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Midweek Review

Foreign Exchange Crisis

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By Dr. C. S. Weeraratna

csweera@sltnet.lk Sri Lanka is facing a deepening financial crisis. According to media reports there is a short supply of essential items such as fuel, medicine and gas for domestic use attributed to the foreign exchange (FE) crisis. Dhammika Perera (DP) has proposed a seven-pronged strategy to overcome Sri Lanka’s foreign exchange crisis (The Island 30 January).

One of the strategies suggested by DP is that the government build a university town consisting of five universities within 30 minutes from the Bandaranaike International Airport at Katunayake, to accommodate 150,000 students (30,000 at each university). This is an excellent idea but it will cost the government at least Rs10 billion at the rate of Rs 2 billion per university. Once the universities are built, it will be necessary to get qualified academic staff and suitable accommodation. Further it will take a couple of years to build the five universities. Some need to have laboratories and equipping these adequately is expensive, time consuming and requires a substantial amount of FE. It is a long-term project. Currently, there are 17 universities located in different parts of the country. Perhaps, it may be more realistic if five selected universities already functioning are developed to meet the required standards. Instead of having all the five selected universities in Katunayaka it would be desirable if there is at least one in the north and another one in the east so that those in these regions are also benefited.

Another strategy proposed by DP is to build two hospitals like Singapore’s Mount Elizabeth with internationally recognised facilities. As in the case of establishing new universities, building two such hospitals will take a long time, perhaps two to three years and will require a great deal of foreign exchange. Developing some existing hospitals to meet the stipulated standards may be a realistic alternative.

The total extent under coconut cultivation in Sri Lanka is around 400,000 ha and about 325,000 ha are small holdings. The annual production of coconut has been fluctuating around 3,000 million nuts, (approximately 6000 nuts per hectare). As suggested by DP, developing the coconut industry by planting 1.5 million nuts annually is very timely. At the same time the state of the existing coconut plantations should be looked into. If the production of the existing coconut lands is increased by 1000 nuts per hectare per year through better management and applying organic and inorganic fertilisers, the total production can be increased substantially within a year which will increase the export income from coconut.

One of the main strategies to solve the current FE crisis would be to increase export earnings and reduce expenditure on imports. Most of the activities involved are short term while the others are medium or long term.

Increase export earnings

The dire need to increase our export earnings to meet the severe financial crisis we are facing today has been emphasised by many. Increasing exports is of paramount importance to improve the present FE situation. A major source of FE is the plantation sector. Around 800,000 ha are cultivated with plantation crops tea, rubber and coconut and this sector, in the last few years, earned nearly Rs. 360 billion annually. However, as indicated in table 1, these major export crops do not show a substantial increase in production during the last five years and the contribution from this sector has remained at nearly 20 percent of the export income. Consequently, strategies need to be implemented to increase production and thereby, FE earnings from this sector. There are many state sector organisations to implement such strategies.

As shown in Table 1 tea production has been fluctuating around 300 million kg per year during the last five years, in spite of several institutions assigned to the tea sector. The average tea yields are considerably lower than the potential yields. It has been reported that some of the cultivars developed by the Tea Research Institute of Sri Lanka had been yielding around 8,000 kg per hectare in South India under commercial conditions but the average tea yield in Sri Lanka is much lower. In the smallholder tea sector the average yield is around 1800 kg per hectare and in the estate sector it is about 1200 kg per hectare. In 2020 tea earned Rs. 230 billion in FE. Better management practices in the short term would increase the quantity and quality of the tea produced making it possible to increase FE earnings substantially from the current Rs. 230 billion.

Rubber is another important export crop. In 2017 it earned nearly Rs. 6 billion in foreign exchange but has decreased during the following three years. Based on Central Bank annual reports, the total Rubber production in 2010 was 152.9 million kg and by 2019 it had plummeted to 74.8 million kg. The corresponding average yields are 1561 kg per hectare and 665 kg per hectare respectively. These figures indicate that the Sri Lankan rubber sector is ailing in spite of several institutions assigned to promote rubber production in the country. With the current higher rubber prices it would be possible to earn more FE by increasing rubber production through better management practices which would produce results in the short term. In the last few years the rubber sector was affected by many factors, one of which is ineffective management.

Coconut production too has declined during the last five years as shown in Table 1. This appalling situation in the plantation sector can be attributed to many factors. If the productivity of this sector is raised, by implementing better management practices it would be possible to increase foreign exchange earnings. Most of these practices would produce results in the short term.

A large number of crops, other than tea, rubber and coconut, cultivated in Sri Lanka have high potential as export crops. There are 24 agro ecological zones, each characterised by a specific climate and soil. This makes possible the cultivation of different types of crops such as spice crops, tuberous crops, horticultural (fruit crops) and floricultural crops and medicinal herbs.

Sri Lanka is famous for spices. The most sought after spice crops are cinnamon, pepper, cloves, cardamoms, nutmeg, mace and vanilla which grow in abundance mainly in the wet and intermediate zone. In 2020 the county earned nearly Rs.60 billion by exporting spice crops.

Cinnamon is the most important spice commodity in the spice sector. In 2019, it earned around Rs. 32 billion in FE. The production of cinnamon has been fluctuating around 20,000 tonnes per year during the last few years. Sri Lanka received its first ever Geographical Indication (GI) certification when the European Union (EU) Commission on 2 February, 2022 granted GI status to Ceylon Cinnamon. This would increase the demand for Sri Lanka cinnamon.

