting that money back would be next to impossible.

The broader damage: Demoralisation of capable officials

When loyalists are placed above competent career officials in key positions, it demoralises the best public servants. Some begin to comply in fear; others lose motivation entirely. The professional hierarchy breaks down. Junior officials start looking over their shoulders instead of doing their jobs. This collective dysfunction is ultimately what destroys governments.

Sri Lanka’s pattern: every government falls

This pattern is deeply familiar in Sri Lankan history. The SWRD Bandaranaike government, which swept to power in 1956 on a wave of popular support, had declined badly by 1959. The coalition government, which came to power reducing the opposition to eight seats, lost in 1977, and, in turn, the UNP, which came in on a landslide, in 1977, crushing the SLFP to just eight seats, suffered a similar fate by 1994.

Mahinda Rajapaksa came to power in 2005 by the narrowest of margins, in part because the LTTE manipulated the Northern vote against Ranil Wickremesinghe. But he was re-elected in 2010 on the strength of ending the war against the LTTE. Still, by 2015, he was voted out, because the benefits of winning the war were never truly delivered to ordinary people, and because large-scale corruption had taken root in the meantime. Gotabaya Rajapaksa didn’t even last long enough to see his term end.

Now, this government, too, is showing early signs of the same decline.

The ideological contradiction at the heart of the NPP

There is another challenge: though the JVP presents itself as a left-wing, Marxist-socialist party, many of those who joined the broader NPP coalition, businesspeople, academics, professionals, do not hold such ideological views. Balancing a left-leaning party with a centre-right coalition is extremely difficult. The inevitable tension between the two pulls the government in opposite directions.

The silver lining, however, is that this has produced a growing class of “floating voters”, people not permanently tied to any party, and that is actually healthy for democracy. It keeps governments accountable. Independent election commissions and civil society organisations have a major role to play in informing these voters objectively.

In more developed democracies, voters receive detailed candidate profiles and well-researched information alongside their ballot papers, including, for example, independent expert analyses of referendum questions like drug legalisation. Sri Lanka is still far from that standard. Here, many people vote the same way as their parents. In other countries, five family members might each vote differently without it being a scandal.

Three key ministries, under the President himself, all in trouble

President Dissanayake currently holds three of the most powerful portfolios himself: Defence, Digital Technology, and Finance. All three are now widely seen as performing poorly. Many commentators say the President has “failed” visibly in all three areas. The justifications offered for these failures have themselves become confused, contradictory, and, at times, just plain pitiable.

The overall picture is one of a government that looks helpless, reduced to making excuses and whining from the podium.

A cautious hope for recovery

There are still nearly three years left in this government’s term. There is time to course-correct, if they act quickly. We sincerely hope the government manages to shed this sense of helplessness and confusion, and finds a way to truly serve the country.

(The writer, a senior Chartered Accountant and professional banker, is Professor at SLIIT, Malabe. The views and opinions expressed in this article are personal.)

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Cricket and the National Interest

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The appointment of former minister Eran Wickremaratne to chair the Sri Lanka Cricket Transformation Committee is significant for more than the future of cricket. It signals a possible shift in the culture of governance even as it offers Sri Lankan cricket a fighting possibility to get out of the doldrums of failure. There have been glorious patches for the national cricket team since the epochal 1996 World Cup triumph. But these patches of brightness have been few and far between and virtually non-existent over the past decade. At the centre of this disaster has been the failures of governance within Sri Lanka Cricket which are not unlike the larger failures of governance within the country itself. The appointment of a new reform oriented committee therefore carries significance beyond cricket. It reflects the wider challenge facing the country which is to restore trust in public institutions for better management.

The appointment of Eran Wickremaratne brings a professional administrator with a proven track record into the cricket arena. He has several strengths that many of his immediate predecessors lacked. Before the ascent of the present government leadership to positions of power, Eran Wickremaratne was among the handful of government ministers who did not have allegations of corruption attached to their names. His reputation for financial professionalism and integrity has remained intact over many years in public life. With him in the Cricket Transformation Committee are also respected former cricketers Kumar Sangakkara, Roshan Mahanama and Sidath Wettimuny together with professionals from legal and business backgrounds. They have been tasked with introducing structural reforms and improving transparency and accountability within cricket administration.

