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Reconciliation Initiative- the bigger picture

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­By Dr Nirmala Chandrahasan

It has been announced that the government of Sri Lanka is on a reconciliation initiative. In pursuance thereof, President Wickremesinghe has invited all Tamil MPs for talks next week to discuss issues faced by the Tamil people and how to resolve them amicably without outside interference before the 75th Independence Day. This is Indeed a laudable project, although some sceptics have described it as being due to the result of relentless pressure from outside and future international economic assistance and support being tied to the resolution of this issue. If this is true then it is all the more important that it be approached in a way which goes to the root of the problem and brings the ethnic parties together again in friendship and harmony, which is what reconciliation means.

President Wickremesinghe has mentioned certain subjects for the discussion which include the release of prisoners presumably those held in respect of the civil war, issues pertaining to truth and reconciliation again presumably those arising from the civil war. The list also includes development plans for the North and East which includes assessment of renewable energy potential in the North, and finally development of Trincomalee for Tourism.

Although the above are all worthy objectives, it fails to deal with the subject of reconciliation per se. Reconciliation means restoring friendship and harmony between parties who have been divided, and would include settling or resolving the differences between them. To my mind the most important question to be resolved is whether this Country is to be regarded as a Sinhala Buddhist State where all the other ethnic, religious groups are treated as guests, or as a multi- ethnic- multi-religious, secular country where all citizens have equal rights.

During the previous regime of President Gotabaya Rajapaksa, it was publicly asserted to be a Sinhalese Buddhist state where other ethnic and religious entities were being allowed to live. This ideology was propounded by ethno-nationalist Sinhalese politicians, academics and media houses. The sole Sinhalese Politician of Stature who was brave enough to repudiate this claim was the late Mangala Samaraweera. He had to bear the consequences of stating that the country belonged to all the ethnicities and religious groups and was denigrated by ethno- nationalists. Even today this policy continues in the Eastern province, where under the pretext of Archaeology, and Buddhist ruins, Tamil speaking farmers of the area are being dispossessed of their lands, although historically many of these ruins are Tamil Buddhist ruins. In the Trincomalee district, administrative boundaries are being sought to be changed so as to make demographic changes to the population of the district. All these actions are analogous to those of Israeli settlements in Palestinian lands, and is only breeding bad blood between the communities, instead of reconciliation. It is also noteworthy that the Archaeological Task force for the Eastern province appointed during the previous regime does not contain a single member of either the Tamil or Muslim communities who constitute the majority in this Province. The above actions would call in question the credibility of the present reconciliation process to even the international observers, and should be discontinued.

This claim that the island belongs only to one ethnic religious group, is not entirely new, although it was given a public endorsement in the regime of President Gotabaya. From 1949 itself with the passing of the Acts disenfranchising the upcountry Tamils and the passing of the Sinhala only Act in 1956, this policy began to reveal itself. There were also pogroms against Tamil speaking people from 1956 onwards, culminating in the pogrom of 1983 which was said to be state inspired and directed. In the aftermath of the 1983 holocaust, the non-violent Satyagraha methods which had marked the earlier Tamil political resistance movement came to an end as people began to doubt its efficacy.

I might add that in my view, it was not the Sinhalese people who were responsible for this policy and the consequences thereof, but self-serving politicians and members of a political class, who found a path to power, position and wealth by espousing this ideology and deceiving their own people. It was this ideology that resulted in Sri Lanka losing so many of its professionals and talent, as sections of the population began to feel that they had no place in this Country. First the Burgher community which had made this their home since the 17th century, emigrated to Australia, subsequently many Tamil professionals who had skills that could benefit the country left for the UK, USA, Canada, Australia, and other first world countries. After the major pogrom of 1983, there was an outflow of Tamil refugees who had suffered the effects of the violence, to all parts of the world. The armed struggle also began to take shape, as the military repression caused many young people of the Tamil community to join the ranks of the militants and take up arms because they did not see themselves as equal citizens in this nation. All these factors had a bearing on the present catastrophic economic downturn which we now see. This of course is not the only reason as the incompetence and corruption of the rulers and the political class was also a major factor.