Pepper is the second most important commodity among spices. It is grown in the wet and intermediate zones mostly as a mixed crop. The Sri Lankan Pepper has a higher piperine content which gives it a superior quality and pungency. Annual production of pepper too has remained stagnant at around 20,000 kg.

Other spices such as cloves, cardamom, nutmeg and mace have the potential to earn a substantial amount of FE. With the increase of international demand for natural products, and the government’s focus on enhancing and diversifying its value added range, spices and essential oils extracted from these crops will continue to earn more FE.

Dehydrated food is another agricultural product which has the potential to earn much needed FE. During some months there is a glut of fruits and exporting dehydrated or canned fruits would bring in an appreciable amount of FE.

In any programme or plan to increase foreign exchange earnings from the agriculture sector, agro-industries have to be given much emphasis. A large number of crops cultivated in Sri Lanka have considerable potential in various agro-industries. However only rubber, coconut and a few fruit crops are used in industries. Crops such as cassava, horticultural and floricultural crops, medicinal herbs, cane, bamboo, sunflower, castor and ayurvedic herbs have a considerable industrial or export potential but are not cultivated to any appreciable extent. Development of agro-industries will also increase export income and will have a tremendous impact on the economy of the country and also provide employment opportunities to rural people. The private sector can get involved in such projects for which appropriate technical assistance needs to be provided by the relevant public organisations.

Decrease expenditure on imports

While implementing strategies to increase our FE income by promoting exports, action also needs to be taken to decrease our expenditure on imports. During the period between 2017 and 2020 annual expenditure on importing food has been around Rs. 320 billion. The current expenditure on food imports is likely to be even higher due to the depreciation of the SL rupee, and shortage of rice and other food crops, the result of banning import of agrochemicals.

One of the problems the country is facing is the fuel crisis, which is likely to have extremely undesirable repercussions. A large sum of money is spent on importing petroleum to Sri Lanka. In 2020 we have imported fuel worth Rs 540 billion. If we are going to consume petroleum products at the current rate, at least an additional Rs. 50 billion will have to be spent in 2022. Consequently, it is essential to reduce petrol and diesel consumption. In many other countries such as China, Thailand and Singapore, action has already been taken to reduce fuel or power consumption and cut down wastage. If we reduce our power consumption by 10 percent, it will result in a saving of Rs 60 billion in foreign exchange.

Studies conducted in many countries have found that ethanol is a viable alternative for petrol. Many countries are either producing or using ethanol in large quantities or are providing incentives to expand ethanol production and use. Prompted by the increase in oil prices in the 1970s, Brazil introduced a program to produce ethanol for use in automobiles to reduce oil imports. Brazilian ethanol is made mainly from sugar cane. Among other countries using ethanol as a bio fuel are Australia, France, India, Sweden, USA and South Africa. Use of ethanol tends to reduce environmental pollution caused by compounds such as tetraethyl lead, used in petrol. Ethanol can be made from high starch containing crops such as manioc and maize, or high sugar containing crops such as sugarcane. These crops are cultivated in Sri Lanka. Around 10 million litres of alcohol are produced annually at Pelwatta and Sevanagala sugar factories. These can be mixed with petrol to be used at least in three wheelers so that those who use them need not pay higher fares. A few years ago former Science and Technology Minister Dr. Thissa Witharana appointed a committee to look into the possibility of using substitutes for fuel. The committee recommended the use of ethyl alcohol and Jatropha oil as bio-fuels. No follow-up action was taken by the subsequent governments to promote these alternatives as biofuels. Oil from Jatropha (Weta Erandu), a crop that can be grown widely in the Dry Zone of Sri lanka, can be used as a biofuel.

Dendro power can be generated using fast growing nitrogen fixing trees such as gliricidia and Leucaena. These crops can be used not only to generate electricity but are also a good source of animal feed and fertilisers. It may be more beneficial to grow these crops in eroded tea lands where the yields are relatively low. Soil erosion in such tea lands can also be reduced by growing these crops. The Bio Energy Association of Sri Lanka has been instrumental in promoting cultivation of gliricidia.

Sri Lanka, a country begging for dollar loans to import medicine and fuel, which are critical, need to have flexible export and import policies. As indicated above, there are 24 agro ecological zones, each characterised by a specific climate and soil. This makes possible the cultivation of different types of crops. Most of the food imported can be locally produced, thereby reducing expenditure on food imports. A closer look at the imports indicate that around Rs. 50 billion (nearly 16 percent of food imports) in FE is spent on importing sugar, most of which can be locally produced. The total annual requirement of sugar in the country is around 620,000 tonnes, but only about 50,000 tonnes are produced locally. Sugarcane has a considerable potential to reduce food import expenditure. Sugar production in the country has not increased by any appreciable amount during the present decade. The Kantale sugar factory remains closed while a plan to cultivate sugarcane in Bibile remains shelved. Jaggery made from kitul, and sugarcane are good substitutes for sugar manufactured from sugarcane.

