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Auto companies slam brakes on Sri Lanka exports, production

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Mumbai: A severe economic crisis in Sri Lanka has forced many Indian automotive firms to slam the brakes on exports of vehicle kits as well as production at the local assembly operations they have set up in the island nation.

Shipments of vehicle kits, including those for light commercial vehicles, trucks and buses, have declined sharply, as the neighboring country is grappling with precarious forex reserves and fuel shortages, said industry executives.

While companies like Tata Motors have been exporting vehicle kits to distributors in Sri Lanka, others such as Mahindra & Mahindra, Ashok Leyland and TVS Motors have local assembly operations in the country.

“We are unable to get the kits, so we cannot put finished products out in the market,” said Rajeev Pandithage, chief operating officer-mobility sector at Diesel & Motor Engineering, one of the oldest and largest dealers for Tata Motors and Mahindra tractors in Sri Lanka.

Imports of vehicle kits are heavily restricted in Sri Lanka owing to the forex crunch.

Diesel & Motor Engineering had started assembly of the Tata Ace small commercial since there were import restrictions on completely built units of vehicles. It wants to launch the vehicle soon given the huge demand for such low-cost vehicles, said Pandithage.

Besides, the distributor can import fully built tractors. However, Pandithage said, “We are facing forex issues to open LCs (letters of credit). Before the season starts, we have a stock of at least 1,000 tractors. This time we have just about 150, which is clearly not enough.”

Farmers want to buy new tractors, he said, but higher interest rates and rising inflation are not allowing them to do so.

A Tata Motors spokesperson said the company stays committed to the Sri Lanka market and prays that the country recovers from the crisis at the earliest. “Tata Motors continues to have a positive outlook about the Sri Lanka market,” said the spokesperson.

Tata Motors has been running its operations in Sri Lanka since 1961 and the country continues to be a priority market. “The company has consistently grown grown over the years and is now the largest selling commercial vehicle brand in Sri Lanka. It has the widest range of products, from the 750 kg Ace to 45-tonne Prima trucks,” said the company spokesperson.

Two-wheeler maker Bajaj Auto said due to the forex shortage, imports of most auto products including two-wheelers and three-wheelers were stopped by the Sri Lankan government almost a year ago. “As a result, our exports in the previous year were negligible. In 2019-20, we exported over 30,000 units, which also was a decline over the previous highs,” said Rakesh Sharma, executive director, Bajaj Auto. “A small restart was made recently based on efforts to localise and generate employment there. Now, with this dislocation, we have to wait and see how that initiative unfolds.”

Mahindra & Mahindra set up assembly operations in Sri Lanka with the Ideal Group to produce the KUV 100 mini sport utility vehicle (SUV) and Bolero Maxi pickup truck in August 2019. “We cannot ramp up production as there is difficulty in sourcing,” said Nalin Welgama, executive chairman, Ideal Group. “The target was to sell at least 5,000 vehicles a year through this JV (joint venture). We sell about 200-250 of such vehicles a month. Our assembly is continuing despite the forex challenges.”

The KUV 100 and the Bolero Maxi are entry-level products and there is a good demand for them, he said.

Distributors are hoping they can accelerate production of such low-cost vehicles, which continue to have a good demand in Sri Lanka.

Mahindra & Mahindra set up a completely-knocked-down assembly plant in Welipenna through a JV with local partner Ideal Motors. “Our vehicles including KUV 100 and Bolero City Pickup have been well received. Further, last week, M&M signed an agreement with Sri Lanka Police for 750 Scorpio SUVs,” said a company spokesperson.With over 35,000 customers in Sri Lanka, M&M remains committed to the long-term prospects of the market and will continue to work on building and strengthening its brand and position in the country.”

TVS Motors retails several of its two-wheeler models such as the 100 cc economy motorcycle TVS Sport and the 125 cc scooter TVS NTORQ Race Edition through local assembly. The launch of this scooter, in January 2020, triggered a turnaround in the Sri Lankan scooter segment.

In January this year, the Sri Lankan government approved the purchase of 500 buses from Ashok Leyland for its transport board.

Queries emailed by ET to TVS Motors and Ashok Leyland did not elicit a response till press time.

