Features
CEB Seeks 100% Tariff Increase but Blocks 4000 MW of Lower-Cost Renewable Energy Generation: What’s the Logic?
by Anil Cabraal, PhD
Power crisis worsened due to CEB favouring oil and coal power over lower-cost renewable energy
On 27 April 2022, the Renewable Energy Associations announced that 1,251 MW of Non-conventional Renewable Energy (NCRE) plants will have to cease operating, as the CEB owes them Rs.22 billion. NCRE includes mini-hydro, wind, solar, biomass and others that use renewable energy for power generation. The consequences will be severe – greater oil-fired generation, higher oil imports, increased CEB financial losses, depletion of foreign reserves, job losses for NCRE plant employees, default risk to banks holding Rs.60 billion in NCRE debt and NCRE investor losses.
Meanwhile, the CEB has blocked over 4,000 MW of new NCRE plant investments. According to the Auditor General’s 08 February 2022 report, the CEB had rejected signing power purchase agreements for 1,374 NCRE projects with an aggregate capacity of 4,015 MW, which the Sustainable Energy Authority (SEA) had approved from 2017 to 2019 [https://bit.ly/3rYiVPD]. Had these projects been approved by CEB and built, they could have supplied electricity at the prevailing Rs.16.07 to 25.09 per kWh tariff, far less than the cost of diesel electricity today.
On 30 April 2022, CEB Chairman stated that CEB is seeking a 100% tariff increase to pay for staff salaries, fuel imports and other liabilities [https://bit.ly/3s4ZWTv]. While seeking a tariff increase, is it not incumbent on the CEB to make sure they obtain electricity from the lowest cost suppliers?
Tariff update needed to revive NCRE development
Despite the potential for NCRE in Sri Lanka, the NCRE tariff offered by CEB ,under their Small Power Purchase (SPP) Program, has remained unchanged since 2012, thereby depressing the financial viability of such projects. A Cabinet-appointed Committee recommended a new NCRE tariff regime in December 2021 to the responsible State Minister. To update the tariffs to today’s economic reality, the author recalculated the tariffs using 2022 parameters for four sample NCRE technologies, using the 2012 PUCSL-approved methodology. For new NCRE power plants, Table 1 shows a comparison of the prevailing 2012 tariff, the 2021 Tariff Committee’s proposed tariff, and the author’s 2022 tariff for mini-hydro, solar, wind and biomass dendro (sustainably harvested biomass).
Table Comparison of NCRE 2022 Tariff with Prevailing 2012 Tariff and Tariff Committee’s Proposed 2021 Tariff
Notably, the Tariff Committee’s proposed 2021 NCRE tariff is lower than the prevailing 2012 tariff, despite exchange rate and other factors deteriorating from 2012 to 2021. On a positive note, US dollar investment costs of solar and wind technologies did decline significantly. NCRE which are financially nonviable in 2022 at the prevailing 2012 tariff, will be worse off under the 2021 tariff.
The severe economic shocks of 2022 are the principal reasons why the calculated 2022 tariffs are higher. Calculated higher tariffs in 2022 are due to: (a) The sharp rupee depreciation which makes investments costlier in rupee terms, as 70-80% of NCRE investment is foreign content. However, unlike oil or coal-powered generation, NCRE generation is immune to imported fuel rupee-price increases; (b) Credit has become more expensive. Even the author’s assumption of 18% interest rate may be too low. (2021 Tariff Committee assumed 9.85% interest). The one-year T-Bill rate is now more than 25%; (c) Inflation is higher; and (d) In the case of biomass-fuelled generation, fuelwood prices have risen sharply due to oil and LPG shortages and their price increases.
While the 2022 tariff may seem high, they are less costly than electricity from oil and coal today, as discussed below.

Is NCRE investment in 2022 worthwhile at these higher tariffs?
The answer is a Yes, as illustrated in Figure 1 which compares the flat (“levelized”) electricity cost, from NCRE, coal and oil under various conditions. Conservatively, the analysis assumed more favourable financing terms for CEB-owned coal and oil power plant investments, than for private sector NCRE or emergency diesel (Diesel IPP) investments.