A substantial amount of foreign exchange is spent on importing milk. In 2020 Rs. 60 billion in FE was spent on importing milk and dairy products. We have around 1 million mostly indigenous cattle. Their productivity is low (one to three litres per day) mainly due to the poor nature of the breeds and inadequate low quality feed supply. The dairy industry has the potential to contribute considerably to solve Sri Lanka’s FE crisis. Milk production can be increased by increasing availability of cattle feed and thereby an appreciable amount of foreign exchange spent on milk imports can be reduced. Milk production also plays an important role in alleviating malnutrition and offers many employment opportunities. If milk production can be increased, an appreciable amount of foreign exchange spent on milk imports can be reduced, while also improving the nutritional status of the people.

Expenditure on subsidiary food crops such as chillies, green gram, ground nut and potato is few billions of rupees. The extent under these crops and their average per hectare yields have not increased by any appreciable amount during the last decade. A few years ago, a former Minister of Agricultural Development, Chamal Rajapaksa appointed an Advisory Panel to make proposals to develop the agricultural sector so that there is a quantitative and qualitative increase in crop production at a lower cost with no damage to the environment. The recommendations of the panel were mainly on the development and use of better varieties of seeds and planting material; effective control of weeds, insect pests and diseases; better water management, and water conservation; proper use of inorganic and organic fertilisers; control of soil degradation and appropriate land use; promotion of agro-industries and carrying out relevant agricultural research and use of their findings. During the last few years numerous programmes such as AMA, ‘Waga Sangramaya’ and ‘Govi Sevana’ were implemented. All these activities and programmes, appear to have not made any appreciable positive impact on the agricultural sector of the country, indicated by increasing expenditure on food.

In addition to sugar, milk and rice, we spend a colossal sum on importing food items which can be locally produced. Among these are lentils (Rs. 20 billion), onions (Rs 16 billion), maize (Rs. 10 billion), fruits and vegetables and spices, mainly chillies. Even herbs such as katuwelbatu and Thippili, which can be produced locally and used in ayurvedic drugs, are imported at a cost of nearly six million US dollars every year. Most of these crops can be cultivated in the dry zone, where only about two million acres are in productive use out of the 4.5 million ha. Non-availability of adequate rainfall during the Yala season is one of the limiting factors of crop production in the dry zone. However, better water management practices and rainwater harvesting would resolve this limitation.

Although hundreds of research projects related to plantation and food crops are carried out by the faculties of agriculture and Department of Agriculture there appears to be very little liaison or interaction between the relevant institutions, to utilise the research findings in our efforts to increase productivity in the agriculture sector, which will result in saving an appreciable amount of FE.



Midweek Review

US paying the price for disregarding military advice

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March 4: General Dan Caine addressing the Operation 'Epic Fury' media briefing (pic courtesy official website)

Jayasekera

Sri Lanka recently sought Saudi assistance to introduce advance radar technology, capable of detecting approaching targets and drone capability to meet aerial threats. On behalf of the NPP government, that request was made by Deputy Defence Minister Maj. Gen. (retd) Aruna Jayasekera when he met Mohammed bin Abdulrahman Al-Ghribi, Commander of the Royal Saudi Naval Forces, on the sidelines of the World Defence Show 2026 in Saudi Arabia, in February, this year. They also discussed the possibility of Saudi ships visiting Colombo.

Jayasekera also sought training opportunities for SLAF in Saudi Arabia when he met Lt. Gen. Mazyad bin Sulaiman Al-Amro, Commander of the Royal Saudi Air Defence Forces. Jayasekera discussed with Vice Admiral Fahad Al Ghofaily, Deputy Chief of General Staff, the possibility of securing Saudi assistance to surveillance and deep sea operational capabilities of the Navy.

Saudi Arabia has been repeatedly hit by Iran during its counter offensive. In fact, Iran stepped up attacks in the wake of the US bombing of Kharg Island, a major Iranian oil facility. It would be pertinent to mention that Admiral Steve “Web” Koehler, Commander of the US Pacific Fleet, visited New Delhi and Colombo, less than 10 days before the outbreak of war, and here he met both Minister Jayasekera and Defence Secretary Air Vice Marshal (retd) Sampath Thuyakontha. It was Koehler’s second visit after the change of government in Sept. 2024. Don’t forget that it was Koehler’s command that alerted Sri Lanka, on the morning of 4 March, on the sinking of the unarmed Iranian frigate Dena.

The meticulously planned assassination of Iranian Supreme Leader Ayatollah Ali Khamenei on 28 February was meant to bring about a swift regime change and a victorious end to the war. The joint Israeli-US war machine assumed that such a high profile decapitation strike would pave the way for swift public uprising and capitulation of the Iranian government.

The aggressors, quite wrongly, assumed that those who launched the costly protest campaign in Iran, in late December last year, against the unbearable cost of living, would be able to exploit Khamenei’s assassination.

Unpredictable US President Donald Trump was so confident, on the first day of the offensive, that he urged the Iranian military to lay down their arms and its people to take over their government. International media quoted the Republican Chief as having said: “It will be yours to take”.

Trump disregarded his top military adviser, Chairman of the Joint Chiefs of Staff, Air Force General Dan Caine’s warning against attacking Iran. US media reported that Caine, who succeeded Air Force General C.Q. Brown, sacked by Trump in February 2021, warned that war could be risky, potentially drawing the US into a prolonged conflict.