So, we can see that for true reconciliation to take place there must be a recognition that this Country is a Multi- ethnic, multi- religious country in which all citizens are equal and have an equal stake. We must welcome and be proud of our diversity as do countries like Canada and South Africa. Even in the United Kingdom our former colonial ruler, a Hindu of Indian origin is able to take his place as Prime minister. The British Conservative party has chosen to give recognition to ability and talent and not race or religion. We have to look to the day when the Sri Lankan nation will do likewise. In a country where all the citizens of diverse ethnic and religious backgrounds are accepted as equal partners, all the constituent peoples would be enthused to work together for the upliftment of ‘their’ country. The Tamil diaspora too would come forward to assist and invest in the Country. For this change of heart /mindset to take place there must be a revamp of the text books in the schools and particularly in the- Sinhalese medium. History books must show the common cultural links between the communities and not portray them in an adversarial way. The historical linkages between the South Indian kingdoms and Lanka should be brought out. The fact that South India was Buddhist too for many centuries, and the Chola Kings who ruled Lanka for almost a century were also patrons of Buddhism should be made known to the public, both Sinhalese and Tamil, as Tamils too are largely unaware of the common heritage they share.

It also behoves the Tamil community to move away from a mindset of victimisation and constant harping on the Civil war. Every war has its brutalities and crimes and these are not confined to one party alone. The Tamil community has to look to the future and while safeguarding their culture and identity they also have to break away from their insularity. Where the hand of friendship and reconciliation is genuinely extended, they should take it and go forward. We might take a lesson from the civil war in the USA, between the Northern States of the Union and the Southern states in the 1860s. Here too the Southern states, (the Confederacy) tried to secede from the Union and form their own state. The war that followed was a very brutal one. It is said that the northern Army of General Sherman followed a scorched earth policy while marching through the Southern states. But once the war was over and the North had won, the Union government followed a policy of Reconciliation. In the National War Memorial in Arlington Virginia, there is a memorial to the Confederate soldiers of the South too, thus honouring the dead on both sides. The reunited USA, a Federal state, went on to become a great power and one of the most prosperous nations in the world. In Sri Lanka too as a measure of reconciliation some memorial to those who died fighting for their cause would go a long way in assuaging the feelings of their relatives and friends, rather than the policy of destroying their cemeteries and preventing their family members from remembering them, as hitherto. The release of the prisoners who participated in the Civil war, some of them still imprisoned, while awaiting trial after so many years, is a good beginning, as too the idea of a Truth and Reconciliation commission which is being envisaged.

Next, I would also like to touch on the question of sharing of powers, as a necessary constituent of reconciliation. Since the Indo- Sri Lanka peace Accord of July 1987, there has been a process of putting in place a system of Devolution of powers. This Treaty gave recognition to the Tamil people as Historical inhabitants of the Northern and Eastern Provinces and provided for a system of devolution of powers through Provincial Councils. Under the 13th Amendment to the Constitution and the Provincial Councils Act the Provincial Councils were set up. Under the 13th Amendment, powers are given in respect of a wide spectrum of subjects, which are set out in the annexed Lists and Annexures. However, the Provincial Councils Act stultified many of these powers by giving the Governor control of Finances and the Provincial administrative services. Furthermore, the Central Authorities kept encroaching on the subjects allocated to the Provincial Councils. Hence the Provincial Councils have not been as effective as they might have been. This has given rise to the view expressed by some persons including Tamil politicians that the Provincial Council system is not workable, and should hence be done away with. To this, it must be pointed out that since independence seventy-five years ago the Tamil parties have been agitating for some measure of power sharing while seeing a federal Constitution as the ultimate goal. This agitation has been through Parliament and through peaceful ‘satyagrahas’, and through negotiations and pacts with Sinhalese majority Parties and Governments. Finally, the militants having lost faith in negotiations took up arms and a protracted civil war of almost 30 years ensued. But for all this the only political gains in the way of power sharing and devolution that the Tamils have obtained has been the Provincial Councils and that too through the good offices of the Government of India.

