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ADB launches $40m emergency aid for Lanka after Ditwah

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The Asian Development Bank (ADB) has launched a $40 million emergency assistance facility, under its Trade and Supply Chain Finance Programme (TSCFP), to support Sri Lanka’s recovery from the devastation of Cyclone Ditwah.

The facility will help finance essential imports, including food, medicines, and critical relief supplies, as the country rebuilds damaged infrastructure and livelihoods.

This new facility is in addition to the $200 million in existing ADB TSCFP capacity for Sri Lanka. To rapidly scale up support, the programme mobilised its longstanding risk partners, Munich Re and Swiss Re, to provide the additional backing required. The financing will be channelled through ADB TSCFP’s network of six partner banks in Sri Lanka, ensuring swift delivery to meet urgent needs.

“Cyclone Ditwah has severely disrupted access to vital goods, compounding existing challenges,” said ADB Country Director for Sri Lanka Takafumi Kadono. “By partnering with Munich Re, Swiss Re, and our local banks, we are ensuring that critical supply chains for essentials remain operational. This support is crucial for immediate relief, longer-term recovery, and rehabilitation.”

Recent cyclone-induced heavy rains and massive flooding have caused extensive damage to infrastructure, housing, and agricultural land across the country. This has intensified the need for a sustained flow of relief goods and medical supplies to affected communities.

The initiative sustains ADB’s ongoing commitment to providing targeted trade finance during crises. It builds on ADB TSCFP’s prior support for vaccine imports during the coronavirus disease (COVID-19) pandemic and emergency trade finance during Sri Lanka’s economic crisis, demonstrating a sustained commitment to maintaining trade resilience.

Backed by ADB’s AAA credit rating, TSCFP delivers guarantees and loans through more than 200 partner banks to support trade and create import and export opportunities for businesses. The programme is a key partner in helping diversify trade both internationally and intra-regionally within Asia and the Pacific. Since 2009, it has supported over $74 billion in trade, focusing on sectors that promote sustainable growth and regional integration.

ADB is a leading multilateral development bank supporting inclusive, resilient, and sustainable growth across Asia and the Pacific. Working with its members and partners to solve complex challenges together, ADB harnesses innovative financial tools and strategic partnerships to transform lives, build quality infrastructure, and safeguard our planet. Founded in 1966, ADB is owned by 69 members—50 from the region.



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Sri Lanka, India caught in US-Iran ship crisis

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By Shamindra Ferdinando

Iran has sought the Indian intervention, at the highest level, to provide lifesaving support to the crews of empty Iranian vessels stranded just outside Sri Lanka’s 12-nautical mile territorial waters off Galle.

Sources familiar with the issue said that Iran had brought the developing situation to the attention of New Delhi as the crews of almost 20 vessels, included Indian nationals. Sources stressed that the group of vessels that unloaded crude oil a couple of months back were now stranded within Sri Lanka’s Exclusive Economic Zone (EEZ).

The US Navy torpedoed an unarmed Iran frigate, returning from India, on 04 March, 2026, about 19 nautical miles off the Galle coast. The unprovoked attack killed nearly 100 Iranians.

The Iranian Embassy in Colombo has inquired from the Indian High Commission of their response to the situation, sources said. The US has issued a global warning against providing food, water, medicine and other services to the Iranian vessels. The outcome of Iran-India talks on the issue at hand was not known, though sources asserted India may not throw its weight behind Iranian efforts to address the issue.

Responding to The Island queries, sources said both Sri Lanka and India were in a dilemma due to the US warning. India couldn’t ignore the plight of the Indian crew members and the Iranian vessels in its backyard.

The Sri Lankan government remains tight-lipped about the vessels stranded in its EEZ. Our efforts to elicit a response from relevant authorities were in vain. In addition to Indians, there are Bangladeshis among the crew members. Iran has explicitly stated the responsibilities of the countries concerned to provide assistance in terms of international law.

The Iranian position was articulated by its Ambassador to Sri Lanka, Dr.Alireza Delkhosh, recently. In a special statement, Ambassador Delkhosh emphasised that in terms of the Convention on the Law of the Sea (Article 98) as well as SOLAS and SAR

Conventions, Sri Lanka couldn’t refrain from providing the needs of the Iranian vessels stranded in its EEZ.

SLMC leader Rauff Hakeem lambasted the NPP government in Parliament for failing to provide assistance to the Iranian ships. The former Minister alleged that the government was simply carrying out dictates of the US. He strongly criticised the way Foreign Minister Vijitha Herath was handling the issue.

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Namal further remanded

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MP Namal Rajapaksa being brought to the Colombo Magistrate’s Court yesterday. Pic by Nishan S Priyantha

MP Namal Rajapaksa, who is in remand custody over the controversial Airbus deal, was further remanded until October 27 by the Colombo Magistrate’s Court yesterday (13).

Colombo Chief Magistrate Asanga S. Bodaragama made the order after considering submissions by officers of the Commission to Investigate Allegations of Bribery or Corruption and lawyers representing Rajapaksa.

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IMF projects Lankan economic growth to moderate amidst mounting global uncertainties

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Sri Lanka’s economy is expected to sustain its recovery over the next two years, although growth is projected to moderate amid mounting global uncertainties, according to the International Monetary Fund’s (IMF) latest World Economic Outlook.

In its World Economic Outlook 2026: Resilience Under Strain, Urgent Choices, the IMF projects Sri Lanka’s economy to expand by 4% in 2026, slowing to 3.7% in 2027, following estimated growth of 5% in 2025.

Inflation, meanwhile, is forecast to rise to 5.3% in 2026 and 5.4% in 2027, reversing the average deflation rate of 0.5% recorded in 2025.

Unemployment is expected to remain steady at 3.9% throughout the forecast period.

The projections come amid growing pressure on the global economy from the ongoing conflict in the Middle East, elevated energy prices, geopolitical tensions and trade disruptions.

Sri Lanka’s external position is also expected to weaken, with the current account balance projected to shift from a surplus of 1.6% of gross domestic product (GDP) in 2025 to deficits of 0.5% in 2026 and 0.3% in 2027.

The IMF’s outlook points to continued economic expansion in Sri Lanka, but with slower growth, rising inflation and a narrowing external surplus giving way to current account deficits over the forecast period.

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