Over two weeks into the war, the Israeli-US assumption seems utterly wrong with those, who genuinely believed in the sure collapse of the Iranian administration following the decapitating strike, are struggling to cope up with the spirited Iranian counter attacks. While enduring a much larger devastating bombing campaign, compared to the 12-day war in June last year, Iran overwhelmed Israel and Gulf countries where powerful US forces were stationed. Their costly missile defences seemed ineffective against Iranian missile and drone salvos that caused unprecedented chaos in the region.

But, what really astonished the Gulf states was Iran’s blockade of the Strait of Hormuz – the only maritime passage between the Gulf and the Gulf of Oman and the route for about a quarter of the global liquefied natural gas and seaborne trade from Gulf countries. This stunned the aggressors and those who blindly backed their despicable strategy.

Iran has categorically denied missile and drone attacks on Cyprus, Azerbaijan and Turkey. If Iran didn’t target them, who did? Whoever staged those attacks, their intention is clear. They want to involve NATO (North Atlantic Treaty Organisation) in the Israeli-US misadventure by hitting NATO members Cyprus and Turkey. Why would Iran attack Turkey against the backdrop of Ankara’s condemnation of Khamenei’s assassination, and also denied the use of its airspace, territory, and territorial waters to the US armed forces for the ongoing war?

The US announcement on March 12 that curbs on Russian oil would be lifted till April 11 underscored the gravity of the situation. Having failed to achieve a swift ‘regime change,’ their much touted primary objective in Operation ‘Epic Fury,’ the US has no option but to swallow its pride and seek Vladimir Putin’s intervention. The US ended with egg on face. It would be pertinent to mention the US sanctioned Russian oil immediately after the launch of Moscow’s Special Operation against Ukraine in February 2022. That ban had been based on the assumption that oil revenue enabled Russia to prolong the war in Ukraine.

Does the 11 April deadline mean that the Israel-US combine seriously believed that Iran could be defeated by that time? Intense media coverage of the conflict indicated that Israel and US objectives in Iran weren’t the same. Regardless of repeatedly vowing to achieve regime change in Iran, the aggressors ended up examining ways and means of exiting the conflict triggered by them. The way Iran has been responding to Israeli-US attacks, the West cannot fully restore Hormuz by the second week of April. Prolong war may force US to extend waiver on sanctioned Russian oil, thereby further strengtheing Putin.

The US-Israeli strategy has suffered in the absence of an anticipated large scale public uprising, in Iran, immediately after the decapitation strike. When that failed to materialise, as expected, the overall picture of the largest ever combined Israeli-US offensive changed.

Unilateral US decision to lift the ban on Russian oil, even temporarily, divided the western grouping backing Ukraine. In spite of the US being a critical member of that grouping, the Iranian action left Trump with no alternative but to ease pressure on global oil markets at Ukraine’s expense. The Europeans realise that the failure to effect regime change may compel Trump to extend waiver on oil sanctions on Russia.

What really went wrong? President Trump has been so confident of Iranian surrender he mocked British preparations for the deployment of aircraft carriers to the Middle East.

“The United Kingdom, our once Great Ally, maybe the Greatest of them all, is finally giving serious thought to sending two aircraft carriers to the Middle East,” President Trump declared on March 8. The humiliating Truth Social post appeared to be influenced by rash thinking.

“That’s OK, Prime Minister Starmer, we don’t need them any longer — But we will remember. We don’t need people that join Wars after we’ve already won!” President Trump ridiculed the British. Reference to the UK as a ‘once great ally,’ underscored the US-UK rift.

But several days later, Trump sought deployment of other navies, including that of the UK to break the Iranian blockade on Hormuz Strait.

Modi phones Pezeshkian

Had the Israeli-US project achieved its primary objective, namely regime change, Indian Prime Minister Narendra Modi wouldn’t have had to eat humble pie after declaring solidarity with Israel, just a few days before the unprovoked war. Prime Minister Modi, on March 12, nearly two weeks after the killing of Supreme Leader Khamenei, phoned Iranian President Masoud Pezeshkian.

Modi had no option but to get in touch with the post Khamenei Iranian leadership amidst growing turmoil in the country over disruption of vital gas and fuel supplies. India made its move as the US declared that New Delhi could turn to Russia for the time being. India desperately needed oil and required them as quickly as possible.

Having elevated India-Israel partnership to the highest level in the wake of Modi’s late February 2026 visit to Tel Aviv, on the eve of the unprovoked attack to decapitate the Iranian leadership, India found itself in an unenviable situation. The two-day visit led to what the two governments called “Special Strategic Partnership for Peace, Innovation and Prosperity.” In other words, the Israelis must have been working overtime on war preparations while Modi and Indian External Affairs Minister Dr. Jaishankar were visiting the Jewish State.

Modi’s call and a couple of calls from Dr. Jaishankar to his Iranian counterpart Abbas Araghchi facilitated the passage of fuel carriers. The US must have been deeply upset by the Indian move but that ensured the BJP, in power since 2014, brought the situation under control for the time being. The truth is India had been compelled to negotiate with Iran and the latter wouldn’t have given assurance regarding safe passage for vessels carrying fuel for India without being adequately compensated.