A second reason for this appointment to be significant is that this is possibly the first occasion on which the NPP government has reached out to someone associated with the opposition to obtain assistance in an area of national importance. The commitment to bipartisanship has been a constant demand from politically non-partisan civic groups and political analysts. They have voiced the opinion that the government needs to be more inclusive in its choice of appointments to decision making authorities. The NPP government’s practice so far has largely been to limit appointments to those within the ruling party or those considered loyalists even at the cost of proven expertise. The government’s decision in this case therefore marks a potentially important departure.

National Interest

There are areas of public life where national interest should transcend party divisions and cricket, beloved of the people, is one of them. Sri Lanka cannot afford to continue treating every institution as an arena for political competition when institutions themselves are in crisis and public confidence has become fragile. It is therefore unfortunate that when the government has moved positively in the direction of drawing on expertise from outside its own ranks there should be a negative response from sections of the opposition. This is indicative of the absence of a culture of bipartisanship even on issues that concern the national interest. The SJB, of which the newly appointed cricket committee chairman was a member objected on the grounds that politicians should not hold positions in sports administration and asked him to resign from the party. There is a need to recognise the distinction between partisan political control and the temporary use of experienced administrators to carry out reform and institutional restructuring. In other countries those in politics often join academia and civil society on a temporary basis and vice versa.

More disturbing has been the insidious campaign carried out against the new cricket committee and its chairman on the grounds of religious affiliation. This is an unacceptable denial of the reality that Sri Lanka is a plural, multi ethnic and multi religious society. The interim committee reflects this diversity to a reasonable extent. The country’s long history of ethnic conflict should have taught all political actors the dangers of mobilising communal prejudice for short term political gain. Sri Lanka paid a very heavy price for decades of mistrust and division. It would be tragic if even cricket administration became another arena for communal suspicion and hostility. The present government represents an important departure from the sectarian rhetoric that was employed by previous governments. They have repeatedly pledged to protect the equal rights of all citizens and not permit discrimination or extremism in any form.

The recent international peace march in Sri Lanka led by the Venerable Bhikkhu Thich Paññākāra from Vietnam with its message of loving kindness and mindfulness to all resonated strongly with the masses of people as seen by the crowds who thronged the roadsides to obtain blessings and show respect. This message stands in contrast to the sectarian resentment manifested by those who seek to use the cricket appointments as a weapon to attack the government at the present time. The challenges before the Sri Lanka Cricket Transformation Committee parallel the larger challenges before the government in developing the national economy and respecting ethnic and religious diversity. Plugging the leaks and restoring systems will take time and effort. It cannot be done overnight and it cannot succeed without public patience and support.

New Recognition

There is also a need for realism. The appointment of Eran Wickremaratne and the new committee does not guarantee success. Reforming deeply flawed institutions is always difficult. Besides, Sri Lanka is a small country with a relatively small population compared to many other cricket playing nations. It is also a country still recovering from the economic breakdown of 2022 which pushed the majority of people into hardship and severely weakened public institutions. The country continues to face unprecedented challenges including the damage caused by Cyclone Ditwah and the wider global economic uncertainties linked to conflict in the Middle East. Under these difficult circumstances Sri Lanka has fewer resources than many larger countries to devote to both cricket and economic development.

When resources are scarce they cannot be wasted through corruption or incompetence. Drawing upon the strengths of all those who are competent for the tasks at hand regardless of party affiliation or ethnic or religious identity is necessary if improvement is to come sooner rather than later. The burden of rebuilding the country cannot rest only on the government. The crisis facing the country is too deep for any single party or government to solve alone. National recovery requires capable individuals from across society and from different sectors such as business and civil society to work together in areas where the national interest transcends party politics. There is also a responsibility on opposition political parties to support initiatives that are politically neutral and genuinely in the national interest. Not every issue needs to become a partisan battle.

Sri Lanka cricket occupies a special place in the national consciousness. At its best it once united the country and gave Sri Lankans a sense of pride and international recognition. Restoring integrity and professionalism to cricket administration can therefore become part of the larger task of national renewal. The appointment of Eran Wickremaratne and the new committee, while it does not guarantee success, is a sign that the political leadership and people of the country may be beginning to mature in their approach to governance. In recognising the need for competence, integrity and bipartisan cooperation and extending it beyond cricket into other areas of national life, Sri Lanka may find the way towards more stable and successful governance..

by Jehan Perera

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From Dhaka to Sri Lanka, three wheels that drive our economies

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Court vacation this year came with an unexpected lesson, not from a courtroom but from the streets of Dhaka — a city that moves, quite literally, on three wheels.

