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CBSL: Debt servicing won’t lead to huge depreciation of rupee

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By Rathindra Kuruwita

It is unlikely that the rupee will significantly depreciate following the recommencement of bilateral and commercial debt servicing, says Director of the Central Bank Economic Research Department, Dr. P. K. G. Harischandra.

Dr. Harischandra said so when he was asked by journalists yesterday whether the rupee would depreciate significantly when the country resumed the repayment of bilateral and commercial debt. He said that Sri Lanka had continued to service the debt from multilateral organisations.

“We won’t have to pay bilateral and commercial loans immediately. There will be a grace period due to debt restructuring,” he said.

Dr. Harischandra said Sri Lanka would receive funds from the IMF, the World Bank and the Asian Development Bank.

“There is no reason why we can’t manage debt restructuring,” he said.

Commenting on speculations that there would be sharp exchange rate fluctuations, Dr. Harischandra said there was also no reason to expect large fluctuations in the exchange rate in the future. Undue speculations might just hurt market players, he said.

“There have been slight ups and downs in recent months. In 2022, the rupee depreciated by over 45 percent. Such sharp fluctuations of course affect inflation. However, slight fluctuations don’t really affect inflation. If you look at inflation between 2009 and 2020, it was in single digits, but there was noticeable depreciation during that time. There is a trade gap of about 400 million U.S. dollars a month. But we get about 485 million dollars a month by way of remittances. We also get a substantial amount from tourism. There isn’t a lot of pressure from the trade gap,” he said.

Dr. Harischandra said that inflation would drop further in August and would stabilise.



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JSA opposes move to extend retirement ages of superior court judges

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Dr. Rajitha Senaratne

The Judicial Service Association (JSA), which represents the country’s magistrates and district judges, has unanimously adopted a resolution opposing the government’s proposed extension of the retirement age of superior court judges.

The resolution was passed at a special general meeting held at the Kaduwela Magistrate’s Court premises, attended by 65 magistrates and district judges from across the country.

The meeting was convened following the resignation of JSA President Pasan Amarasena, who stepped down in protest over the holding of the meeting.

According to the resolution, all members present voted in favour of opposing the proposed extension of the retirement age of Supreme Court and Court of Appeal judges.

Amarasena resigned after facing criticism for unilaterally expressing support for extending the retirement age of the Chief Justice. Following his resignation, JSA Secretary Suranga Munasinghe issued a statement to members rejecting the allegations contained in Amarasena’s resignation letter.

Meanwhile, former Health Minister Dr. Rajitha Senaratne claimed the government’s attempt to extend the tenure of superior court judges was aimed at securing their support in pursuing what he described as a campaign of political revenge against Opposition members.

Addressing a meeting at the Sri Lanka Freedom Party headquarters on Darley Road, Colombo, Senaratne argued that if the government’s justification was to retain experienced judges and avoid vacancies, similar retirement age extensions should also be granted to other professions, including university academics.

“The judges themselves have now unanimously opposed the government’s move, as reflected in the outcome of the Judicial Service Association’s special general meeting at Kaduwela,” he said.

by Chaminda Silva

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Next two weeks critical as dengue risk soars

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Mosquito larvae density in Sri Lanka’s Western Province has increased significantly, making the next two weeks an extremely high-risk period for dengue transmission, according to Consultant Physician Dr. Ananda Wijewickrama, a member of the Expert Committee on Dengue Management.

Speaking during a television programme, Dr. Wijewickrama warned that based on the current trend of dengue transmission, the situation could become more serious than the country’s 2017 dengue outbreak.

He said hospitals in the Western Province have already exceeded their capacity due to the sharp increase in patient admissions, with some facilities being forced to accommodate two or even three patients in a single hospital bed.

Also speaking during the programme, Prof. Neelika Malavige of the University of Sri Jayewardenepura said early signs of the current outbreak had been visible as far back as December and January.

“We could already see indications of this in December and January. With the current changes, the trend is not encouraging. We usually see an increase in dengue cases during the Southwest Monsoon period from May to July, and again during the Northeast Monsoon from November to January. When such conditions are expected, we need to be prepared in advance. After that, from February to April, we experienced extremely high temperatures, and mosquito breeding tends to slow down during periods of excessive heat,” she said.

Professor Malavige also noted that three dengue vaccines have been approved in various countries and are currently being used in several Asian nations, including Indonesia, the Philippines, Thailand, Vietnam and Malaysia.

“However, there are many factors Sri Lanka would need to consider before introducing a dengue vaccine. It would not have an immediate impact on reducing an epidemic. The vaccine requires two doses, and it takes time for immunity to develop after vaccination. However, for people who have previously been infected with dengue, the vaccine has shown very good effectiveness,” she said.

Sri Lanka has so far reported 66,064 dengue cases this year, while the death toll has risen to 46.

A total of 10,685 cases were reported during the first nine days of July alone, including 1,030 new infections reported yesterday.

Of the total number of cases, 52.7% have been reported from the Western Province. Gampaha District has now overtaken Colombo District as the area recording the highest number of dengue infections.

Meanwhile, amid the heightened risk, special dengue control operations involving members of the armed forces were carried out today in several parts of the country.

by Pradeep Prasanna Samarakoon

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Budget 2027 on Nov. 12

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The second reading of the 2027 Appropriation Bill will be presented in Parliament on November 12, the Ministry of Finance announced.

The Ministry said the Bill will be published in the Government Gazette on September 18 and presented for its first reading in Parliament on October 7.

The draft Appropriation Bill for 2027, which sets out the proposed expenditure allocations for each Ministry, is scheduled to be submitted to the Cabinet for approval on September 14.

According to the Ministry, the second reading debate on the Budget will be held from November 13 to 20, while the Committee Stage debate is scheduled from November 21 to December 14.

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