After rushing to Israel to show their servile loyalty on the eve of launching the unprovoked attack on Iranians, the Indian-Iran deal, in the aftermath of that folly, for safe passage for New Delhi’s vessels, proved that there were limits to the world’s solitary superpower. In the run-up to Modi’s call to President Pezeshkian, the Indian leader came under heavy Congress fire over India’s failure to promptly condemn the assassination of the Iranian Supreme Leader. Initially, the Indian government acted as if Congress criticism were irrelevant but it had to appeal to Iran in the wake of the closure of the Strait of Hormuz.

Iran appeared to have exploited India’s difficulties. Having overlooked India-Israel/US partnership and the sinking of the unarmed Iranian frigate ‘Dena’ on 4 March, Iran’s Ambassador to India, Mohammad Fathali, on 13 March declared their readiness to grant safe passage through the Strait of Hormuz for vessels on their way to India.

Responding to a question from an RT India correspondent, the envoy highlighted that Tehran considered New Delhi as a friend and that there were converging interests between the two countries.

Asked directly whether India would receive safe passage through the Strait, he replied: “Yes, because India is our friend. You will see it within two or three hours.” (RT India is a New Delhi-based, English-language television news channel officially launched in December 2025 by Russian President Vladimir Putin).

At the time Israel-US unleashed war on Iran, India wouldn’t have anticipated such a scenario-direct negotiation with Iran to secure energy supplies and the US having to waive the ban on Russian oil sales. How would India-Iran deal on safe passage for energy carriers impact on India-Israel/US relations?

Sri Lanka, rattled by the developing situation, swiftly followed suit to explore the possibility of securing Russian oil. Russian Ambassador in Colombo Levan Dzhagaryan, on the invitation of the government, met Foreign Minister Vijitha Herath, at the Foreign Ministry, and assured the Minister Moscow would be informed. However, whether that meeting would produce results, as desired by Sri Lanka, is not yet known. But, Sri Lanka, trapped in the US Indo-Pacific strategy, seems utterly helpless as President Trump’s unprovoked gangster-type actions roiled the world. Ambassador Dzhagaryan, who had served as Russia’s top envoy in Iran, from 2011 to 2022, during a recent interview with the writer explained how the West sought to defeat Russia in Ukraine and the events leading to the Special Military operation in February 2022.

Gulf States in turmoil

Dzhagaryan

The stepped-up US naval build-up against Iran made it clear that a combined Israel-US offensive was inevitable. Against that background, the significance of an invitation received by the Colombo-based media to meet UAE Ambassador in Colombo, Khaled Nasser Al Ameri, in late February, this year, was realised only after the eruption of the war.

Ambassador Al Ameri, who had been here since February 2022, never called such a meeting before during 25 February dinner meeting at Cinnamon Life at City of Dreams discussed issues amidst rising tensions. The writer was among the invited along with Kesara Abeywardena, Editor, Daily News, and Nisthar Cassim, Editor, Daily FT. Perhaps the Ambassador felt the need to comprehend the pulse of the Colombo media due to the presence of a significant Sri Lankan community employed in his country.

The Gulf countries that accommodated US forces arrayed against Iran never expected Tehran to go the whole hog. Both the US and Gulf countries obviously miscalculated Iranian determination in the face of unprovoked aggression. They had to pay a very heavy price but none more so than the UAE. The Iranians shattered the myth of their invincibility due to the deployment of costly US armaments.

Paula Hancocks reported for CNN on 10 March that more than 1,700 missiles and drones had been fired towards the UAE since the war began. Quoting the UAE Defence Ministry, Hancocks said that more than 90% of them had been downed by interceptors, fighter jets and helicopters.

President Trump admitted in an interview with CNN’s Jake Tapper recently that Iran’s willingness to strike its Arab neighbours had been his biggest surprise of the war. But, faced with relentless Israeli-US offensive, Iran couldn’t have endured the pain without inflicting losses on all those arrayed against the country. The Iranian reaction must be examined taking into consideration the killing of the country’s Supreme Leader, some of his family as well as top military leaders.

The US-led coalition will eventually overwhelm Iran but the rapidity with which that country hit back even after losing the top leadership may embolden those opposed to US strategies. That is the undeniable truth. The latest Israeli and US claims of targets taken out in Iran cannot be discussed without taking into account their claims last June. During the 12-day war against Iran, Israel and US launched massive attacks but the retaliatory campaign launched by Iran after 28 February onslaught proved that debilitating losses couldn’t be inflicted by air campaigns alone.

UAE and others had learnt a bitter lesson by being part of Israeli-US strategy meant to overwhelm Iran. They had proved that Iran couldn’t be subdued the way the US succeeded in Venezuela in January this year. Venezuela appeared to have reached a consensus with the US following the abduction of its President Nicolas Maduro. The speed the new Venezuela leadership switched its allegiance to the US is not surprising though disappointing.

“I thank President Donald Trump for the kind willingness of his government to work together,” Rodríguez posted on X on 5 March, in perhaps her most shameless act of kneeling since Maduro’s abduction. But, in Iran, the attempted regime change operation in spite of it being overwhelming with superior firepower had been thwarted by that country. Their retaliation has exposed the weakness in the overall US-led defence of what can be termed Gulf Arab countries.

The recent relocation of a significant part of the US anti-missile system deployed in South Korea, particularly to meet the nuclear armed North Korean threat underscored the inadequacy of overall defence of the region at the time Israel-US attacked Iran. Foreign media reported South Korea protesting against the US move though it couldn’t interfere in the US action.