NCRE electricity is cheaper than that from new oil-fired generation, even from efficient combined cycle plants. At today’s coal prices, NCRE electricity costs can be less than that from a new coal plant. The results are unsurprising as, once built, currency depreciation only marginally affects NCRE plants, unlike oil and coal plant operations. NCRE potential is very high in Sri Lanka.
Figure Comparison of Levelized Electricity Cost of NCRE, Oil and Coal Power Generation
What are the savings to CEB and to Sri Lanka from unblocking NCRE Investments?
The savings can be considerable to CEB by avoiding paying for higher cost electricity, and to the Nation from reduced fuel imports. As an example, implementing 800 MW (or 20% of the blocked projects) could supply about 1,800 GWh of NCRE electricity annually. In comparison, in 2020, oil thermal IPPs supplied 2,717 GWh of electricity and CEB oil thermals generated 1,462 GWh. Therefore 1,800 GWh of NCRE electricity could displace more expensive oil thermal generation, especially the more expensive IPP diesel generation. CEB may, however, need to upgrade its system control and operations to accommodate increased generation from variable solar and wind power.
The 800 MW of NCRE generation could offset about 400 million litres of diesel fuel annually. The net financial savings to CEB is Rs.37 billion per year (assumes paying flat 2022 tariff for NCRE, while avoiding paying for diesel fuel at US$0.75/litre, the price CEB paid for 40,000 MT in April 2022). The saving to Sri Lanka by avoiding diesel imports is about US$300 million for the year from these 800 MW of NCRE investments. The NCRE investment required is about US$1,000 million, giving a simple payback of 3.3 years in imported diesel fuel savings.
Special case of existing biomass power plants
Even if CEB pays the outstanding invoices for NCRE-supplied electricity, the existing biomass power plants (37 MW) are presently facing an existential threat to their financial survival due to the sharp rise in fuelwood prices (from about Rs.7/kg to Rs.12/kg for chipped fuelwood in 2022). Unless the Cabinet takes mitigatory actions immediately and approves an amendment to the existing Biomass Dendro Power Purchase Agreement to permit a higher tariff, these plants will cease operations and Sri Lanka will lose access to these 37 MW. Even at a fuelwood price of Rs.12/kg, electricity from these existing plants is far cheaper than CEB paying for diesel fuel. Paradoxically, unlike these biomass plants, oil-fired IPPs can pass-through the fuel cost to CEB and avoid the fuel price risk.
What must the Government and CEB do?
Given the significant benefits from investments in NCRE, the Government must direct the Ministry of Power and Energy, CEB, PUCSL and SEA to immediately undertake the following:
* Most urgently, CEB must settle its arrears of Rs.22 billion to NCRE producers.
*Tariff Committee must update the NCRE cost-reflective tariffs to 2022 conditions in consultation with technology and project finance specialists.
*PUCSL must approve, and CEB must adopt the tariff as soon as possible. The CEB and PUCSL must commit to updating the tariffs at least every 2 years.
*CEB must commit to accepting over 1,000 NCRE projects that they have hitherto blocked and invite other NCRE proposals.
*SEA should invite companies to revise feasibility studies and update their NCRE applications. Companies must respond quickly. SEA should, without delays or additional fees, review and approve the compliant proposals.
*CEB must issue letters of intent and sign Power Purchase Agreements without delay for compliant NCRE proposals.
*CEB must commit to providing necessary infrastructure and control systems upgrades required to connect these NCRE facilities to the CEB grid.
*SEA, with Ministry of Finance assistance, could mobilize financing from commercial banks and international financiers, particularly climate-friendly investors.
As Mr. Manjula Perera, CEO of Windforce Ltd., representing the renewable energy community, stated recently: “If the Power Ministry, CEB, SEA, and PUCSL work hand in hand and get the necessary policies in place, adding 1,000 MWs from NCRE within the next 2 years by local RE developers will not be a challenge”.
In conclusion, successfully accomplishing these actions will permit NCRE technologies and the private sector to help Sri Lanka address its near-term energy-sector and balance of payment challenges and to achieve the Government’s goal of 70% RE generation by 2030.
03 May 2022
Disclaimer: The views, data, assumptions, analyses, results interpretations, and opinions expressed in the text belong solely to the author, and not necessarily to any other group or individual, including those cited in the article.
