Midweek Review

Crisis choices: Economic fundamentalism or economic realism?

Published

4 years ago

2022/01/5

By DR. DAYAN JAYATILLEKA

Economics is not a hard science. There are no scientific axioms in economics that can be universally accepted. It all depends upon the economic paradigm or episteme one operates with and within.

Economic policy is a matter of choices. There is no one, single, correct answer that is self-evident. It all depends on where you are coming from and want to get to.

Unlike in the case of hard science, where the correct methodology applied to the data points you in a certain direction, in the case of economic policy the choices you make can take you into the minefield of civil war.

UNP-NOMICS, POHOTTU-NOMICS, JVP-NOMICS

In economics, the dogmatic rightwing liberal school of economic thought has never figured out what happened to the periods of Ceylonese/Sri Lankan history they applaud and approved of:

1. The UNP of the 1950s, which ended with the hartal of August 1953 and Sinhala Only 1956

2. The UNP of 1965-1970 which ended with the rise of the armed JVP and a two-thirds majority for the SLFP-led coalition;

3. The UNP of 1977-1988 which led to a massive Southern insurrection and the near-decapitation of the UNP (and had to be rescued by Premadasa through a shift to a very different economic paradigm);

4. The UNP of 2001-4 which ended with the Presidential ouster of the PM and the electoral victory for Mahinda Rajapaksa;

5. The UNP of 2015-2020, which ended with the electoral extinction of the UNP.

This is why I do not trust for a moment, the prescriptions of those who belong to that same school of economic thought and have made no public criticism of and rupture with the policies of those times.

When these successive experiments have ended in sociopolitical backlashes, it would be suicidal to approach the same doctors for the same diagnoses and prescriptions.

Sri Lanka has experienced twin disasters:

(A) Statist closed economy/low growth (SLFP 1970-1977, SLPP 2019-) and

(B) Open economy/rapid growth/trickle-down/free-market fundamentalism (UNP)

The JVP-NPP’s discourse and printed proposals so far, take as a starting point the denunciation and rejection of the Open Economy of 1977. That alone tells us that they cannot offer a solution to the present crisis or a better future for Sri Lanka. the JVP’s rejection of the Open economy instead of a progressive reform OF the Open Economy will lead us to the kind of abyss that has given socialism a bad name as an economic system.

Thus, three options we are offered, namely the current regime’s policy which is a throwback to that of Sirimavo Bandaranaike -NM Perera, the Ranilist UNP’s economic policy –summed up in the ‘IMF First!’ approach—and the JVP’s rejection of the Open economy, are all disastrous.

PROGRESSIVE PRAGMATISM

Based upon empirical evidence, it is only the paradigm of President Premadasa that gave us high growth including rapid industrialization, high inflows of foreign investment, a lively stock market and zero-socioeconomic polarization/backlash, because it also witnessed rapid decline in inequality. I do not trust anyone who fails to recognize that fact.

That is also why I insist that any discussion of ‘exits’ from the crisis and an economic strategy for Sri Lanka’s future, takes as a start-line, the economic paradigm and policies of President Premadasa.

It is only that combination of ‘growth with equity’; of state-led social and economic intervention and an Open Economy, that can avoid social instability and ensure a better future. That is what Sri Lankan Social Democracy looks like.

Thanks to the Rajapaksa regime’s policies we are poised on a volcano. The wrong policy prescription will make the coming explosion far worse than it needs to be. The problem is not the IMF as such. The problem is the austerity programme that will be presented as a solution either by the IMF or this Government or its successor.

This country has seen far too much turmoil and bloodshed, and I have been in and around too much of it, that I tend to fight against anything that would cause more of it.

In the context of a grave and deepening economic crisis, if we are to avoid further social and political polarization, the political leaders and policy-makers, current and aspirant, must look for the Middle Path or Golden Mean, because this provides and has almost always provided the best solution.

The economic paradigm of John Maynard Keynes is an excellent example of a middle path between free-market capitalism and state-controlled communism. Keynesianism was the animating spirit of the Beveridge plan and the welfare state erected by the Labour government of postwar Britain.

If we move into the realm of economic reform at times of grave crises we have President Roosevelt’s New Deal, which was a middle path between unreconstructed capitalism and Marxist socialism. While many countries were succumbing to the lures of either Fascism or Communism, the Rooseveltian New Deal saved US democracy from being rent by civil conflict and class struggle during the great depression.

If anyone thinks that these are old-fashioned ideas, I would suggest he/she reads the writings of Nobel prize winner Joseph Stiglitz and Paul Krugman, not to mention Jeffrey Sachs and Robert Reich. In the USA today, the economics of President Joe Biden represents, in his own words, a return to the philosophy of Roosevelt’s New Deal.