Status of Iranian proxies

The Lebanese armed group Hezbollah reached a ceasefire agreement with Israel in November 2024, following year-long clashes. In spite of the ceasefire, according to international media, Israel continued military presence in that country and there were numerous ceasefire violations. However, Hezbollah largely abided by the ceasefire until the assassination of the Iranian Supreme Leader.

Hezbollah resumed large scale attacks on Israel following the 28 February attacks. Combined Iran-Hezbollah attacks on Israel caused significant trouble. Israel launched retaliatory strikes and expanded ground operations in Lebanon where over a million people were displaced amidst massive destruction of infrastructure.

The French offer to arrange direct talks between Israel and Lebanon to find a lasting solution to the developing crisis seems irrelevant as long as Israel-US action continues against Iran. The issue at hand is the Israel’s desire to obliterate Iran with US support. US media, particularly CNN, reported how the American public resented the expanding US role in the conflict, with Trump issuing contradictory statements regarding US objectives.

Hamas, whose October 2023 raid on Israel resulted in the ongoing conflict, appeared to have surprised Iran with its recent plea to Tehran not to attack Gulf Arab countries in retaliation for Israeli-US aggression. Iran simply ignored Hamas appeal.

Iran should be held responsible for pursuing destructive strategy in the region by sponsoring Hamas in Gaza, Hezbollah in Lebanon and Houthis in Yemen. The Israeli military action that followed the unprecedented October 2023 Hamas raid that caused well over 1,000 Israeli deaths weakened all Iran backed groups. Iran, in a way, used these groups as a buffer against the Jewish State. Lebanon, too, is a victim of Iranian strategy that empowered Hezbollah to take on Israel. US backed Israeli actions cannot be discussed under any circumstances turning a blind eye to Iranian funding of Hamas, Hezbollah and Houthis fought back in whatever way possible. People have forgotten President Ranil Wickremesinghe’s ridiculous declaration in late December 2023 that he would deploy an Offshore Patrol Vessel (OPV) in the Red Sea in support of US-led efforts to counter Houthi attacks on the vital shipping lane.

In spite of reports and claims of the Sri Lanka Navy sending an OPV there, actual deployment never took place. Sri Lankan vessels are not equipped to face possible missile and drone threats and in case of deployment would have been vulnerable to Houthi such attacks.

 

By Shamindra Ferdinando

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Midweek Review

Digital Transformation in the Global South: Understanding Sri Lanka through India AI Impact Summit 2026

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Artificial Intelligence has rapidly moved from being a specialised technological field into a major social force that shapes economies, cultures, governance, and everyday human life. The India AI Impact Summit 2026, held in New Delhi, symbolised a significant moment for the Global South, especially South Asia, because it demonstrated that artificial intelligence is no longer limited to advanced Western economies however can also become a development tool for emerging societies. The summit gathered governments, researchers, technology companies, and international organizations to discuss how AI can support social welfare, public services, and economic growth. Its central message was that artificial intelligence should be human centered and socially useful. Instead of focusing only on powerful computing systems, the summit emphasised affordable technologies, open collaboration, and ethical responsibility so that ordinary citizens can benefit from digital transformation. For South Asia, where large populations live in rural areas and resources are unevenly distributed, this idea is particularly important.

One of the most important concepts promoted at the summit was the idea of “people friendly AI.” This means that artificial intelligence should be accessible, understandable, and helpful in daily activities. In South Asia, language diversity and economic inequality often prevent people from using advanced technology. Therefore, systems designed for local languages and smartphones play a crucial role. When a farmer can speak to a digital assistant in Sinhala, Tamil, or Hindi and receive advice about weather patterns or crop diseases, technology becomes practical rather than distant. Similarly, voice based interfaces allow elderly people and individuals with limited literacy to use digital services. Affordable mobile based AI tools reduce the digital divide between urban and rural populations. As a result, artificial intelligence stops being an elite instrument and becomes a social assistant that supports ordinary life.

Transformation

The influence of this transformation is visible in education. AI based learning platforms can analyse student performance and provide personalized lessons. Instead of all students following the same pace, weaker learners receive additional practice while advanced learners explore deeper material. Teachers are able to focus on mentoring and explanation rather than repetitive instruction. In many South Asian societies, including Sri Lanka, education has long depended on memorisation and private tuition classes. AI tutoring systems could reduce educational inequality by giving rural students access to learning resources similar to those available in cities. A student who struggles with mathematics, for example, can practice step by step exercises automatically generated according to individual mistakes. This reduces pressure, improves confidence, and gradually changes the educational culture from rote learning toward understanding and problem solving.

Healthcare is another area where AI is becoming people friendly. Many rural communities face shortages of doctors and medical facilities. AI-assisted diagnostic tools can analyse symptoms or medical images and provide early warnings about diseases. Patients can receive preliminary advice through mobile applications, which helps them decide whether hospital visits are necessary. This reduces overcrowding in hospitals and saves travel costs. Public health authorities can also analyse large datasets to monitor disease outbreaks and allocate resources efficiently. In this way, artificial intelligence supports not only individual patients but also the entire health system.