The author is a former Lead Energy Specialist at the World Bank with specialization in renewable energy project development and financing in Asian and African countries, including in Sri Lanka. This article is based on his paper “Mobilizing Renewable Energy to Overcome the Energy and Financial Crisis: The Need for a Credible Renewable Electricity Tariff,” https://bit.ly/3Ltabsx
Features
Why ‘Southasianness’ should continue to matter for the ‘SAARC Eight’
At a time when Sri Lanka’s foreign policy is coming under intense scrutiny by some local sections it is only right that impartial and independent commentators shed some clarity on what fundamental foreign policy directions Sri Lanka ought to take. The extremely fluid and complex nature of current international politics renders such an understanding crucially important.
Given its vulnerabilities in a number of spheres Sri Lanka has no choice but to persist in broadly following the path of Non-alignment. That is, it should be ‘a friend of all and an enemy of none’, to the extent possible. However, it does not follow that in the process it could compromise what is seen as its national interest.
The latter point needs stressing against the backdrop of the criticisms the Sri Lankan government has been attracting from some quarters over what is made out to be some opaqueness in security and defence cooperation agreements it has entered into with India. It remains advisable for the Sri Lankan government to enter into pacts of this nature with India, but the government is obliged to disclose the contents of these agreements to the Sri Lankan people without undue delay in consideration of the uncompromisable sovereign rights of a people in a democracy.
However, there is no denying that the government should make it a central foreign policy premise to always work in cooperation with India. A consideration of what it cost Sri Lanka in the past to be in a disharmonious relationship with India and how such policy missteps worked against Sri Lanka’s best interests ought to dictate to Sri Lanka the advisability of maintaining uninterrupted cordial ties with India. Moreover, common sense ought to drive home to a country the costs of being at loggerheads with one’s closest neighbour who has also proved a ‘ready friend in deed.’
That said, it is the bounden duty of Sri Lanka’s diplomatic community or establishment to ensure that such cooperation does not degenerate into a policy of subservience towards India. That is, finesse and farsightedness in local diplomacy become prime requirements.
While India’s geographical location and physical size, besides her other strengths, contribute towards her centrality in regional and world affairs, her neighbours would be thinking and acting far-sightedly if they not only focus on India and her legitimate interests but also ensure continuous friction-free intra-South Asian relations. That is, for them collective South Asian well being should be of fundamental importance.
Much more than for India perhaps, such harmonious ties are of inestimable importance to India’s neigbours who are up against multiple vulnerabilities which are to a great extent regionally rooted. The latter could never, that is, afford to take their minds off the region’s collective development prospects.
The above are some of the reasons why it could prove highly counter-productive and self-defeating for the ‘South Asian Eight’ to render dormant and ineffective the historic SAARC organization. Rather than ‘dead’ SAARC has been allowed to drift into the ‘Limbo of Forgotten Things.’
The growing inter-dependence of the ‘SAARC Eight’ ought to impress on the collectivity the need to step-up regional cooperation in multiple areas which impinge on its members’ legitimate interests. For instance, the youth-led ‘Cockroach’ revolts, first in India and subsequently outside, should convince South Asia that it is continuing to be plagued in a major way by poverty and equity-linked issues. That is, West-inspired, largely market economics-dictated ways to see an end to poverty are simply not working completely.
Likewise climate-related questions are ravaging South Asia in unimaginable ways; Nepal being just one case in point. The rationale for regional cooperation remains valid and undefeated. It is time for revived and stepped-up SAARC cooperation. That is, the solutions to the region’s development dilemmas need to be found in mainly the region.
This amounts to making a case for a continued sense of ‘Southasianness’ among the SAARC countries. That is the conviction should be firm that they know their developmental challenges best and that answers to these issues must be primarily evolved by the grouping itself in cooperation with concerned sections.
From the above viewpoints the Regional Centre for Strategic Studies (RCSS), Colombo did very well to tie-up with the South Asian University (SAU), India, to increase public awareness on the developmental problems affecting South Asia and for initiating a number collaborative measures that aim at ameliorating them. The relevant agreement was formalized in early September at the RCSS. The sealing of the pact took place under the aegis of SAU President Prof. K.K. Aggarwal and RCSS Executive Director Ambassador Ravinatha Aryasinha.