Hence good sense dictates that the Tamil political leaders make the best use of what they have in hand. With the ongoing reconciliation process, they could press for the necessary amendments to be made to the Provincial Councils Act, which could be done through legislation with a simple majority in Parliament, or a two third majority where some Provincial Councils do not agree to the changes. No Referendum is required Furthermore, it must be conceded that the Northern Provincial Council could have exercised greater authority and made more progress by making use of the powers to pass statutes on subjects allocated to the Councils, which I might point out the Northern Province Council as of date has been very remiss in doing. Even in the matter of spending funds allocated to it by the Centre the Council has been remiss and even returned such funds in some instances. So in my view, with greater commitment on the part of the stakeholders a more efficient administration can be ensured, once the necessary amendments are put in place.

The alternative is to return to the long-drawn-out process of endless negotiations and drafting committees. After the passing of the legislation in 1987, efforts to make improvements and changes were many, i.e. the Mangala Moonesinghe committee report in the 1990s, the Chandrika Bandaranaike Kumaratunga draft Constitution of 2000, which was incidentally the closest to a federal form of Government. Again in 2006 there was a multi -ethnic expert Committee appointed under the Mahinda Rajapaksa government which presented a report which was not implemented, next the APRC, (All Party Representative Committee) Report 2010, was shelved by the Government. With the change of Government in 2015 it was sought to revive the process and in 2016 a Constituent Assembly was formed to work on a new Constitution. Speaking on the recent reconciliation proposals Mr. Sumanthiran, MP on behalf of the TNA said that President Wickremesinghe had presented a draft of the new Constitution proposals to Parliament on 16th January 201 9 in the capacity of Prime minister, and this has to be taken forward. This is a sensible proposal as it is not worth restarting the same process again. I might mention that the Parliamentary Sub- Committee on Centre-Periphery relations, which was part of the above Constituent Assembly, made some very good proposals on the reforms to the Provincial Council system in its Report of 2019, which incorporated proposals in the 2006 Expert Committee Report and the APRC Report, and these can be drawn upon when making the amendments to the Provincial Councils Act, as proposed above.

With a view to making reconciliation a reality and restoring friendly relations and harmony between the communities, I have examined the background to, and underlying ideologies which have contributed to the estrangement between the communities. The strategies and steps to be taken in order to change perceptions and fixed prejudices and ideologies will require courage and transformational steps some outlined above. Reconciliation cannot be a one sided effort and both communities must be willing to make the effort. President Ranil Wickremesinghe is well suited to taking this process forward given his long experience of the political processes and understanding of the historical background.



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Opinion

Electricity tariffs have skyrocketed: Can further increases be prevented?

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Contrary to the current government’s election promise to lower the electricity bill by 33%, electricity tariffs have been further increased by 18%, with effect from 11 May, 2026. A cosmetic concession has been given to the consumers with a consumption less than 180 units per month. However, they are already subject to the 10% increase already granted on 01 April, 2026. The subsidy of Rs 15 billion granted by the Treasury to enable this concession is highly questionable; it is a clear case of misleading the public. The subsidy of Rs. 15 billion is not a gift from Heaven, but is from public funds, which could have been used for other sectors which deserve assistance.

This was also the case prior to the IMF insisting that the electricity tariff should be cost-reflective. The then CEB wasted nearly a trillion rupees of treasury funds (read funds belonging to the people) over the past decade by adopting wasteful and ill-conceived generation options and other activities in the name of generating low-cost electricity.
Unfortunately, the IMF did not impose the essential condition that CEB should follow the concept of Least Economic Cost of Generation in selecting the generation mix.
The CEB’s persistent refusal to accept this principle and act thereon has been the main reason for the spate of increases in electricity tariff for the last several years as shown. (See Table 1)

This does not include the increases in April and May

The Public Utilities Commission of Sri Lanka (PUCSL) has sought to lower tariffs in some instances, but it has failed to reverse the trend.

There were vehement protests by all concerned during the public hearing held on 6 May 2026 against any kind of tariff increase, which naturally would have grave negative ramifications on peoples cost of living and all other sectors of the economy. The numbers presented by the National System Operator (NSO), successor to the now defunct CEB were highly criticized as inaccurate and designed to deceive the public and presented only to say support their claim for the tariff increase.

Most critically, the question of the required supply of coal, especially the substandard variety currently being used, was questioned. Given the onset of monsoons, it is doubtful whether even the emergency supplier can deliver 330,000 MT of coal to meet the supply shortfall at higher prices. The original supplier failed to deliver the last five shipments.

