News
Lanka can’t afford fossil fuels but can’t afford to get off them either
(climatechangenews)
Sri Lanka is in turmoil, with fuel and food shortages provoking citizens to storm the presidential palace and send Gotobaya Rajapaksa packing.Reliance on fossil fuel imports is a big factor in the economic crisis. Fuel prices spiking while tourism stayed in the doldrums led to the country running out of foreign currency, not helped by chronic fiscal mismanagement.
That same economic crisis is now making it harder than ever for Sri Lanka to develop a renewable industry, energy experts and business owners say.On 31 March, protesters marched on president Gotabaya Rajapaksa’s private residence. Things escalated until on 9 July, they stormed the presidential palace, prompting Rajapaksa to resign and flee to Singapore. He appointed an ally, Ranil Wickremesinghe, as his successor and this week a Sri Lankan official said Rajapaksa himself would return to the country, dampening hopes of substantive political change.
Sri Lanka’s economic crisis stems from consistently importing more than it exports. As the country pays in foreign currency (largely US dollars) for imports and sells in foreign currency for exports, its central bank’s foreign currency reserves have been depleting.The government didn’t have enough Sri Lankan rupees to pay for imports so prices of products, including essentials like food and fuel, shot up.
Between 1990 and 2000, Sri Lanka’s net energy imports as a percentage of total energy use doubled from 20% to 40% and has stayed around the same ever since. In 2021, the country spent $3.7bn on imports of oil and coal. Sri Lanka has no significant fossil fuel reserves. It does, according to the World Bank, have good potential for solar and wind power. Yet it has failed to develop either technology. It gets around a third of its electricity from imported oil, a third from imported coal and a third from domestic hydropower.
Lankan journalist Rathindra Kuruwita said this failure to develop renewables was largely the fault of the island’s state-owned monopoly utility provider, the Ceylon Electricity Board.
“Most of the engineers are in cahoots with the power plant mafia,” he said. This “mafia” is not an organised crime mob, but a network of people with a vested interest in fossil fuels: power plant operators, diesel distributors and coal importers.
The Sri Lanka Sustainable Energy Authority has also been slow in approving licenses for renewable projects, he said. If those projects had been approved, Kuruwita added, “we wouldn’t be in this mess”.
When an electrical engineer named Champika Ranawaka became energy minister in 2015, he tried to reform the CEB, Kuruwita said. He lasted eight months in the role.Now the country has run out of foreign currency to import the amount of fossil fuels its infrastructure needs. There are shortages of electricity, of cooking gas and of fuel for vehicles and for the diesel generators used as back-up power.
Before terrorist attacks in 2019 and the coronavirus pandemic, tourism provided 6% of Sri Lanka’s GDP. There were hopes it would rebound this year and bring in much needed foreign currency.But Nimesh, who works in the Atha resort in central Sri Lanka, told Climate Home that tourists are finding it hard to find vehicles to transport them as drivers are having to queue for days to get fuel.On top of that, small hotels and restaurants are suffering from power cuts. Larger hotels have generators but are finding it difficult to find fuel for them.
“These power cuts and fuel shortages are really affecting the tourism industry,” he said.
Lien Wysmans runs a backpackers’ hostel on Arugam Bay beach in the island’s east. She told Climate Home: “There are power cuts as well of about four or five hours a day… I’m freaking out”.
Although Wysmans says her guests don’t mind the power cuts, others are less tolerant. A March 2022 review for a beachfront Airbnb gives one star, citing “power cut- not their fault but created problem for us” among the reasons.A Financial Times reporter who visited the country recently said: “Anyone considering a trip to Sri Lanka this year or next also faces a difficult choice. Avoid the country entirely and the risk of a severely impacted and unexpectedly expensive trip, or support a vulnerable economy unduly impacted by the pandemic and poor management.”
Electric vehicles (with enough electricity) and rooftop solar panels would solve many of the tourist industry’s problems. But rolling them out requires money which most Sri Lankan citizens and their government don’t have.
Wysmans said solar panels “would be definitely a very good solution”. She can’t install them as she is renting the property but, even if she owned it, she said that the return on investment is 25 years. “It’s economically not beneficial for anybody because it’s just too expensive,” she said. “Also, the government is not really supporting.”
Nimesh said: “Solar panels are a great solution but the problem is government can’t afford to give financial support to invest in these projects due to the critical financial crisis that our country is facing”.
There are international schemes to help, like a Asian Development Bank funded scheme to provide low-interest loans for rooftop solar power. But these are on a small scale.
Speaking from her native Belgium, Wysmans said: “Sri Lanka has a really great opportunity for being a self-sustainable renewable energy island but the corruption is stopping all of it.”