A press release issued by the organizations said the collaboration aims ‘to foster research networks, partnerships and collaborations for transformative change across South Asia.’ It also mentioned that the partnership marked the first agreement to be signed by SAU with an independent think tank in Sri Lanka.
Among other things, pacts such as the above are bold moves in the direction of fostering a spirit of intellectual independence in those areas of the South facing some of the stiffest developmental challenges. Rather than ‘import’ solutions to these challenges from outside the region, the SAU-RCSS initiative aims at fostering fresh approaches to evolving solutions to problems that are uniquely South Asian.
It is hoped that the SAU and RCSS initiative while leading a to a greater degree of Southern intellectual independence in the area of development thinking would also help in kick-starting the SAARC process all over again in a major way.
What ought to lend fresh urgency to the latter undertakings are fast-breaking current developments in international politics. It ought to be perceived by the most underdeveloped regions of the South that going forward their well being would matter least or not at all to the major powers of both East and West.
For example at the time of writing the foremost among US and Chinese political leaders are meeting in the US in what is made out to be a historic coming together of sorts to address issues of common concern. It is highly unlikely that the parties would be addressing the economic preoccupations of the least developed countries. The same goes for other states that matter from the East and West.
Essentially, the US and China would be looking at ways of strengthening business ties that matter majorly for them. The South and its issues would prove to be of peripheral interest, if at all they happen to matter to the protagonists. Such developments ought to be fresh reminders to the South and their collaborative organizations that there is no escaping self-help and joint solidarity.
Features
Is Sri Lanka prepared for global literacy crisis?
by Prof. M.W. Amarasiri de Silva
Adult literacy has for a long time been one of Sri Lanka’s greatest sources of pride, serving as a social indicator that has set the country apart from several of its neighbours in the region. For many years Sri Lanka has been recognised for keeping its literacy rates at a level like those of middle-income countries and even some high-income ones, even though it has faced economic difficulties and political instability. However, since new global research has now shown an unexpected and concerning decline in adult literacy in several high-income countries, it is important to consider what this means for Sri Lanka.
The phenomenon described by Jishnu Das, Yash Dhuldhoya and Ethan Sager, the unexplained fall in functional literacy among adults in wealthy nations. calls for a more thorough examination of the nature of literacy, the pressures exerted by the modern information environment, and the vulnerabilities that Sri Lanka might encounter as it moves towards a more digital, ageing and complex society. Even though Sri Lanka’s basic literacy rates remain high and steady, the global trend acts as a warning that literacy is not a fixed accomplishment but a dynamic capability which must be continually fostered, safeguarded and adapted to changing circumstances.
Decline in functional literacy
The drop in literacy rate in high-income countries is not due to people losing the ability to read or write in the ordinary way. On the contrary, it reflects a decline in functional literacy, which is the capacity to deal with, understand, and apply information in real-life situations. This kind of literacy involves following instructions, comprehending official documents, using digital interfaces, interpreting medical information, and making sense of complicated texts that demand continuous attention.
Researchers stress that the decline cannot be attributed merely to disruptions caused by COVID-19 or the increasing use of smartphones; instead, there is going on something more fundamental: a weakening of the cognitive and informational bases that adults need to function properly in modern society. In countries such as the United States, the percentage of adults regarded as functionally illiterate has increased significantly, indicating that even highly educated societies are having difficulty in keeping up the skills required to handle ever more complex streams of information.
Sri Lanka immune?
At first sight, Sri Lanka seems to be immune from this trend. The country’s adult literacy rate is still above 92 per cent and youth literacy is even higher. According to the 2024 Census, literacy rates exceed 97 per cent among people aged ten and over, with nearly equal levels between the sexes. These figures show the continued strength of Sri Lanka’s system of free education, a system which in the past has guaranteed widespread access to school and has produced generation after generation of citizens who could read and write at a basic level.
There has also been a steady improvement in educational attainment, with an increasing number of adults finishing secondary education and a larger proportion going on to tertiary institutions. Unlike the mysterious drops observed in rich countries, Sri Lanka’s literacy figures demonstrate stability and even a slight improvement.