As such, it is now very likely that there will be a shortage in the electricity supply in the coming months. In addition, the NSO in its submission has predicted an increase in demand of 118 GWh during the next quarter. What is the plan of NSO to meet this demand? Will it try to meet the shortfall by increased use of oil, resorting to the much-dreaded Emergency Purchases as done previously? If that is the case, there will be another demand for a tariff increase in September 2026 to cover the additional costs.

Hobson’s Choice for PUCSL

However, the writer, taking a pragmatic view that the PUCSL, is faced with the difficult position of ensuring that the NSO is able to function and to maintain the national electricity supply, the breakdown of which is unfathomable, proposed that some increase in tariff in the present instance was inevitable, however, distasteful and unpopular that would be. This is in light of the massive increase in the price of all forms of oil used for the power generation and the loss of generation capacity caused by the coal scam. It is not possible to accept a complete loss of the supply nor prolonged power cuts as happened in 2022. Neither the CEB nor its successor, the NSO, has been proactive in anticipating the current crisis in spite of many years of warnings of the danger of over dependence on imported fossil fuels which Sri Lanka has absolutely no control over where either price or supply is concerned. It is imperative that even at this late stage the NSO reverse this situation by reducing such dependence, as Sri Lanka now enjoys the means of filling that gap using economical and abundantly available indigenous sources of renewable energy such as Solar Wind and Biomass.

Therefore, I proposed that whatever tariff increase was granted be made strictly conditional to NSO acting swiftly to formulate plans fast to eliminate the use of any kind of oil for power generation.

Pragmatic approach of PUCSL

It is of great relief to the consumers and the county that the PUCSL has accepted this proposal and imposed the following conditions in granting the 18% tariff Increase to consumers over 180 units per month.

Conditions of PUCSL

1. NSO shall review its generation plan to eliminate the oil dependency of Sri Lanka energy mix by 2030 and to achieve the renewable energy targets, the generation plan to be ready by end 2026.

Several other measures have also been adopted to ensure that all licensees comply. It is imperative that President Anura Kumara Dissanayake realise that abiding by these conditions is the only way he can hope to deliver on his promise of reducing the consumer tariff.

Even though achieving the 33% tariff reduction will take some time, given that the baseline has shifted considerably upwards due the past tariff increases, the implementation of these conditions imposed immediately can arrest the dangerous trend of ever increasing consumer tariff. The President should be vigilant to prevent any attempts by interested parties to perpetuate the use of oil for power generation by sabotaging this much-delayed change, and perhaps by hiding behind some clause in the recently enacted Electricity Act. It will be in his interest to monitor the events closely, perhaps via the newly-appointed Secretary to the Ministry of Power and Energy.

PUCSL’s proactive role

The PUCSL has been proactive in this regard by foreseeing the need for
accelerated development and integration of solar PV as the fastest means of filling the gap created by the gradual elimination of oil use. It has already published a stagewise plan to achieve this goal by 2030

Furthermore, recognising that the change can be achieved by attracting private investment, the PUCSL is currently planning to publish Feed in Tariff (FIT) applicable for the integration of storage batteries to overcome the often repeated issue of variability and thereby the potential instability of the grid . It’s even more important that the correct size of these batteries will enable the ” Prosumers” to export the much-needed power to the grid during the peak hours.

The excessive use of the excessive diesel and other oils is needed mostly during the peak hours. It is feasible for this need to be filled by exporting solar and wind via battery storage. It is to be noted that a substantial amount of solar and wind energy is currently curtailed during the weekend daylight hours without compensation to the developers, claiming the supply is in excess of the demand. Moreover, the payments due to these developers have been delayed over several months now amounting to over Rs 10 billion. In the meantime, we have been paying for the use of oil imported with scarce foreign exchange.

We solicit the vigilance of the respective authorities,including the Presidential Secretariat, to ensure that no barriers are created by interested parties for the implementation of the PUCSL proposals.

In this regard, the issue of delayed payments to the Renewable Energy Developers should be resolved urgently as these are the very same developers who can contribute most speedily to implement the strategy proposed by the PUCSL.