Agriculture, which remains a primary livelihood for millions in South Asia, is also undergoing transformation. Farmers traditionally rely on seasonal experience, but climate change has made weather patterns unpredictable. AI systems that analyze rainfall data, soil conditions, and satellite images can predict crop performance and recommend irrigation schedules. Early detection of plant diseases prevents large-scale crop losses. For a small farmer, accurate information can mean the difference between profit and debt. Thus, AI directly influences economic stability at the household level.

Employment and communication

Artificial intelligence is also reshaping employment and communication. Routine clerical and repetitive tasks are increasingly automated, while demand grows for digital skills such as data management, programming, and online services. Many young people in South Asia are beginning to participate in remote work, freelancing, and digital entrepreneurship. AI translation tools allow communication across languages, enabling businesses to reach international customers. Knowledge becomes more accessible because information can be summarised, translated, and explained instantly. This leads to a broader sociological shift: authority moves from tradition and hierarchy toward information and analytical reasoning. Individuals rely more on data when making decisions about education, finance, and career planning.

Shared conditions

The impact on Sri Lanka is especially significant because the country shares many social and economic conditions with India and often adopts regional technological innovations. Sri Lanka has already begun integrating artificial intelligence into education, agriculture, and public administration. In schools and universities, AI learning tools may reduce the heavy dependence on private tuition and help students in rural districts receive equal academic support. In agriculture, predictive analytics can help farmers manage climate variability, improving productivity and food security. In public administration, digital systems can speed up document processing, licensing, and public service delivery. Smart transportation systems may reduce congestion in urban areas, saving time and fuel.

Economic opportunities are also expanding. Sri Lanka’s service based economy and IT outsourcing sector can benefit from increased global demand for digital skills. AI-assisted software development, data annotation, and online service platforms can create new employment pathways, especially for educated youth. Small and medium entrepreneurs can use AI tools to design products, manage finances, and market services internationally at low cost. In tourism, personalized digital assistants and recommendation systems can improve visitor experiences and help small businesses connect with travelers directly.

However, the integration of artificial intelligence also raises serious concerns. Digital inequality may widen if only educated urban populations gain access to technological skills. Some routine jobs may disappear, requiring workers to retrain. There are also risks of misinformation, surveillance, and misuse of personal data. Ethical regulation and transparency are therefore essential. Governments must develop policies that protect privacy, ensure accountability, and encourage responsible innovation. Public awareness and digital literacy programs are necessary so that citizens understand both the benefits and limitations of AI systems.

Beyond economics and services

Beyond economics and services, AI is gradually influencing social relationships and cultural patterns. South Asian societies have traditionally relied on hierarchy and personal authority, but data-driven decision making changes this structure. Agricultural planning may depend on predictive models rather than ancestral practice, and educational evaluation may rely on learning analytics instead of examination rankings alone. This does not eliminate human judgment, but it alters its basis. Societies increasingly value analytical thinking, creativity, and adaptability. Educational systems must therefore move beyond memorization toward critical thinking and interdisciplinary learning.

In Sri Lanka, these changes may contribute to national development if implemented carefully. AI-supported financial monitoring can improve transparency and reduce corruption. Smart infrastructure systems can help manage transportation and urban planning. Communication technologies can support interaction among Sinhala, Tamil, and English speakers, promoting social inclusion in a multilingual society. Assistive technologies can improve accessibility for persons with disabilities, enabling broader participation in education and employment. These developments show that artificial intelligence is not merely a technological innovation but a social instrument capable of strengthening equality when guided by ethical policy.

Ultimately, the India AI Impact Summit 2026 represents a symbolic shift in the global technological landscape. It indicates that developing nations are beginning to shape the future of artificial intelligence according to their own social needs rather than passively importing technology. For South Asia and Sri Lanka, the challenge is not whether AI will arrive but how it will be used. If education systems prepare citizens, if governments establish responsible regulations, and if access remains inclusive, AI can become a partner in development rather than a source of inequality. The future will likely involve close collaboration between humans and intelligent systems, where machines assist decision making while human values guide outcomes. In this sense, artificial intelligence does not replace human society however transforms it, offering Sri Lanka an opportunity to build a more knowledge based, efficient, and equitable social order in the decades ahead.

by Milinda Mayadunna

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Midweek Review

‘Conversational reading’ with children

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Enhancing Sensibility

In our contemporary culture, we have lost our age-old tradition of intergenerational transmission of stories through spoken word, and our children have lost their romance with the printed word. These were the observations made by several learned contributors to this journal in recent times. In this context, I was interested in reading the informative article titled, ‘The Art and Science of Communicating with Your Little Child’ [The Island, March 5, 2026] by senior Paediatrician Dr. B. J. C. Perera, in which he underscores the significance of meaningful communication of children, mostly with their parents, in designing the ‘architecture of their minds’, a task which cannot be served by apps, vocabulary flashcards, or educational television. Dr. Perera, has drawn a consilience between science and sensibility.

While acknowledging the developmental benefits of appropriate social interactions, stories listened to and read by children in their formative years, I wish to address the allied topic of conversational reading [also known as dialogic or interactive reading] which provides a wider area of growth and sensibility. Not pretending it to be a novel idea, I write with the hope of raising the awareness of parents, grandparents and teachers alike, of the wider scope of the topic, in view of recent research of its developmental benefits for children,

Nowadays, children spend countless hours immersed in electronic media [e. g. smart phones, social media, gaming etc.] without guidance from parents who are occupied with busy work schedules. Children have less time for reading outside the school curriculum and to have a meaningful dialogue. While not denying the immense benefits of technological advances, social media mainly provide sensation and impression, offering less depth and complexity of thought. They also provide an escape from a ruthlessly competitive education system with tuition outside school hours and burdensome homework. It is now becoming increasingly evident that overindulgence in social media use has the potential to cause pervasive detrimental effects on children relating to their emotional stability, impulse control, sleep pattern and interpersonal skill.