How has the Middle Path in economics and especially in the context of economic crisis, worked in Sri Lanka? At a time of devastation through civil wars and interventions, Presidential candidate Ranasinghe Premadasa deliberately struck a neo-Rooseveltian chord, entitling his 1988 election manifesto “A New Vision and A New Deal.” In his policy practice he eschewed the twin extremes of, on the one hand, the establishment thinking of rapid growth which awaits ‘trickle-down’, and on the other hand, and on the other, the crassly egalitarian socialism that the JVP stood for.

The Premadasa paradigm was of growth with equity, which succeeded in reviving growth rapidly, attracting foreign investment, rejuvenating the stock market while simultaneously—not sequentially—reducing inequality through a plethora of programmes such as Janasaviya, free school uniforms, free mid-day meal, etc.

In a recent speech on the ongoing economic crisis, Prof Howard Nicholas of the ISS at the Hague, and the University of Rotterdam, emphasized that industrialization was the only solution, and pointed to President Premadasa as the only leader who actually embarked successfully on that path.

Premadasa consistently took a Middle Path and did so creatively. In 1992, he addressed the problem of loss-making plantations neither by maintaining the status-quo nor by selling the plantations to foreign corporates as President CBK did in 1995. Instead, Premadasa granted five-year renewable management contracts to Sri Lankan private companies.

Another example of the Middle Path in economics is that of East Asia, namely Japan, China, South Korea and ASEAN, most notably Vietnam. Theirs was not the path of relying excessively on the free-market to work its magic, as in the West. The role of the state is much greater in the East Asian model than in the neoliberal one. Therefore, the formulae of Lankan neoliberals, to slash state expenditure, has to be looked at more closely and with greater discrimination.

At a moment when the JVP’s Anura Kumara Dissanayake and the FSP’s Pubudu Jagoda and Duminda Nagamuwa have attacked the IMF as a solution, and given that these parties drive a powerful union movement, I renew my call for an Economic Roundtable to arrive through consultation at a broad consensus, based on mutual trade-offs, so as to manage the economic crisis.

The country must go to the IMF only having agreed on the parameters and red-lines as pertains to austerity measures which will impact upon the working people and the poor.

Where should the cutbacks be? Where should they land? Those are choices. Who will make them and for what reasons? To put it bluntly, who should carry the burden of the crisis and the so-called solution? Is it the 99% of the citizenry or the 1%?

There are no axiomatic solutions. Take the issue of State-Owned Enterprises. From the neoliberal right to the regime’s tough Ministers such as Dilum Amunugama, there is an advocacy of privatisation, but is this the only solution? The unions can help identify where the cuts can come.

Any attempt at slashing public expenditure without consultation and the coming storm will turn into a tornado. This in turn could provide the opportunity for the installation of military rule.

Social Democracy is a Middle Path between Right and Left, consisting of a synthesis of ideas of Right and Left.

To sum up, I would use the markers ‘Keynes’, ‘Roosevelt’, ‘Social Democracy’, ‘East Asian model’ and ‘Premadasa’ to demarcate the third space in economics and economic policy; the Middle Path which Sri Lanka should follow.

The Middle Path or Golden Mean is the only approach that will get the citizenry on board the adjustments that are necessary in the context of this crisis. It is a Middle Path between what the minimum that economic policy planners, local or foreign, propose as imperative reforms, and the maximum that the citizens, starting with the working people and the poor, are willing to accept. No economy reforms deemed as fundamental by policy wonks, will be implementable without the consent of the citizens. That consent has to be obtained by the willingness of policy-makers to come halfway.

What the economic fundamentalists utterly fail to realize is that for any policy package or measure to work, the people, starting with those are directly affected, are willing to co-own those reforms. They will do so only if they have been consulted and have participated in the design of policy. Once they feel they co-own the policy they will participate with some degree of voluntary discipline.

A leader with the track record of the most spectacular development success in rapid growth with simultaneous equity, explained the fundamental approach with the following words:

“We as a government cannot claim credit for this. It was and is a people’s effort. We mobilised. We assisted. But it was …the people who participated with unprecedented commitment. Why is that? Why are the people so keen to participate? The answer is very simple. It is because they are consulted. It is because they are involved. It is because they benefit directly.”

(President Premadasa’s, Speech at Gam Udawa 91 exhibition, Kamburupitiya, July 23rd 1991)

Contrary to the approach of neoliberal economic fundamentalists, those are the three practical criteria that any successful economic policy programme must meet: Are the people consulted? Are they involved? Do they benefit directly? These are the criteria that any programme of adjustment and stabilisation, be it by the IMF or the Government – this one or its successor—must meet if a sociopolitical explosion is not to result.

All News Advertisement

Midweek Review

2019 Easter Sunday carnage in retrospect

Published

6 days ago

2026/04/8

Sahan Weerasooriya

November 21, 2019: President Gotabaya Rajapaksa meets Archbishop of Colombo, His Eminence Malcolm Cardinal Ranjith at the Bishop House where he requested the Church to nominate a representative for the Presidential Commission of Inquiry (PCoI) probing the Easter Sunday carnage.