As Sri Lanka battles the worsening crisis, automakers realise that production cannot be immediately ramped up due to economic uncertainty and low business activity, said industry executives. However, local players are confident that production will not come to a complete halt, they said.

As Sri Lanka moved from a market economy to a product economy, exports of CBUs (completely built units) came to a halt

Due to forex shortages, imports of most auto products including for 2- and 3-wheelers were stopped by the Sri Lankan govt

Automakers are adopting a wait-and-watch approach because of economic uncertainty and low business activity

Covid sent Lankan economy into a tailspin, drying up earnings from tourism, foreign remittances In March 2020, the govt imposed an import ban on new cars, which left car parts in short supply. (ToI)



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The guidance of Religious Leaders is essential to strengthen coexistence among communities. — Prime Minister

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Prime Minister Dr. Harini Amarasuriya stated that the guidance or religious leaders is essential to further strengthen harmony and solidarity among communities in multicultural areas such as Anamaduwa, where Sinhala, Tamil, and Muslim communities live together.

The Prime Minister made these remarks while addressing the official ceremony of presenting the Sannas Patra to confer the title of Chief Sanghanayaka of the Rajavanni and Kumaravanni two provinces upon Venerable Dharmakeerthi Sri Pangnananda Nayaka Thero of Anamaduwa. The ceremony was held on Wednesday (13) at Sudampaya, Anamaduwa.

The event was held under the patronage of the Anunayaka Thero of the Malwathu Chapter, Most Venerable Niyangoda Vijithasiri Thero. During the ceremony, Prime Minister Dr. Harini Amarasuriya formally presented the official declaration appointing Venerable Dharmakeerthi Sri Pangnananda Nayaka Thero as the Chief Sanghanayaka of the Rajavanni and Kumaravanni provinces. The ceremonial Vijinipatha was presented by Opposition Leader Sajith Premadasa.

Addressing the gathering, the Prime Minister stated:

“Venerable Dharmakeerthi Sri Pangnananda Nayaka Thero of Anamaduwa is a distinguished member of the Maha Sangha who has rendered invaluable service to both the Buddha Sasana and the education sector through the country nearly 50 years of monastic life and 35 years of service as an educator.

His service is not confined merely to religious observances. He has sheltered the children and people of the area in times of both hardship and happiness. In particular, it is important to remember the humanitarian leadership he demonstrated in providing relief to the people of the Puttalam District affected by cyclone Ditwah, which became a source of strength for the entire region.

His dedication towards restoring and preserving historic religious sites, including the Paramakanda Rajamaha Viharaya, for future generations is commendable.

As the government strives to lead the country towards ’a new era of renaissance’ built upon compassion and solidarity, the guidance and blessings of religious leaders such as him are of immense value to the government”.

The occasion was graced by the presence of members of the Maha Sangha representing the three Nikayas, clergy of other religions, and attended by the Governor of the North Western Province, Minister of Public Administration, Provincial Councils and Local Government Chandana Abayarathna, Diyawadana Nilame Nilanga Dela Bandara, Members of Parliament, government officials, and a large number of devotees.

[Prime Minister’s Media Division]

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Special Coordination Committee meeting for Badulla District chaired by the President

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A Special Coordination Committee meeting for the Badulla District was held on Wednesday (13)  afternoon  at the Badulla District Secretariat under the patronage of President Anura Kumara Dissanayake to review the progress of measures taken to restore normalcy to the lives of people affected by the cyclone “Ditwah” and to develop infrastructure in the district.

As a result of the disaster situation, 90,667 individuals belonging to 26,517 families in the Badulla District were affected. A total of 77 estate houses and 507 rural houses suffered complete damage. In addition, 1,376 estate houses and 1,474 rural houses have been identified as high-risk dwellings. Accordingly, the total number of families that need to be resettled in the Badulla District is 3,434. During the meeting, the President inquired separately at divisional secretariat level about the resettlement process and the issues that had arisen.

Special attention was also given to the speedy release of state lands currently occupied by private companies, which have been proposed for resettlement purposes. The President instructed officials to commence housing construction work immediately after reaching agreement among the relevant institutions regarding the release of these lands.

The President further emphasized the need to expedite the resettlement process and stated that authorities should move beyond reports and plans and ensure that people who lost their homes gain confidence and hope in owning a new house.

