Business
‘CB continues to maintain equilibrium between capital formation and economic growth’
by Sanath Nanayakkare
The Monetary Board of the Central Bank has noted the need to continue the monetary policy support to maintaining the trend of declining lending rates which is crucial for capital formation, which in turn increases investment and helps boost the economic activities post-pandemic, Central Bank Governor Prof. W.D Lakshman said yesterday.
He made this comment when the Central Bank announced its third Monetary Policy Review for the Year 2021.
Lakshman added: “The Central Bank is on a monetary policy easing cycle for almost two years now. The subdued growth which prevailed in 2019 was exacerbated by the pandemic in 2020. Warranted monetary policy easing on an unprecedented scale along side fiscal policy support and intervention by the Central Bank with measures such as policy rate reduction and large liquidity injections helped many businesses and individuals to avoid severe hardships.”
“We are beginning to see the impact of bold policy measures reflected in the sharp turnaround in economic activities, favourable developments in employment, improved credit conditions helping the economic revival and faster than expected rebound in a number of high frequency economic endeavors.”
The following are some excerpts from the statement issued by the Central Bank on its monetary policy stance.
“The merchandise trade deficit continued to narrow during January 2021, while preliminary data for February 2021 showed a further reduction in the trade deficit, driven by a larger contraction in expenditure on imports over earnings from exports. Workers’ remittances continued to record a healthy growth thus far in 2021 and this momentum is expected to continue in the remainder of the year. The tourism sector is expected to recover gradually with the opening of the borders along with the successful rollout of vaccinations locally and globally.”
“Meanwhile, the Central Bank and the government continue to engage with investment and lending partners to secure foreign financing and remain committed to honouring foreign currency debt service obligations on time. Although the Sri Lankan rupee experienced some volatility recently, the continuation of the existing restrictions on non-essential imports and certain foreign exchange outflows, among others, is expected to help cushion pressures in the domestic foreign exchange market. Gross official reserves were estimated at US dollars 4.1 billion (excluding the swap facility with the PBOC), with an import cover of 3 months, at end March 2021.”
“Growth of credit extended to the private sector gathered pace in February 2021. This momentum is expected to continue, supported by low lending rates, surplus liquidity in the domestic money market and the expected rise in lending to micro, small, and medium enterprise (MSME) sector. Credit to the public sector, particularly net credit to the government, from the banking system continued to grow, resulting in a notable expansion of domestic credit and an acceleration of broad money growth.”

Business
ADB-funded Thalaiyadi plant serves as blueprint for vulnerable dry zones in Sri Lanka
Sri Lanka should adopt a diversified water-security strategy, says chief engineer
By Sanath Nanayakkare
For generations, the Jaffna Peninsula has relied almost entirely on an underground freshwater lens. With no major perennial rivers to lean on, the region has long walked a tightrope between water scarcity, seasonal droughts, and a creeping groundwater salinity that has challenged communities across the North. Today, however, a monumental shift is underway along the windswept Vadamaradchi coast.
To understand how Sri Lanka is rewriting its water security playbook, one need only look to the Thalaiyadi Seawater Reverse Osmosis (SWRO) Plant.
V. Vijayakanth, Chief Engineer of the Jaffna Kilinochchi Water Supply and Sanitation Project (JKWSSP), recently explained the engineering marvels, environmental safeguards, and long-term vision driving this landmark infrastructure project.
“Building a multi-million-gallon desalination plant on an open, deep-sea coastline facing the Indian Ocean was no small feat,” he said.
Vijayakanth noted that the project required extensive marine, geotechnical, and ecological investigations before a single pipe was laid.
“The scale of the marine installation was striking: an intake and outfall system featuring roughly 1,300 metres of large-diameter pipeline, buried two metres beneath the seabed in water depths reaching up to 12 metres. Because ocean work is strictly dictated by nature, the team had to mobilise an excavator-mounted barge from India and execute a complex offshore operation within a very tight window before the onset of the monsoon.”