Coordinated suicide attacks targeted three churches—St. Anthony’s in Colombo, St. Sebastian’s at Katuwapitiya and Zion Church in Batticaloa—along with popular tourist hotels Shangri-La, Kingsbury, and Cinnamon Grand. No less a person than His Eminence Archbishop of Colombo Rt. Rev. Malcolm Cardinal Ranjith is on record as having said that the carnage could have been averted if the Yahapalana government shared the available Indian intelligence warning with him. Yahapalana Minister Harin Fernando publicly admitted that his family was aware of the impending attack and the warning issued to senior police officers in charge of VVIP/VIP security is evidence that all those who represented Parliament at the time knew of the mass murder plot. Against the backdrop of Indian intelligence warning and our collective failure to act on it, it would be pertinent to ask the Indians whether they knew the Easter Sunday operation was to facilitate Gotabaya Rajapaksa’s victory at the 2019 presidential poll. Perhaps, a key to the Easter Sunday conspiracy is enigma Sara Jasmin (Tamil girl from Batticaloa converted to Islam) whose husband Atchchi Muhammadu Hasthun carried out the attack on St. Sebastian’s Church, Katuwapitiya

By Shamindra Ferdinando

Pivithuru Hela Urumaya (PHU) leader Udaya Gammanpila’s Pasku Praharaye Mahamolakaru Soya Yema (Searching for the mastermind behind the Easter Sunday attacks) inquired into the 2019 April 21 Easter Sunday carnage. The former Minister and Attorney-at-Law quite confidently argued that the mastermind of the only major post-war attack was Zahran Hashim, one of the two suicide bombers who targeted Shangri-la, Colombo.

Gammanpila launched his painstaking work recently at the Sambuddhathva Jayanthi Mandiraya at Thummulla, with the participation of former Presidents Gotabaya Rajapaksa, who had been accused of being the beneficiary of the Easter Sunday carnage at the November 2019 presidential election, and Maithripala Sirisena faulted by the Presidential Commission of Inquiry (PCoI) that probed the heinous crime. Rajapaksa and Sirisena sat next to each other, in the first row, and were among those who received copies of the controversial book.

PCoI, appointed by Sirisena in September, 2019, in the run-up to the presidential election, in its report submitted to President Gotabaya Rajapaksa, in February, 2020, declared that Sirisena’s failure as the President to act on ‘actionable intelligence’ exceeded mere civil negligence. Having declared criminal liability on the part of Sirisena, the PCoI recommended that the Attorney General consider criminal proceedings against former President Sirisena under any suitable provision in the Penal Code.

PCoI’s Chairman Supreme Court Judge Janak de Silva handed over the final report to President Rajapaksa on February 1, 2021 at the Presidential Secretariat. Gotabaya Rajapaksa received the first and second interim reports on 20 December and on 2 March, 2020, respectively.

The Commission consists of the following commissioners: Justice Janak De Silva (Judge of the Supreme Court and Chairman of the Commission), Justice Nissanka Bandula Karunarathna (Judge of the Court of Appeal), Justice Nihal Sunil Rajapakse (Retired Judge of the Court of Appeal), Bandula Kumara Atapattu (Retired Judge of the High Court) and Ms W.M.M.R. Adikari (Retired Ministry Secretary).

H.M.P. Buwaneka Herath functioned as the Secretary to the PCoI.

It would be pertinent to mention that the Archbishop of Colombo Malcolm Cardinal Ranjith, declined an opportunity offered by President Rajapaksa to nominate a person for the PCoI. The Church leader asserted such a move would be misconstrued by various interested parties. Both the former President and Archbishop of Colombo confirmed that development soon after the presidential election.

Having declared its faith in the PCoI and received assurance of the new government’s intention to implement its recommendations, the Church was taken aback when the government announced the appointment of a six-member committee, chaired by Minister Chamal Rajapaksa, to examine the PCoI and recommend how to proceed. That Committee included Ministers Johnston Fernando, Udaya Gammanpila, Ramesh Pathirana, Prasanna Ranatunga and Rohitha Abeygunawardena.

The Church cannot deny that their position in respect of the Yahapalana government’s pathetic failure to thwart the Easter Sunday carnage greatly influenced the electorate, and the SLPP presidential candidate Gotabaya Rajapaksa directly benefited. Alleging that the Archbishop of Colombo played politics with the Easter Sunday carnage, SJB parliamentarian Harin Fernando, in June 2020, didn’t mince his words when he accused the Church of influencing a decisive 5% of voters to back Gotabaya Rajapaksa. At the time that accusation was made about nine months before the PCoI handed over its report, President Rajapaksa and the Archbishop of Colombo enjoyed a close relationship.

The Church raised the failure on the part of the government to implement the PCoI’s recommendations six months after President Rajapaksa received the final report.