However, although the surface appearance is reassuring, an even more complicated reality exists. The literacy figures for Sri Lanka only record basic literacy, that is, the ability to read and write simple sentences, and they do not include measures of functional literacy. It is impossible to tell from these statistics whether adults can interpret a bank statement, understand a medical prescription, use an online government portal, or critically assess information that is spreading on social media. As is shown by the global trend, having a high level of basic literacy does not ensure a strong degree of functional literacy. On the contrary, functional literacy can fall even if basic literacy stays the same. This difference is important for Sri Lanka, particularly since the country is currently experiencing rapid digitalization, demographic ageing, and social change.
Major risk factor
A major risk factor is the move towards digital information environments. In high-income countries, researchers believe that the prevalence of smartphones and short-form digital content may be diminishing people’s ability to engage in deep reading. Nowadays, individuals take in information in short, rapid segments by scrolling through social media feeds, quickly reading headlines, and viewing short videos. Such behaviour decreases the opportunity for sustained reading, which is necessary for keeping comprehension, critical thinking, and the capacity to deal with complex information intact.
Sri Lanka is going through a comparable change. There has been a sharp increase in the number of people using smartphones, and social media sites have become the main sources of news, leisure, and communication. Although there are many advantages to having digital access, it also results in a situation where superficial reading becomes the standard approach and could therefore lead to a decline in functional literacy over time.
Demographic ageing as challenge
A further challenge that is coming up is demographic ageing. Sri Lanka is rapidly moving towards becoming an ageing society, with an increasing number of older people who might experience cognitive decline, have less exposure to new information, and enjoy few opportunities for further learning. In high-income countries, ageing populations have led to a fall in functional literacy since older individuals have had difficulty adapting to digital systems and complicated bureaucratic procedures.
The older generation in Sri Lanka, many whom were educated many decades ago under different curriculum standards, could end up becoming increasingly vulnerable in a world in which essential services, such as banking and healthcare, are being moved online. If appropriate support is not provided, the country may witness a growing gap between basic literacy and functional literacy among older adults.
In Sri Lanka, the way in which administration and the workplace are organised has in the past placed greater trust in personal communication and on basic forms of documentation. What in high-income countries would require complex reading is instead carried out through face-to-face contact in Sri Lanka. Nevertheless, this situation is now changing. Government services are becoming available online, banks are introducing digital systems, and in workplaces there is an increasing need for employees to use electronic systems. Since these changes are happening at a faster rate, the demand for functional literacy will increase. Should adults not be able to meet these new demands, Sri Lanka might start to see the kind of decline in literacy that has been seen in other places.
Misinformation and disinformation
Another worry is the spread of misinformation and disinformation. In Sri Lanka, there has already been the quick dissemination of false information via social media, with this having an impact on public health, politics, and social cohesion. Since functional literacy is essential for allowing people to assess sources, doubt the claims made, and tell the difference between reliable information and falsehoods, a lack of functional literacy causes societies to be more open to manipulation, polarisation, and confusion.
The fact that there has been a global drop in functional literacy at the same time as misinformation has increased points to a dangerous feedback cycle: when literacy is low people become more prone to misinformation, and the misinformation in turn damages their ability to think critically about information. Given that the country has a high level of social media use and a lack of digital literacy training, Sri Lanka should take this risk seriously.
Even though there are these risks, Sri Lanka has several advantages which can assist in avoiding a drop in functional literacy. The country’s system of basic education is still strong, showing high enrolment figures and good results in basic literacy.
Families in Sri Lanka still place a great deal of importance on education and reading is still a respected cultural activity. Furthermore, because of its relatively small size and the fact that it has a centralized form of government, it is more efficient than in bigger countries to carry out nationwide literacy campaigns. These strengths offer a firm basis for developing new strategies for protecting and improving functional literacy.
Literacy a process
It should be realised by Sri Lanka that attaining literacy is not a single accomplishment achieved in childhood. In the modern world, literacy must be a skill that is constantly put into practice, kept up to date and adapted to changing circumstances. The fact that adult literacy is declining worldwide shows that even in wealthy countries with well-developed education systems deterioration can occur if adults are not supported in keeping their cognitive and informational abilities. Sri Lanka cannot afford to be careless.
It is necessary for the country to invest in adult education, in programmes concerning digital literacy and in the development of cognitive skills for all age groups. It also needs to establish ways of measuring functional literacy rather than just basic literacy so that policymakers can detect emerging weaknesses and act in advance.