The low hanging fruit

Taking a pragmatic view of the situation, one will see that even in a situation where all parties willingly and readily accept this strategy as the only way forward, there is much work to be done before the energy stored in batteries could be exported to the grid.

The fastest option is to permit the emerging new rooftop solar systems to
be developed coupled with batteries in the off-grid mode, which does not require the traditional grid integration.

They shall be permitted to join the system when smart meters are in place to enable such energy to be exported during the peak hours and also to implement the time of use (TOU) tariff system to pay only for the energy exported during this time slot only.

It is imperative that very urgent action be taken to effect these changes, with the installation of smart meters to consumers who require them. The current increase of 18% of the tariff to this class of consumers who are able to fund the solar PV plus batteries will enhance the financial feasibility of this move and therefore should be considered an incentive to do so although unintentionally. This is illustrated to be compared with the same analysis published in my previous article. (See table 2)

When the FIT for exports to the grid off the batteries are announced the saving would be much greater as there is a possible excess generation that can be exported to the grid during peak hours, further assisting the reduction of the need for diesel generation.

The NSO should also recognise the value of the contribution by this group of consumers as the energy consumed by them during the peak hours will no longer be drawn from the grid thus in effect reducing the need for use of diesel during this period.

Using the data submitted with the claim, it can be seen that Rs 6,287 million will be required to generate 51 GWh of electricity using diesel, presumably at the current price of Rs. 382 per litre. This relates to a cost of generation of Rs 122.60 per kWh accepted without contest. The income they would get per unit even after the 18% increase from this class of consumers would be Rs 100 per unit. As such, even if the cost of diesel remains at the present level which is most doubtful, the NSO will be able to save at least Rs 22.60 per unit of energy that is not supplied to these “Prosumers”

The PUCSL’s proposed plan to eliminate the use of oil stipulates that the use of diesel for power generation should be done only during the peak hours and should be eliminated in 2026. The installation of smart meters and implementation of the TOU tariff system will have to be completed fast to achieve this goal

However, the process of Prosumers installing systems in the off-grid mode will help as they would not use the grid during the peak hours. They may use the grid during the off-peak hours. But since at this stage the system is not grid-integrated there is no impact on grid stability and thus prior approval is not required. They are in a position to install these systems in anticipation of the proposed system of exports, and save on their monthly electricity bills while helping reduce the peak load. They will also be protected from any power cuts, which are looming.

As such, we expect the PUCSL as well the NSO to pressure Sri Lanka
Customs to allow the duty and other concessions granted by them at the point of imports large scale batteries of 1 MWh capacity to be granted to the smaller scale batteries of kWh scale which at present are subject to levies up to 47%, and this should be corrected forthwith to attract more “Prosumers”.

The condition imposed by the PUCSL on the recent tariff increase is fair and very pragmatic. It is time for the NSO to recognize its national duty and obligation to the people of Sri Lanka to think positively and overcome two decades of negative stance the CEB adopted much to the detriment of Sri Lanka’s interest.

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Opinion

Sri Lanka’s security imperative: Need for a strong NSC and lessons from the region

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Sri Lanka in 2026 finds itself at a dangerous crossroads. Its commanding position in the Indian Ocean should be a strategic asset, yet it remains a vulnerability. The civil war ended in 2009 and the economy has begun recovering from the 2022 crisis, but the island faces intensifying great-power rivalry, internal divisions, and new threats ranging from cyber attacks to climate disasters. The deepest problem, however, is home-grown: the chronic politicisation of intelligence and security institutions.

This deliberate distortion weakens threat assessment, destroys public trust, and leaves Sri Lanka ill-equipped to handle a turbulent region. The most practical remedy lies in establishing a robust, independent National Security Council (NSC) with real statutory power. India’s post-Kargil reforms offer compelling lessons on how institutional redesign can professionalise intelligence and strengthen sovereignty.

Geopolitically, Sri Lanka is trapped in the crosshairs of India-China-US competition. Debt legacies such as Hambantota, competing port and infrastructure offers, and constant demands for maritime domain awareness force Colombo into a perpetual tightrope walk. Naval incidents near Sri Lankan waters remind us how easily the island could become a theatre for proxy rivalries. In such an environment, objective intelligence is not a luxury, it is survival. Yet when agencies are politicised, accurate analysis becomes impossible.