The National Catholic Committee for Justice to Eastern Sunday Attack Victims, in a lengthy letter dated 12 July 2021, demanded the government deal with the following persons for their failure to thwart the attacks. The Committee warned that unless the President addressed their concerns alternative measures would be taken. The government ignored the warning. Instead, the SLPP adopted delaying tactics much to their disappointment and the irate Church finally declared unconditional support for the US-India backed regime change project.

Sirisena and others

On the basis of the 19th Chapter, titled ‘Accountability’ of the final report, the Committee drew President Rajapaksa’s attention to the following persons as listed by the PCoI: (1) President Maithripala Sirisena (2) PM Ranil Wickremesinghe (3) Defence Secretary Hemasiri Fernando (4) Chief of National Intelligence Sisira Mendis (5) Director State Intelligence Service Nilantha Jayawardena.

The 20th Chapter, titled ‘Failures on the part of law enforcement authorities’ in the Final report (First Volume), identified the following culprits ,namely IGP Pujith Jayasundera, SDIG Nandana Munasinghe (WP), Deshabandu Tennakoon (DIG, Colombo, North), SP Sanjeewa Bandara (Colombo North), SSP Chandana Atukorale, B.E.I. Prasanna (SP, Director, Western province, Intelligence), ASP Sisira Kumara, Chief Inspector R.M. Sarath Kumarasinghe (Acting OIC, Fort), Chief Inspector Sagara Wilegoda Liyanage (OIC, Fort)., Chaminda Nawaratne (OIC, Katana), State Counsel Malik Azeez and Deputy Solicitor General Azad Navaavi.

The PCoI named former Minister and leader of All Ceylon Makkal Congress Rishad Bathiudeen, his brother Riyaj, Dr Muhamad Zulyan Muhamad Zafras and Ahamad Lukman Thalib as persons who facilitated the Easter Sunday conspiracy, while former Minister M.L.A.M. Hisbullah was faulted for spreading extremism in Kattankudy.

Major General (retd) Suresh Sallay, who is now in remand custody, under the CID, for a period of 90 days, in terms of the prevention of Terrorism Act (PTA) ,was not among those named by the PCoI. Sallay, who served as the head of the Directorate of Military Intelligence (DMI/from 2012 to 2016) was taken into custody on 25 February and named as the third suspect in the high profile investigation. (Interested parties propagated that Sallay was apprehended on the basis of UK’s Channel 4 claim that the officer got in touch with would-be Easter Sunday bombers, including Zahran Hashim, with the help of Sivanesathurai Chandrakanthan, alias Pilleyan. However, Pilleyan who had been arrested in early April 2025 under PTA was recently remanded by the Mount Lavinia Magistrate’s Court, pending the Attorney General’s recommendations in connection with investigations into the disappearance of a Vice Chancellor in the Eastern Province in 2006. There was absolutely no reference to the Easter Sunday case)

The Church also emphasised the need to investigate the then Attorney General Dappula de Livera’s declaration of a ‘grand conspiracy’ behind the Easter Sunday carnage. The Church sought answers from President Rajapaksa as to the nature of the grand conspiracy claimed by the then AG on the eve of his retirement.

Sallay was taken into custody six years after the PCoI handed over its recommendations to President Rajapaksa and the appointment of a six-member parliamentary committee that examined the recommendations. The author of Pasku Praharaye Mahamolakaru Soya Yema, Gammanpila, the only lawyer in the six-member PCoI, should be able to reveal the circumstances that committee came into being.

Against the backdrop of the PCoI making specific recommendations in respect of the disgraced politicians, civilian officials and law enforcement authorities over accountability and security failures, the SLPP owed an explanation regarding the appointment of a six-member committee of SLPPers. Actually, the SLPP owed an explanation to Sallay whose arrest under the PTA eight years after Easter Sunday carnage has to be discussed taking into consideration the failure to implement the recommendations.

Let me briefly mention PCoI’s recommendations pertaining to two senior police officers. PCoI recommended that the AG consider criminal proceedings against SDIG Nandana Munasinghe under any suitable provision in the Penal Code or Section 82 of the Police Ordinance (Final report, Vol 1, page 312). The PCoI recommended a disciplinary inquiry in respect of DIG Deshabandu Tennakoon. The SLPP simply sat on the PCoI recommendations.

Following the overthrow of President Rajapaksa by a well-organised Aragalaya mob in July 2022, the SLPP and President Ranil Wickremesinghe paved the way for Deshabandu Tennakoon to become the Acting IGP in November 2023. Wickremesinghe went out of his way to secure the Constitutional Council’s approval to confirm the controversial police officer Tennakoon’s status as the IGP.