“One of the greatest historical hurdles of reverse osmosis technology has been its heavy appetite for electricity. To keep operational costs in check, the Thalaiyady plant integrates state-of-the-art isobaric pressure-exchanger energy recovery systems. These devices capture hydraulic energy from the high-pressure brine reject stream and transfer it directly back to the incoming seawater feed – recovering roughly 95% of available energy and slashing power requirements.”
“Environmental stewardship was equally central to the design. To prevent high-salinity discharge from harming the marine ecosystem, the plant utilizes an offshore outfall equipped with specialized diffusers positioned more than 500 metres from the shore. This ensures rapid mixing within a tightly monitored zone, safeguarding local marine life,” he said.
The impact of the plant is already tangible on the ground. Producing water that meets rigorous national quality standards (SLS 614:2013), the facility feeds into a vast transmission network linked to elevated service reservoirs. These tanks regulate hydraulic pressure across sprawling distribution routes, bringing relief to areas historically plagued by hard, brackish water.
Currently, about 1,600 households in the Karaveddi Zone are actively connected to the desalinated supply, with water flowing across a regional network stretching from Kodikamam and Jaffna City down to distant island communities like Delft, Kayts and Punguduthivu.
The peninsula’s total daily drinking water demand hovers around 50,000 cubic metres for a population of roughly 600,000. Operating at full capacity, the Thalaiyadi plant yields 24,000 cubic metres per day – meeting nearly half of the region’s current needs.
Yet, planners are already looking decades ahead. Driven by economic development, tourism, and proposed industrial zones like Kankesanthurai, projected potable water requirements for domestic, commercial, and industrial needs are expected to climb from 95,000 cubic metres per day in 2025 to 135,000 by 2045, and 175,000 by 2065. Meeting this future trajectory will require a diversified national strategy combining desalination with surface-water preservation and rainwater harvesting.
When asked whether Sri Lanka should lean exclusively on seawater conversion amid intensifying climate volatility, Vijayakanth emphasised the need for a balanced approach: “Sri Lanka should adopt a diversified water-security strategy, prioritising sustainable surface-water development, groundwater protection, rainwater harvesting, water conservation, treated wastewater reuse and catchment protection. Desalination can complement these sources as a valuable climate-resilient and drought-proof option where appropriate.”
Backed by financial and technical collaboration from the Asian Development Bank (ADB), the project has given the National Water Supply and Drainage Board (NWSDB) invaluable expertise in advanced desalination management. Crucially, a two-year hands-on training program is ensuring that local technical staff master everything from membrane upkeep to preventive maintenance.
As climate variability accelerates, Thalaiyadi serves as a vital proof-of-concept. While energy-intensive desalination cannot replace conventional freshwater sources everywhere, Vijayakanth emphasises that it stands as an indispensable, drought-proof shield for Sri Lanka’s vulnerable dry zones – turning the ocean itself into a secure foundation for the nation’s future.
Business
Tropic Of Linen takes new form at The Shoppes at City of Dreams
Sri Lankan fashion label Tropic Of Linen recently opened the doors to its second boutique, located at The Shoppes at City of Dreams.
For over a decade, linen has formed the core of the brand’s inspiration and business ethos. Its textures, movement, and natural irregularities carry through the striking interior of Tropic Of Linen’s newly opened second store. Large sculptural forms in wind-worn sandstone sit against softer curves, while a grand olive tree anchors the heart of the store, reaching up toward a skylight and giving life to the entire space.
Drawing on her background in fine art and design, co-founder Minha Akram envisioned a layered, sensory interior intended to draw people into the world of Tropic Of Linen and invite them to linger.
Business
ANC Education celebrates ‘Class of 2026’ at graduation ceremony in Colombo
ANC Education held its 2026 graduation ceremony at BMICH, Colombo, celebrating graduates across multiple programmes. The cohort included 53 BBA graduates from Northwood University, 22 Psychological Sciences graduates from Northern Arizona University, 320 Pearson BTEC HND graduates, and 29 BTEC Level 7 graduates, alongside foundation, diploma, and transfer pathway students. Senior representatives from partner institutions attended.
Best Performer Awards recognised outstanding academic achievement. The event honoured years of hard work and support from families and educators. Since 2002, ANC has provided local and international pathways. Graduates now pursue careers, further studies, or international opportunities.
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