Reports are shaped to please the government of the day rather than reflect reality. Appointments go to loyalists, not professionals. Surveillance targets opposition figures, journalists, activists, and minority communities instead of terrorists, drug lords, or foreign agents. This is not a bureaucratic accident; it is deliberate design repeated across successive governments.

The 2019 Easter Sunday attacks remain the bloodiest proof. Credible warnings about Islamist extremism were ignored or poorly coordinated because of political rivalries and interference. Two hundred and sixty-nine people died in an atrocity that could have been prevented. In the North and East, continued intimidation of Tamils, Muslims, human rights defenders and war victims’ families has poisoned community relations and created dangerous intelligence black holes.

Resources are wasted watching critics while organised crime, gun violence, human trafficking, drug smuggling and hybrid disinformation flourish. The new Protection of the State from Terrorism Act (PSTA) risks becoming another tool of abuse unless accompanied by genuine safeguards.

Cyber vulnerabilities, climate-driven unrest and economic fragility only multiply these risks. Politicised intelligence does not protect the state, it hollows it out.

The National Security Council as Institutional Firewall

Sri Lanka’s 2026 National Security Strategy draft finally recognises the need for an empowered NSC. This must not become another decorative body. It should be established by law with the following core features:

• Statutory independence and fixed-term, merit-based appointments for key leadership, insulated from electoral cycles.

• A clear legal distinction between the permanent State and the temporary Government.

• A professional secretariat for real-time coordination across intelligence, military, police, foreign affairs and cyber agencies.

• Parliamentary oversight committees that include opposition members and require regular redacted public reporting.

• Strong protections for officers who deliver objective analysis, even when it is politically inconvenient.

Such an NSC would integrate political direction with professional assessment, end fragmented decision-making, and prevent partisan capture. It would allow Sri Lanka to craft long-term strategy rather than lurch from crisis to crisis.

Learning from India’s Post-Kargil Reforms

India’s experience is directly relevant. Before 1999, India suffered from the same fragmentation and coordination failures Sri Lanka faces today.

The Kargil Review Committee exposed glaring intelligence and structural weaknesses after the border conflict with Pakistan. In response, India created a permanent National Security Council headed by the Prime Minister. At its heart is a powerful National Security Advisor (NSA) supported by the National Security Council Secretariat (NSCS) and the Joint Intelligence Committee (JIC). The system coordinates inputs from the Intelligence Bureau (internal security), RAW (external intelligence), military intelligence and other agencies.

The Strategic Policy Group brings senior officials together for integrated advice, while the National Security Advisory Board draws independent experts for long-term thinking. These reforms did not eliminate all political influence; no large democracy is immune but they dramatically improved coordination, professionalised assessment, and enabled more assertive and coherent diplomacy. India’s ability to handle complex Indian Ocean challenges, respond to crises, and balance major powers has visibly strengthened since the reforms.

Sri Lanka, being smaller and more compact, can adapt this model even more effectively. A well-designed NSC here would be easier to manage than India’s vast apparatus, yet it could deliver the same benefits: continuity, centralised coordination, merit-based leadership, and reduced politicisation.

The key difference is political will. India acted decisively after a major shock. Sri Lanka has had multiple shocks, the Easter attacks being the most painful yet structural reform remains elusive.

Countries that succeed, such as Singapore and Israel, maintain strict firewalls between intelligence and partisan politics. They recruit and protect competent professionals who serve the nation, not the ruling party. Their agencies earn both domestic trust and international respect. Politicised systems, by contrast, breed repression, repeated failures and eroded sovereignty.

The Path Forward

Implementing genuine NSC reform will require courage from the highest levels of leadership. Superficial changes designed only to satisfy donors will achieve nothing. Sri Lanka must enshrine merit, oversight and professional culture in law. This will rebuild trust with minority communities, restore credibility with international partners (India, the US, Japan and others), and allow balanced diplomacy in a contested ocean. It will also free resources to tackle real threats terrorism, organised crime, cyber attacks and climate-induced instability instead of chasing political opponents.