The President also instructed that people who are hesitant about relocating to different lands should be given time until June 15 to make a decision.

The President separately reviewed the progress of compensation payments to affected people in the Badulla District, including compensation for loss of livelihoods, compensation for small and medium-scale business establishments, housing rental assistance and compensation for loss of life.

Attention was also drawn to the process of removing sand and rocks deposited on paddy fields and agricultural lands due to the disaster. It was decided to provide an allowance of Rs. 25,000 per acre for this purpose and to implement the programme with the support of farmer organizations.

Special focus was also given to the development of roads in the Badulla District damaged by the disaster. The President instructed that work on all 21 affected roads under the Road Development Authority be completed within this year.

The President also inquired about the programme being carried out for provincial road development and the required allocations and instructed officials to prepare and submit estimates for the necessary funding for all those roads.

The President further instructed officials not to consider financial constraints as an obstacle in restoring normal life for those affected by the disaster. President Dissanayake stated that the district should recover from the destruction caused by the cyclone within this year and be prepared to restart the Badulla District development programme from next year onward.

Also attending the meeting were Badulla District Coordination Committee Chairman and Minister of Plantation and Community Infrastructure, Samantha Vidyarathna; Co-Chairman and Uva Province Governor, Attorney-at-Law Kapila Jayasekara; Deputy Minister of Tourism, Ruwan Ranasinghe; Deputy Minister of Youth Affairs, Dinidu Saman Hennayake; Members of Parliament Kitnan Selvaraj and Ravindra Bandara; the Mayors of Badulla and Bandarawela Municipal Councils; Chairpersons of Local Councils; public representatives; the Chief Secretary of the Uva Province; the District Secretary; government officials of the Badulla District; Heads of relevant Departments; and representatives of the security forces.

(PMD)

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SJB flays PUCSL for shifting coal scandal losses to electricity consumers

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Sajith Premadasa

Alleging that the Public Utilities Commission of Sri Lanka (PUCSL) has shifted the massive losses, caused by the coal scam, to the hapless public, Opposition and SJB Leader, Sajith Premadasa, has questioned the conduct of the regulator, noting that it is mandated to protect the interests of both the service provider and the consumers.

Premadasa alleged that the PUCSL ignored the representations made by the SJB on behalf of local industries.

Premadasa said that the PUCSL had authorised the latest 18% increase, in response to the request made by the recently established National System Operator (Pvt) Ltd (NSO), on behalf of the NPP government.

The PUCSL was established in terms of the Public Utilities Commission of Sri Lanka Act, No. 35 of 2002. Although the PUCSL was supposed to function as a multi-sector regulator for electricity, water services and petroleum industries, successive governments refrained from bringing water services and petroleum industries under its purview.

The Opposition leader alleged that the PUCSL did the bidding of the government.

Since January this year, PUCSL has increased electricity tariffs on three occasions. The latest came into operation on 11 May.

The PUCSL consists of Prof. K. P. L. Chandralal (Chairman), Engineer Piyal Henanayake (Deputy Chairman), Dr. M.C.S. Fernando, and Lilantha Samaranayake, PhD.

Premadasa said that instead of taking tangible measures to recover the unbearable losses caused by the coal scam, the government burdened the entire country through the PUCSL.

“Don’t forget that the government is shielding its henchmen responsible for the coal scam at the expense of the country,” MP Premadasa said, pointing out that there couldn’t have been any dispute over their culpability, after the National Audit Office (NAO) found fault with the Energy Ministry for granting the tender for the supply of coal for the 2025/2026 season to a company not qualified even to participate in the tender process.

The SJB leader declared that the resignation of Energy Minister, Kumara Jayakody, and its Secretary, Prof. Udayanga Hemapala, in the immediate aftermath of Parliament defeating a no-faith motion against the Minister was meant to protect the ruling party.

The PUCSL has stated that the NSO received Rs 15 bn from the government to grant relief to 95% of the consumers. “How could the PUCSL justify unbearable electricity tariff increases for the remaining 5% of the consumers, knowing very well that it will destabilise key sectors in the economy?” a power sector expert said.

By Shamindra Ferdinando

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