“They’ve got the sun, they’ve got the water, they’ve got the wind, they just need to do it,” she added, “but if you have a corrupt government who wants to bring oil in where they can put half the money in their own pocket, it’s never going to happen.”
The Sustainable Energy Authority did not reply to a request for comment.
News
President chairs 2027 Pre-Budget talks on Agriculture Ministry
A discussion to review the progress of projects being implemented under the 2026 budget allocations for the Ministry of Agriculture, Livestock, Land and Irrigation, and to consider the Ministry’s budgetary requirements for 2027, was held on Tuesday (07) morning at the Presidential Secretariat under the chairmanship of President Anura Kumara Dissanayake.
During the meeting, the progress of projects implemented in 2026 by institutions under the Ministry, including the Department of Agriculture, the Department of Agrarian Development, the Department of Export Agriculture and the Institute of Post-Harvest Technology (IPHT), was reviewed individually. Attention was also focused on institutions requiring restructuring to enhance efficiency and effectiveness.
The President instructed that all irrigation projects maintained by various institutions, departments and local authorities should be regulated through a single district-level unit. He also directed that irrigation rehabilitation projects being implemented across the island be comprehensively mapped.
Emphasising the need to maximise the utilisation of funds allocated under the 2026 Budget, the President instructed officials to further promote concessionary bank loan facilities available to young entrepreneurs in the agriculture and industrial sectors.
The President also instructed officials to submit a report containing proposals for the integrated and systematic management of extension services currently operating under various ministries. He further highlighted the importance of holding separate discussions on individual subject areas to ensure seamless coordination between the Provincial Councils and the Central Government.
The President also directed officials to submit new proposals and projects aimed at promoting export agricultural crops and increasing the value of related products.
The meeting also reviewed projects launched in recent years with foreign loan assistance. As many had exceeded their scheduled completion dates, the President instructed officials to expedite their completion. He further emphasised that, in future, no project financed through foreign loans should be approved without a clear understanding of its intended outcomes.
It was also noted that the Government had incurred a significant financial burden due to the failure to complete certain projects initiated in previous years within the stipulated timeframe. Accordingly, it was decided to review projects that had not been completed on schedule.
The discussion also highlighted the importance of replacing outdated projects and programmes that have continued for many years without delivering tangible results with more productive agricultural programmes.
Minister of Agriculture, Livestock, Land and Irrigation K.D. Lalkantha; Minister of Labor and Deputy Minister of Finance and Planning Dr. Anil Jayantha Fernando; Deputy Minister of Agriculture and Livestock Namal Karunaratne; Deputy Minister of Land and Irrigation Aravinda Senarath; Secretary to the President Dr Nandika Sanath Kumanayake; Secretary to the Treasury and Ministry of Finance, Planning and Economic Development, Dr.Harshana Suriyapperuma; Senior Additional Secretary to the President Kapila Janaka Bandara; Secretary to the Ministry of Energy and Senior Additional Secretary to the President Russell Aponsu; Secretary to the Ministry of Agriculture, Livestock, Land and Irrigation D.P. Wickramasinghe; and officials of the Ministry of Finance, Planning and Economic Development and the Ministry of Agriculture, Livestock, Land and Irrigation were also present at the discussion.
News
Committee Appointed to investigate unrest at Negombo Prison
A Committee of Inquiry was appointed on Tuesday (07) by Secretary to the President Dr Nandika Sanath Kumanayake, with Cabinet approval, to conduct a comprehensive investigation into the unrest that occurred at Negombo Prison on 5 and 6 July and to report on the circumstances that led to the incident.
The Committee is chaired by retired Supreme Court Judge Priyantha Fernando. Its other members are Additional Solicitor General and President’s Counsel Milinda Gunatilake and President’s Counsel Mohan Weerakoon. Senior Assistant Secretary to the President K.L.D. Asela has been appointed Secretary/Convener of the Committee of Inquiry.
News
“Badhu Shakthi 2026” National Tax Week begins
The inaugural ceremony of “Badhu Shakthi 2026” (“බදු ශක්ති 2026”) National Tax Week, organised by the Revenue Administration Reform and Modernisation Unit of the Presidential Secretariat with the objective of strengthening State revenue generation and accelerating the country’s future development process, was held on Monday (06) morning at the Presidential Secretariat under the patronage of Speaker Dr Jagath Wickramaratne.
“Badhu Shakthi 2026” is a year-round national programme aimed at transforming the negative public perception of taxation into a positive one while fostering a culture of voluntary tax compliance. To mark its commencement, a National Tax Week will be observed across the island from 6 to 10 July.