Some have misconstrued the Supreme Court ruling, given in January 2023, as action taken by the State against those named in the PCoI report. It was not the case. The SC bench, comprising seven judges, ordered Sirisena to pay Rs 100 mn into a compensation fund in response to 12 fundamental rights cases filed by families of the Easter Sunday victims, Catholic clergy and the Bar Association of Sri Lanka. The SC also ordered ex-IGP Pujith Jayasundara and former SIS head Nilantha Jayawardene to pay Rs. 75m rupees each, former Defence Secretary Hemasiri Fernando Rs. 50 million and former CNI Sisira Mendis Rs. 10 million from their personal money. All of them have been named in the PCoI report. As previously mentioned, Maj. Gen. Sallay, who headed the SIS at the time of the SC ruling that created the largest ever single compensation fund, was not among those faulted by the sitting and former justices.

Initial assertion

The Archbishop of Colombo, in mid-May 2019, declared the Easter Sunday carnage was caused by local youth at the behest of a foreign group. The leader of the Catholic Church said so in response to a query raised by the writer regarding a controversial statement made by TNA MP M. A. Sumanthiran. The Archbishop was joined by Most Ven Ittapane Dhammalankara Nayaka Thera of Kotte Sri Kalyani Samagri Dharma Maha Sangha Sabha of Siyam Maha Nikaya. They responded to media queries at the Bishop’s House, Borella.

The Archbishop contradicted Sumanthiran’s claim that the failure on the part of successive governments to address the grievances of minorities over the past several decades led to the 2019 Easter Sunday massacre.

Sumanthiran made the unsubstantiated claim at an event organised to celebrate the first anniversary of the Sinhala political weekly ‘Annidda,’ edited by Attorney-at-Law K.W. Janaranjana at the BMICH.

The Archbishop alleged that a foreign group used misguided loyal youth to mount the Easter Sunday attacks (‘Cardinal rejects TNA’s interpretation’, with strap line ‘foreign group used misguided local youth’, The Island, May 15, 2019 edition).

Interested parties interpreted the Easter Sunday carnage in line with their thinking. The writer was present at a special media briefing called by President Sirisena on 30 April, 2019 at the President’s House where the then Northern Province Governor Dr. Suren Raghavan called for direct talks with those responsible for the Easter Sunday massacre. One-time Director of the President’s Media Division (PMD) Dr. Raghavan emphasised that direct dialogue was necessary in the absence of an acceptable mechanism to deal with such a situation. Don’t forget Sisisena had no qualms in leaving the country a few days before the attacks and was away in Singapore when extremists struck. Sirisena arrived in Singapore from India.

The NP Governor made the declaration though none of the journalists present sought his views on the post-Easter Sunday developments.

During that briefing, in response to another query raised by the writer, Army Commander Lt. Gen. Mahesh Senanayake disclosed that the CNI refrained from sharing intelligence alerts received by the CNI with the DMI. Brigadier Chula Kodituwakku, who served as Director, DMI, had been present at Sirisena’s briefing and was the first to brief the media with regard to the extremist build-up leading to the Easter Sunday attacks.

The collapse of the Yahapalana arrangement caused a security nightmare. Frequent feuds between Yahapalana partners, the UNP and the SLFP, facilitated the extremists’ project. The top UNP leadership feared to step in, even after Justice Minister Dr. Wijeyadasa Rajapaksha issued a warning in Parliament, in late 2016, regarding extremist activities and some Muslim families securing refuge in countries dominated by ISIS. Instead of taking tangible measures to address the growing threat, a section of the UNP parliamentary group pounced on the Minister.

The UNP felt that police/military action against extremists may undermine their voter base. The UNP remained passive even after extremists made an abortive bid to kill Thasleem, Coordinating Secretary to Minister Kabir Hashim, on 8 March 2019. Thasleem earned the wrath of the extremists as he accompanied the CID team that raided the extremists’ facility at Wanathawilluwa. The 16 January 2019 raid indicated the deadly intentions of the extremists but PM Wickremesinghe was unmoved, while President Sirisena appeared clueless as to what was going on.

Let me reproduce the PCoI assessment of PM Wickremesinghe in the run-up to the Easter Sunday massacre. “Upon consideration of evidence, it is the view of the PCoI that the lax approach of Mr. Wickremesinghe towards Islamic extremists as the Prime Minister was one of the primary reasons for the failure on the part of the then government to take proactive steps towards tackling growing extremism. This facilitated the build-up of Islam extremists to the point of the Easter Sunday attack.” (Final report, Vol 1, pages 276 and 277).

The National Catholic Committee for Justice to Easter Sunday Attack Victims, in its letter dated 12 July, 2021, addressed to President Rajapaksa, questioned the failure on the part of the PCoI to make any specific recommendations as regards Wickremesinghe. Accusing Wickremesinghe of a serious act of irresponsibility and neglect of duty, the Church emphasised that there should have been further investigations regarding the UNP leader’s conduct.