A vital measure is to increase the opportunities for adult learning. Although Sri Lanka has effective literacy programmes based in schools, the country’s infrastructure for adult education is limited. Community centres, libraries, universities, and vocational institutes should take on a more significant role by providing courses, workshops, and reading programmes which are tailored for adults. The programmes should place an emphasis not just on reading and writing but also on digital navigation, critical thinking, and information processing. Adults should be given the chance to practise the skills that are necessary for them to function effectively in a rapidly changing world.
Importance of digital literacy programmes
It is just as important to have digital literacy programmes. Since an increasing number of services are being offered online, adults need to learn how to use digital tools with confidence and in a safe manner. This involves knowing how to fill out online forms, moving around on government websites, using banking apps, and being able to spot misinformation. The digital literacy courses available should be accessible, affordable, and adapted to different age groups, especially older adults who might feel put off by technology. Schools can also contribute by incorporating digital literacy into their curriculum so that future generations acquire good functional literacy skills from an early age.
Sri Lanka should also investigate introducing policies which promote cognitive health among older people. Since cognitive decline can lead to a deterioration of functional literacy, it becomes more difficult for older individuals to deal with information. It is possible to help keep cognitive function by setting up programmes that promote reading, social interaction, physical activity, and continued learning. During regular medical visits, healthcare professionals should include cognitive assessments so that any problems affecting literacy-related skills can be picked up early.
Sri Lanka needs to create tools for measuring functional literacy, since the figures available on basic literacy give an incomplete account of the country’s capabilities. By using assessments of functional literacy like those employed in high-income countries, Sri Lanka would be able to monitor how well its adults can apply their literacy skills in real-life situations.
Features
From Colombo to Vegas: Sri Lankan talent shines at WCOPA
The World Championships of Performing Arts (WCOPA) is known globally as the Olympics of performing arts, but Sri Lankans came to know of it more closely when Natharie Wickramasinghe, representing Team Sri Lanka at WCOPA 2026, in Las Vegas, earned a Bronze Medal in the Ethnic/Folklore Dance category.
Behind Sri Lanka’s WCOPA journey is Sri Lanka-born Chris Rajendra, who migrated to the United States in 2007, and deserves special congratulations.
Passionate about discovering and promoting talent, Chris has been actively involved in the pageant and performing arts, industry since 2002.
A major milestone came in 2015, when he introduced WCOPA, to Sri Lanka, for the first time, creating an international platform for Sri Lankan performers.
Sachini Ayendra became the very first candidate to represent Sri Lanka at WCOPA, in 2015, marking the beginning of Team Sri Lanka’s journey.
Chris served as National Director for Team Sri Lanka from 2015 to 2018, and has returned to the role for the 2026–2027 term, continuing his commitment to identifying, developing and promoting Sri Lankan talent internationally.
His involvement in pageantry and performing arts includes:
Recruiter, Miss Nevada United States – 2014

Chris Rajendra: National Director – WCOPA Team Sri Lanka
Manager, Miss Colombia Las Vegas – 2013 to 2017
Director for the West Coast and International Divisions of Ms. Latina International and Ms. International World – 2017
National Director for Team Sri Lanka – WCOPA, 2015–2018 and 2026–2027
Co-National Director for Team USA – WCOPA 2026
In the USA, Chris began his career in retail before transitioning into insurance and financial services, where he built extensive experience in sales, marketing, leadership and business development.
He owned and operated a brokerage, affiliated with multiple insurance companies, and later served as Marketing Director with Transamerica and World Financial Group.
As his business expanded across Las Vegas and California, he continued to hone his expertise in sales, marketing and client relations. He now works as a Sales Executive at Hilton Grand Vacations.
Looking ahead, Chris will shortly launch the application process for Team Sri Lanka 2027, giving talented Sri Lankan performers another opportunity to represent the country on the world stage.
The 2027 World Championships of Performing Arts will take place in Las Vegas, USA, in July or August 2027.
Through his work in both the corporate and performing arts worlds, Chris Rajendra continues to combine leadership, networking and talent development — creating opportunities for Sri Lankan performers to showcase their abilities on a global platform.
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