A nationwide media and public awareness campaign will be conducted in parallel, including the distribution of leaflets and a range of promotional activities designed to educate the public directly and encourage greater tax compliance.
Addressing the inaugural event, Speaker Dr Jagath Wickramaratne stated that “Badhu Shakthi 2026” is not simply a tax collection campaign but a national initiative aimed at cultivating responsible citizens who love their country.
Further elaborating, the Speaker said:
“Today marks a significant milestone in our country’s future development and economic stability. The strength and sustainability of any sovereign nation depend on its economic independence. Taxation is one of the key instruments for strengthening State revenue and driving national development.
However, taxation has long been viewed negatively by many people. That perception was largely shaped by those responsible for collecting taxes and by successive administrations. When people develop a sense of national responsibility, their attitudes begin to change. For many years, taxes were regarded as a burden. History has shown us that tax evasion occurred on a significant scale, and it must be acknowledged, however reluctantly, that such practices often enjoyed political patronage.
In the past, the public had little understanding of how their tax contributions were utilised. Taxpayers lacked a clear vision of the benefits derived from the taxes they paid. The present Government has succeeded in changing this situation by fostering a more positive public attitude towards taxation. I wish to pay tribute to all taxpayers who contribute towards the Government’s national development agenda.
Today, people have confidence that the taxes they pay are being put to good use. Expressways, highways and power infrastructure projects are now being implemented using domestic funds. There is a sense of pride among the public that construction of the Kandy Expressway has commenced without obtaining loans from any external source. Cabinet approval has also been granted to commence work on the Kurunegala–Galewela Road.
Today, Sri Lanka has grown stronger as a nation capable of financing development activities through domestic resources rather than relying on foreign borrowing.
In ancient times, the country’s great stupas, reservoirs and irrigation networks were built through the collective contribution of the people. Likewise, Sri Lanka can become a prosperous and developed nation only through collective effort. The taxes collected today are being utilised for the welfare of the people. This was clearly demonstrated when the Government allocated Rs. 500 billion in response to Cyclone Ditwah. In addition, substantial benefits are now being provided to the public through the President’s Fund. Educational assistance is being extended to schoolchildren across every corner of the country. All of these initiatives are being financed through domestic resources.
It is essential that the public are made aware of the real benefits derived from tax revenue and of the development projects being implemented. This will strengthen public confidence in the transparent use of tax revenue. The primary objective of this national programme is to broaden the country’s tax base, improve tax compliance, reduce tax evasion and foster a positive attitude towards taxation. If everyone pays their fair share of taxes, the tax burden borne by others can be reduced.
We do not build a beehive with a single bee. It is created through the collective effort of thousands of bees, making it a remarkable achievement. Likewise, ‘Badhu Shakthi 2026’ is not merely a tax collection campaign. It is a national movement to cultivate responsible citizens who love their country. I extend my sincere appreciation to everyone who has dedicated themselves to making this important initiative a success.”
Labour Minister and Deputy Minister of Finance and Planning Anil Jayantha Fernando:
Labour Minister and Deputy Minister of Finance and Planning Dr. Anil Jayantha Fernando said that a proper understanding of taxation among citizens would enable Sri Lanka to make greater progress towards economic and social transformation.
He noted that while individuals naturally pursue their own personal goals and aspirations, many of these objectives cannot be achieved in isolation. The success of any society depends on cooperation and collective effort.
He further stated:
“Today, paying taxes has become a much simpler process. As a result, tax collection is now carried out more efficiently and systematically. At the same time, the Government recognises its responsibility to ensure that tax revenue collected fairly is managed prudently and utilised for the benefit of society. If the Government fails to demonstrate sound financial discipline, people will lose confidence and become reluctant to pay taxes. This was evident in the past.
Accordingly, the Government has introduced a tax administration system founded on strong fiscal discipline. We will not tolerate fraud, corruption or waste. If we are to rebuild this country, every citizen must contribute willingly and with a sense of national responsibility. This should not be driven solely by legal obligation. We are confident that the people of Sri Lanka will fulfil this responsibility.”
Deputy Minister of Economic Development Nishantha Jayaweera, Director General of Customs Wimal Liyanagama, Director General of Excise M.B.N.A. Premaratne, and Commissioner General of Inland Revenue Rukdevi Fernando also addressed the gathering.
Among those present were Director General of Public Relations to the President Dharmasiri Gamage, senior officials of the Presidential Secretariat, the Ministry of Finance, Sri Lanka Customs, the Department of Excise, the Inland Revenue Department, as well as taxpayers and other invited participants.
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