SLPP’s shocking failure

The SLPP never made a serious bid to examine all available information as part of an overall effort to counter accusations. If widely propagated lie that the Easter Sunday massacre had been engineered by Sallay to help Gotabaya Rajapaksa win the 2019 presidential poll is accepted, then not only Sirisena and Wickremesinghe but all law enforcement officers and others mentioned in the PCoI must have contributed to that despicable strategy. It would be interesting to see how the conspirators convinced a group of Muslims to sacrifice their lives to help Sinhala Buddhist hardliner Gotabaya Rajapaksa to become the President.

Amidst claims, counter claims and unsubstantiated propaganda all forgotten that a senior member of the JVP/NPP government, in February 2021, when he was in the Opposition directly claimed Indian involvement. The accusation seems unfair as all know that India alerted Sri Lanka on 4 April , 2019, regarding the conspiracy. However, Asanga Abeygoonasekera, in his latest work ‘Winds of Change’ questioned the conduct of the top Indian defence delegation that was in Colombo exactly two weeks before the Easter Sunday carnage. Abeygoonasekera, who had been a member of the Sri Lanka delegation, expressed suspicions over the visiting delegation’s failure to make reference to the warning given on 4 April 2019 regarding the plot.

The SLPP never had or developed a strategy to counter stepped up attacks. The party was overwhelmed by a spate of accusations meant to undermine them, both in and outside Parliament. The JVP/NPP, in spite of accommodating Mohamed Yusuf Ibrahim, father of two Easter Sunday suicide bombers Ilham Ahmed Ibrahim (Shangila-la) and Imsath Ahmed Ibrahim (Cinnamon Grand), in its 2015 National List was never really targeted by the SLPP. The SLPP never effectively raised the possibility of the wealthy spice trader funding the JVP to receive a National List slot.

The Catholic Church, too, was strangely silent on this particular issue. The issue is whether Mohamed Yusuf Ibrahim had been aware of the conspiracy that involved his sons. Another fact that cannot be ignored is Attorney-at-Law Hejaaz Hizbullah who had been arrested in April 2020 in connection with the Easter Sunday carnage but granted bail in February 2022 had been the Ibrahim family lawyer.

Hejaaz Hizbullah’s arrest received international attention and various interested parties raised the issue.

The father of the two brothers, who detonated suicide bombs, was granted bail in May 2022.

Eric Solheim, who had been involved in the Norwegian-led disastrous peace process here, commented on the Easter Sunday attacks. In spite of the international media naming the suicide bombers responsible for the worst such atrocity Solheim tweeted: “When we watch the horrific pictures from Sri Lanka, it is important to remember that Muslims and Christians are small minorities. Muslims historically were moderate and peaceful. They have been victims of violence in Sri Lanka, not orchestrating it.”

That ill-conceived tweet exposed the mindset of a man who unashamedly pursued a despicable agenda that threatened the country’s unitary status with the connivance of the UNP. Had they succeeded, the LTTE would have emerged as the dominant political-military power in the Northern and Eastern Provinces and a direct threat to the rest of the country.

Midweek Review

War with Iran and unravelling of the global order – I

Published

6 days ago

2026/04/8

Sahan Weerasooriya

At present, the world stands in the midst of a transitional and turbulent phase, characterised by heightened uncertainty and systemic flux, reflecting an ongoing transformation of the modern global order. The existing global order, rooted in the US hegemony, shows unmistakable signs of decay, while a new and uncertain global system struggles to be born. In such moments of profound transformation, as Antonio Gramsci observed, morbid symptoms proliferate across the body politic. From a geopolitical perspective, the intensifying coordinated aggression of the United States and Israel against Iran is not merely a regional crisis, but an acceleration of a deeper structural transformation in the international order. In this context, the conduct of Donald Trump appears less as an aberration and more as a morbid symptom of a declining US-led global order. As Amitav Acharya argues in The Once and Future World Order (2025), the emerging global order may well move beyond Western dominance. However, the pathway to that future is proving anything but orderly, shaped instead by disruption, unilateralism, and the unsettling symptoms of a system in transition.

Origins of the Conflict

To begin with, the origins and objectives of the parties to the present armed confrontation require unpacking. In a sense, the current Persian Gulf crisis reflects a convergence of long-standing geopolitical rivalries and evolving security dynamics in the Middle East. The roots of tension between the West and the Middle East can be traced back to earlier historical encounters, from the Persian Wars of classical antiquity to the Crusades of the medieval period. A new phase in the region’s political trajectory commenced in 1948 with the establishment of Israel—widely perceived as a Western enclave within the Arab world—and the concurrent displacement of approximately 700,000 Palestinians from their homeland. Since then, Israel has steadily consolidated and expanded its territory, a process that has remained a persistent source of regional instability. The Iranian Revolution introduced a further layer of complexity, fundamentally reshaping regional alignments and ideological contestations. In recent years, tensions between Israel and the United States on one side and Iran on the other have steadily intensified. The current phase of the conflict, however, was directly triggered by coordinated U.S.–Israeli airstrikes on both civilian and military targets on 28 February 2026, which, as noted in a 2 April 2026 statement by 100 international law experts from leading U.S. universities, constituted a clear violation of the UN Charter and International Humanitarian Law (IHL).

