PMD accuses JVP of disseminating fake news

Colombo Port East Terminal:


Deputy Director (International Relations and Foreign Media President’s Media Division) of the President’s Media Division Shivanthi Ranasinghe has sent us the following response to our news item by Udara Karunadasa, ‘JVP not happy with India developing East Terminal of Colombo Port’:

"The Island of 24 May, quoted the JVP "India has re-launched the project to acquire the East Terminal of the Colombo Port, while Sri Lanka is facing severe economic hardships, due to the COVID-19 pandemic". The statement made by Former MP Ratnayake, as reported by Karunadasa, is completely false. Indian Prime Minister Narendra Modi, as charged by Ratnayake, did not seek to acquire the Colombo Port East Terminal. The Indian Premier certainly did not try to take undue advantage from Sri Lanka’s prevailing economic woes, as insinuated by this statement. Furthermore, Ratnayake is mistaken when he stated that the subject was out of context.The events that actually transpired were, President Gotabaya Rajapaksa requested from the Indian Premier to "direct those responsible from India’s side to expedite construction of the East Terminal of Colombo Port as early as possible as it will be a significant boost to our economic landscape."On May 24, President Gotabaya and PM Modi had a very constructive and cordial dialog over the telephone. The discussion centered on the ongoing COVID-19 global pandemic. PM Modi noted that it had not been easy to manage the crisis with a population of more than 1.3 billion. However, said the Premier, presently about 75 percent of the spread of the virus in India has been contained.He also highly commended President Gotabaya for Sri Lanka’s success in managing the crisis. He observed that it was because President Gotabaya worked with a clear vision and took tough and timely decisions.As the pandemic for both countries has now moved from crisis stage to a more manageable level, the focus of the two leaders was on rebuilding the economy.Sri Lanka especially has been hard hit because the economy before the outbreak of the virus itself was in a very bad shape.

"The Yahapalana Government for want of a cohesive economic vision, presented nine different economic policies within three years. As economic confusion reigned in, that government was unable to arrest the unprecedented depreciation of the LKR, which fell by 33 percent; nor was it able to attract new investors. Existing investments too stagnated.As a result, the construction industry collapsed. Nearly half a million had lost their livelihood before the Easter Sunday massacres, after which the tourism industry collapsed. Taxes doubled and the National Debt increased by nearly seven trillion rupees, yet without adding any assets or return of investments into the economy. The GDP fell to the lowest in the region and at 2.3 percent was only slightly above the war torn Afghanistan.President Gotabaya came to Office with a clear plan to rebuild the economy. Even during the height of the COVID-19 crisis, President never lost sight of his economic strategy. Hence, even when supply chains got disrupted and market demands dwindled, President was able to keep the economy afloat.However, it has not been a smooth ride.

"By around the third week of the lockdown, LKR hit a new record low against the USD as the selling rate closed on Rs 200.47. Overall exports dropped by 42 percent to USD 646 million compared to the USD 1,120 million the previous year. Worker remittances in March was down by 14 percent to USD 492 million. One by one, international rating agencies downgraded Sri Lanka in terms of credit worthiness.However, instead of letting the LKR settle at this rate or allow it to fall further, the Administration worked hard to reverse the situation.

"Today, the selling rate of LKR per USD is hovering between Rs. 189.00-188.00. CSE, after been closed for more than seven weeks is now functioning and gradually gaining. As the Finance Ministry noted, the downgrading by the rating agencies was a rushed judgement.This remarkable recovery was achieved through strict discipline in managing the finances and a clear plan to return to normalcy. All imports that are not essential for the moment has been stopped. An incentive package was offered by the Central Bank to Sri Lankan expatriates who will repatriate FOREX for the coming months.

"These moves eased the pressure off the LKR.At the same time, emphasize was given to domestic production. Milling of rice was made an essential service. Small and medium sized rice millers, who had not defaulted on their bank commitments, were also provided with financial assistance.With the lockdown, most of the economic activities ground to a halt. The leisure industry, the manufacturing and service sectors are facing severe setbacks.Yet, throughout this difficult period, the agrarian sector was supported. Early May, the Cabinet decided to establish a ‘aswenna’ agricultural loan scheme for up to Rs 3 million for specific crops. It was also decided to establish 200 export-oriented cluster villagers, 50 ‘green gardens’ and use 10,000 acres to cultivate ‘toxin-free’ crops. National Fertilizer Secretariat also released fertilizer to begin the Yale cultivation season.Since May, focus has also broadened to include the construction industry.

"Work on the Broadlands Hydro Power Plant (35MW) has resumed and is expected to be completed in December 2020. It is expected to generate 126Gwh and an annual saving of Rs. 3.7 billion.In this global pandemic, reviving the economy whilst containing the virus is not two separate projects, but the two parts of the same project. With the lockdown easing off in Sri Lanka and the economy gradually opening up, the incumbent Administration is clearly kick-starting the comatose construction industry as its next step.Therefore, President Gotabaya seeking PM Modi’s intervention to revive some of the key projects, including completing the construction of the Colombo Port’s East Terminal, was well within the context of their telephone conversation.

"Apart from these projects, President also requested from PM Modi to "encourage Indian investors" and "Indian companies already in Sri Lanka to increase domestic value addition," in support of President’s plans "to promote value added industrial and agricultural activities."

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