Before embarking on the subject of Conversational Reading and its developmental benefits, I wish to briefly address the topics of intergenerational storytelling and reading.

Intergenerational Story-telling

The tradition of intergenerational storytelling is a universal exercise, perhaps dating back to the development of language itself. Typically, stories are told for transferring information or education or for entertainment. Early humans such as the Aboriginal People of Australia, who lived before the development of the written word, story-telling by tribal elders [‘knowledge keepers’] was the primary mode of transmission of knowledge, values and life lessons. It was a powerful tool for education, intertwined with art, songs and dances, fostering beliefs about creation, ancestral spirits, and connection to the land. The stories helped to pass down generations, a sense of cultural identity and the need to live in harmony with each other and with the environment.

Story-telling through Printed Word

Following the development of the written word by Sumerians in Mesopotamia around 3500 – 3200 BCE and printing on paper by the Chinese in 868 CE, stories were delivered to some extent through the printed word. The first printed children’s story on paper, ‘Orbis Sensualium Pictus’ [The World of Things Obvious to the Senses drawn in Pictures’] published in 1658 by John Amos Comenius, the Czech educator, was an educational book with illustrations that inspired joyful learning in children. Since then illustrated story books were marketed for pleasure reading. Combining pictures with words became a delightful way to tell a story, as in the fairy tales by Hans Christian Andersen, Alice’s Adventures in Wonderland by Lewis Carroll and The Tale of Peter Rabbit by Beatrix Potter. Stories were presented in both prose and verse.

We Sri Lankans are endowed with a wealth of children’s literature pioneered by such literary figures as Kumaratunga Munidasa, Ananda Rajakaruna, Tibetan [Sikkimese] monk Rev. S. Mahinda, V. D. De Lanarolle, Piyadasa Sirisena, G.H. Perera and others. They transformed folk tales into prose and poetry for supplementary reading. Edwin Ranawaka translated children’s stories from English to Sinhala with modifications to suit the local readership. They were men of vision who inspired the young with their literary work aimed at enhancing their creativity, sensitivity and tranquillity to prepare them for the challenges of the future. Our literary icon, Martin Wickremasinghe, was ahead of his time in recognising the importance of children’s literature and its positive impact on their psychosocial and intellectual development. In his book ‘Apey Lama Sahithyaya’ [Our Children’s Literature] in the immediate post-independent era he made the astute observation that a nation without children’s literature rooted in its heritage may face intellectual and moral decline. Wickremasinge regretted that despite the above contributions, we have been slow in developing a children’s literature of our own, although such a literary genre has long been established in the west.

I apologise for not being able to add to the above any Tamil authors of children’s stories due to my lack of knowledge.

Regular exposure to reading books has a long list of benefits for children: reading expands exposure to language and new vocabulary, builds foundational skills such as prediction, sequencing, and summarising, and introduces characters and worlds far beyond a child’s family or neighbourhood. Reading is a powerful technique in broadening social, emotional and cognitive development of children.

Conversational Reading

Recent research in childhood education and psychology has shown that conversational reading with children in their early formative years [in the main the pre-primary and primary school years] can both broaden and deepen the already known developmental benefits of the reading experience.

Conversational reading is the art of reading to and reading with children of an age appropriate piece of prose or verse by an adult, in a two way interactive process, exploring their thoughts and feelings about what is read and helping them to articulate their views within their capacity. It is fundamentally different from simply reading the words in a book to a child. It promotes the use of open-ended questions to create conversations while reading. In this dynamic, the child and the adult [parent, grand-parent, or teacher] contribute to the conversation in equal parts. Conversational reading in the school setting with a group of children offers greater benefits as it encourages discussion amongst them.

Research findings on conversational reading shows a wide range of developmental benefits – cognitive, emotional, and social.

Significant improvements in language development, especially in the areas of expressive vocabulary, word acquisition and sentence structure through modelling and meaningful conversations.

Such meaningful conversations enhance reading comprehension by reflection on characters and events and encourage critical thinking by looking beyond the narrative. Their active participation increases their imagination and creativity and their motivation to read.

Children being active participants, rather than passive listeners, improve their communication skills and encourage respectful discourse and help raise their self-esteem.

It enhances social and emotional understanding through exploration of feelings and relationships, being insightful of others’ perspectives and the development of empathy.

It enables strengthening of emotional bonds with adults through meaningful dialogue.

It is a joyful exercise that facilitates learning.

Reading with children and talking with them about what matters is more important than ever before. Reading fluency, comprehension, and ability to relate the ideas in a story to yourself and the wider world are the building blocks of imagination, empathy, critical thinking, and creativity—all crucial qualities which give children the ability to better understand themselves and others and to find their place in the world.

by Dr Siri Galhenage,
MBBS, DPM, MRCPsych, FRANZCP
Psychiatrist [Retd]

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