Objectives and Strategic Aims

Israel’s strategic objective appears to be directed toward the systematic and total destruction of Iran’s military, nuclear, and economic capabilities, driven by the perception that Iran remains the principal obstacle to its security and its pursuit of regional primacy. Israel was aware that Iran did not possess a nuclear weapon at the time; however, its nuclear programme remained a subject of international contention, with competing assessments regarding its ultimate intent and potential for weaponisation.

The United States, for its part, appears to be pursuing more targeted political and strategic objectives, including eventual transformation of Iran’s current political regime. Washington has long regarded the Iranian leadership as fundamentally antagonistic to U.S. interests in the Middle East. In this context, the United States may seek to enhance its strategic leverage over Iran, including in relation to its substantial oil and gas resources, a point underscored in recent statements by Donald Trump. It must be noted, however, successive U.S. administrations since 1979 have avoided direct large-scale military confrontation with Iran, preferring instead a combination of sanctions, diplomatic pressure, and indirect military engagement.

The positions of other Arab states in the Persian Gulf are shaped by a combination of security calculations, sectarian considerations, and broader geopolitical alignments. While several Gulf Cooperation Council (GCC) members, notably Saudi Arabia and United Arab Emirates, have expressed tacit support for measures that counter Iranian regional influence, their involvement remains calibrated to avoid direct military confrontation. Their position is informed by the belief that Iran provides backing to militant non-state actors, including Hezbollahs in the West Bank and the Houthis in Southern Yemen, which they view as destabilising forces in the region. These states are balancing competing priorities: the desire to curb Iran’s power projection, maintain strong security and economic ties with the United States, and preserve domestic stability. At the same time, countries such as Oman and Qatar have adopted more neutral or mediating stances, emphasizing diplomatic engagement and conflict de-escalation.

Militarily, Iran is not positioned to match the combined military capabilities of U.S.–Israeli forces. Nevertheless, it retains significant asymmetric leverage, particularly through its capacity to influence global energy flows. Control over critical maritime chokepoints, most notably the Strait of Hormuz, provides Tehran with a potent strategic instrument to disrupt global oil supply. Iranian leadership appears to view this leverage as a key pressure point, designed to compel global economic actors to push Washington and Tel Aviv toward a cessation of hostilities and a negotiated settlement. In this context, attacks on oil and gas infrastructure, shipping routes, and supply lines constitute central components of Iran’s survival strategy. As long as the conflict persists and energy flows through the Strait of Hormuz remain disrupted, the resulting instability is likely to generate severe repercussions across the global economy, increasing pressure on the United States to halt military operations against Iran.

Now entering its fifth week, the conflict continues to flare intensely, characterised by sustained and intensive aerial operations. Joint U.S.–Israeli strikes have reportedly destroyed substantial elements of Iran’s air and naval capabilities, as well as critical military and economic infrastructure. Nevertheless, Iran has retained the capacity to conduct guided missile strikes within Israel and against selected U.S. economic, diplomatic, and military assets across the Middle East, including reported long-range attacks on the U.S. facility at Diego Garcia in the Indian Ocean, approximately 4,000 kilometers from Iranian territory. Initial U.S. and Israeli strategic calculations—anticipating that a decisive initial strike and the targeted killing of Iranian Supreme Leader Ali Khamenei would precipitate regime collapse and popular uprising—have not materialized. On the contrary, the destruction of civilian facilities has strengthened anti-American sentiment and reinforced domestic support for the Iranian leadership. While Iran faced initial setbacks on the battlefield, it has achieved notable success in the international media front, effectively shaping global perceptions and advancing its propaganda objectives. By the fifth week, Tehran’s asymmetric strategy has yielded tangible results, including the downing of two U.S. military aircraft, F15E Strike Eagle fighter jet and A10 Thunderbolt II (“Warthog”) ground-attack aircraft , signaling the resilience and operational efficacy of Iran’s military power.

The Military Industrial Complexes and ProIsrael Lobby

Why did the United States initiate military action against Iran at this particular juncture? Joe Kent, who resigned in protest over the war, stated that available intelligence did not indicate an imminent Iranian capability to produce a nuclear weapon or pose an immediate threat to the United States. This assessment raises important questions about the stated objective of dismantling Iran’s nuclear programme, suggesting that it may have served to obscure broader strategic and economic considerations underpinning the intervention. To understand the timing and rationale of the U.S. intervention in the Persian Gulf, it is therefore necessary to examine the influence of two powerful domestic pressure groups: the military–industrial complex and the pro-Israel lobby.