Above the traffic, a modern metro line glides past concrete pillars and crowded rooftops. It is efficient, clean and frequently cited as a symbol of progress in Bangladesh. For a visitor from Sri Lanka, it inevitably brings to mind our own abandoned light rail plans — a project debated, politicised and ultimately set aside.

But Dhaka’s real story is not in the air. It is on the ground.

Beneath the elevated tracks, the streets belong to three-wheelers. Known locally as CNGs, they cluster at junctions, line the edges of markets and pour into narrow roads that larger vehicles avoid. Even with a functioning rail system, these three-wheelers remain the city’s most dependable form of everyday transport.

Within hours of arriving, their importance becomes obvious. The train may take you across the city, but the journey does not end there. The last mile — often the most complicated part — belongs entirely to the three-wheeler. It is the vehicle that gets you home, to a meeting or simply through streets that no bus route properly serves.

There is a rhythm to using them. A destination is mentioned, a price is suggested and a brief negotiation follows. Then the ride begins, edging into traffic that feels permanently compressed. Drivers move with instinct, adjusting routes and squeezing through gaps with a confidence built over years.

It is not polished. But it works.

And that is where the comparison with Sri Lanka becomes less about what we lack and more about what we already have.

Back home, the three-wheeler has long been part of daily life — so familiar that it is often discussed only in terms of its problems. There are frequent complaints about fares, refusals or the absence of meters. More recently, the industry itself has become entangled in politics — from fuel subsidies to regulatory debates, from election-time promises to periodic crackdowns.

In that process, the conversation has shifted. The three-wheeler is often treated as a problem to be managed, rather than a service to be strengthened.

Yet, seen through the experience of Dhaka, Sri Lanka’s system begins to look far more settled — and, in many ways, ahead.

There is a growing structure in place. Meters, while not perfect, are widely recognised. Ride-hailing apps have added transparency and reduced uncertainty for passengers. There are clearer expectations on both sides — driver and commuter alike. Even small details, such as designated parking areas in parts of Colombo or the increasing standard of vehicles, point to an industry slowly moving towards professionalism.

Just as importantly, there is a human element that remains intact.

In Sri Lanka, a three-wheeler ride is rarely just a transaction. Drivers talk. They offer directions, comment on the day’s news, or share local knowledge. The ride becomes part of the social fabric, not just a means of getting from one point to another.

In Dhaka, the scale of the city leaves less room for that. The interaction is quicker, more direct, shaped by urgency. The service is essential, but it is under constant pressure.

What stands out, across both countries, is that the three-wheeler is not a temporary or outdated mode of transport. It is a necessity in dense, fast-growing Asian cities — one that fills gaps no rail or bus system can fully address.

Large infrastructure projects, like light rail, are important. They bring efficiency and long-term capacity. But they cannot replace the flexibility of a three-wheeler. They cannot reach into narrow streets, respond instantly to demand or provide that crucial last-mile connection.

That is why, even in a city that has invested heavily in modern rail, Dhaka still runs on three wheels.

For Sri Lanka, the lesson is not simply about what could have been built, but about what should be better managed and valued.

The three-wheeler industry does not need to be politicised at every turn. It needs steady regulation — clear fare systems, proper licensing, safety standards — alongside encouragement and recognition. It needs to be seen as part of the solution to urban transport, not as a side issue.

Because for thousands of drivers, it is a livelihood. And for millions of passengers, it is the most immediate and reliable form of mobility.

The tuk-tuk may not feature in grand policy speeches or infrastructure blueprints. It does not run on elevated tracks or attract international attention. But on the ground, where daily life unfolds, it continues to do what larger systems often struggle to do — show up, adapt and keep moving.

And after watching Dhaka’s streets — crowded, relentless, yet functioning — that small, three-wheeled vehicle feels less like something to argue over and more like something to get right.

(The writer is an Attorney-at-Law with over a decade of experience specialising in civil law, a former Board Member of the Office of Missing Persons and a former Legal Director of the Central Cultural Fund. He holds an LLM in International Business Law)

 

by Sampath Perera recently in Dhaka, Bangladesh 

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