The influence of the U.S. military–industrial complex on American foreign policy is most clearly manifested through the institutionalized “revolving door” between defense corporations and senior positions within the U.S. administration. Over the past two decades, key figures such as Lloyd Austin (Secretary of Defence, 2021–2025), a former board member of Raytheon Technologies, Mark Esper (Secretary of Defence 2019–2020), who previously served as a senior executive at the same firm, and Patrick Shanahan (2019) from Boeing exemplify the direct movement of personnel from industry into the highest levels of strategic decision-making. This circulation is complemented by influential policy actors such as Michèle Flournoy (Under Secretary of Defence Under President Obama) and Antony Blinken (Secretary of State 2021 to 2025, Deputy Secretary of State 2015 to 2017), whose engagement with consultancies like WestExec Advisors further blurs the boundary between public policy and private defense interests. This pattern appears to persist under the present Trump administration, where the interplay between defense industry interests and strategic policymaking continues to shape procurement priorities and threat perceptions. Consequently, the military–industrial complex operates not merely as an external pressure group but as an internalized component of the policy process, shaping U.S. foreign policy in ways that align strategic objectives with the structural and commercial interests of the defense sector. Armed conflicts may also generate substantial commercial opportunities, as increased military spending often translates into expanded profits for defense contractors.

The influence of the pro-Israel lobby on U.S. foreign policy is best understood as a dense network of advocacy organisations, donors, policy institutes, and political actors that shape both elite consensus and decision-making within successive administrations. At the center of this network is the American Israel Public Affairs Committee, widely regarded as one of the most effective lobbying organisations in Washington, which works alongside a broader constellation of groups and donors to sustain bipartisan support for Israel. This influence is reinforced through the presence of senior policymakers and advisors with strong ideological or institutional affinities toward Israel, including Donald Trump and Benjamin Netanyahu, whose close political alignment has translated into consistent diplomatic and strategic backing. Policy decisions—ranging from the recognition of Jerusalem as Israel’s capital to continued military assistance—reflect not only geopolitical calculations but also the domestic political salience of pro-Israel advocacy within the United States. Consequently, the pro-Israel lobby operates not merely as an external pressure group but as an embedded force within the policy ecosystem, shaping U.S. foreign policy in ways that sustain a strong and often unconditional commitment to Israeli security and strategic interests. A fuller explanation of U.S. policy toward Iran emerges when the influence of both the military–industrial complex and the pro-Israel lobby is considered together. These two forces, while distinct in composition and motivation, converge in reinforcing a strategic outlook that prioritises the identification of Iran as a central threat and legitimizes the use of coercive military instruments.

Global Economic Fallout

After five weeks of sustained conflict, the trajectory of the war suggests that Iran’s strategy of resilience and asymmetric resistance is yielding tangible effects. While the United States, alongside Israel, has inflicted significant damage on Iran’s economic and military infrastructure, it has not succeeded in eroding Tehran’s capacity—or resolve—to continue the conflict through unconventional means. At the same time, Washington appears to be encountering increasing difficulty in bringing the war to a decisive conclusion, even as signs of strain emerge in its relations with key European allies. Most importantly, the repercussions of the conflict are no longer confined to the battlefield: the unfolding crisis has generated a widening economic shock that is reverberating across global markets and supply chains. It is this broader international economic impact of the war that now warrants closer examination.

The Persian Gulf conflict is rapidly sending shockwaves through the global economy. At the forefront is the energy sector: even partial disruptions to oil and gas exports from the region are driving prices sharply higher, placing severe pressure on energy-importing economies in Europe and Asia and fueling inflation worldwide. Maritime trade is also under strain, as heightened risk prompts longer shipping routes, increased freight rates, and rising war-risk premiums. These disruptions ripple through global supply chains, pushing up the cost of goods far beyond the energy sector.

Insurance costs for shipping and aviation are soaring as large zones are designated high-risk or even excluded from coverage, further elevating transport costs and pricing out smaller operators. Together, these pressures constitute a systemic economic shock: industrial production costs rise, supply chains fragment, and trade volumes contract, stressing manufacturing, logistics, and consumption simultaneously.

The cumulative effect is already slowing global growth. Major economies such as the EU, China, and India face slower expansion, while import-dependent states risk recession. Trade-driven sectors are contracting, reinforcing a scenario of high inflation and stagnating growth. Air travel is also impacted, with restricted airspace, higher fuel prices, and elevated insurance premiums driving up ticket costs and lengthening travel routes. Rising energy prices, logistics bottlenecks, and increased production costs are pushing up food prices and cost-of-living pressures, potentially forcing central banks into tighter monetary policy and slowing growth further.

Finally, global manufacturing—from chemicals and plastics to agriculture—is experiencing ripple effects as supply chain disruptions intensify shortages and price increases. The conflict in the Persian Gulf is thus not only a regional security crisis but also a catalyst for broad, interconnected economic disruptions that are reverberating across markets, trade networks, and everyday life worldwide.

(To be continued)