The cost of continued inaction is painfully clear: more intelligence failures, deeper ethnic divisions, investor flight, and a permanent loss of strategic autonomy. The reward is equally clear a professional security apparatus that converts Sri Lanka’s geographic gift into genuine national strength, economic confidence and regional respect.

In 2026, Sri Lanka’s most important battle is not against an external enemy but against the internal politicisation that turns protectors into political instruments. Establishing a strong, independent National Security Council is not institutional tinkering; it is a patriotic necessity.

By learning from India’s proven reforms and committing to merit, coordination and accountability, Sri Lanka can finally build intelligence services worthy of its people and its strategic location. The draft National Security Strategy must now become binding law and practice. Half-measures will only mortgage the future. Professional, depoliticised institutions are the foundation on which Sri Lanka’s security, stability and prosperity must rest.

Sri Lanka’s future will not be decided in the Indian Ocean, but in Colombo’s willingness to build institutions that place the State above the Government of the day. A strong, independent National Security Council is not merely a reform, it is the decisive step towards turning strategic vulnerability into enduring national strength. The time for excuses is over. The time for action is now.”

Writer

Mahil Dole, SSP (Retired), is the former Head of the Counter-Terrorism Division of the State Intelligence Service of Sri Lanka, and has served as Head of the Sri Lankan Delegation at three BIMSTEC Security Conferences. With over 40 years of experience in policing and intelligence, he writes on regional security, interfaith relations, and geopolitical strategy.

By Mahil Dole ssp rtd.

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Opinion

Rising electricity tariffs: A national economic crisis beyond monthly bill

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Tariff Increase: Visible and Real Impact

The recent increase in electricity tariffs in Sri Lanka has created serious social and economic concerns. The increase applies especially to consumers who use more than 180 units of electricity. Their bills may rise by more than 18%.

At first, this may look like a decision that affects only “high electricity users.” But in reality, the impact is much wider. It affects households, businesses, industries, services, inflation, investment, and national competitiveness.

Sri Lanka is now facing a situation where electricity bills continue to rise again and again. This should not be seen as a one-time tariff revision. If the price of one unit of electricity keeps increasing, the deeper problem is not only household consumption. The real problem is the high cost of electricity generation. Therefore, the unit price of electricity cannot be reduced in a sustainable way unless the cost of generation is reduced first.

The main concern is that Sri Lanka still does not seem to have a clear, practical, and measurable long-term plan to reduce generation costs. What we often hear are political explanations, temporary promises, and hopeful statements. But hope alone cannot reduce electricity tariffs. What the country needs is a realistic national plan. It must focus on low-cost power generation, efficient management, renewable energy investment, and serious reforms in the electricity sector.

Electricity is a basic foundation of a modern economy. When its price increases, it affects the cost of living, business costs, production, and national competitiveness. According to the Public Utilities Commission of Sri Lanka (PUCSL) announcements, the May 2026 revision applies especially to domestic consumers above 180 units, government institutions, large industries, and several GP2 and GP3 categories.

Direct Impact: Pressure on the Middle Class

The tariff increase directly affects middle-class and upper-middle-class families that use more than 180 units of electricity. In urban and semi-urban life, many electrical appliances are now part of daily life. These include refrigerators, water pumps, computers, internet devices, washing machines, fans, rice cookers, and other household equipment.

Many families exceed 180 units not because they live luxuriously, but because modern life requires electricity. Therefore, it is not realistic to say that this decision affects only the rich. Children’s education, online learning, work from home, small home-based businesses, water supply, communication, and basic household safety all depend on electricity.

According to PUCSL examples, a household using 210 units may see its bill increase from Rs. 9,570 to Rs. 11,330. This is an increase of about Rs. 1,760 per month, or nearly Rs. 21,000 per year. For families whose incomes are not rising at the same pace, this is a serious burden. It reduces savings. It affects education, health, food, and daily consumption. When electricity bills, food prices, fuel prices, and loan costs rise together, middle-class confidence falls. Families begin to cut non-essential spending. This also reduces market demand. Therefore, the electricity tariff increase is not just another monthly bill. It is a deeper pressure on living standards, savings, and economic security.

Impact on the Business Sector

The wider impact of electricity tariff increases is seen most clearly in the business sector. Factories, hotels, restaurants, supermarkets, cold storage facilities, bakeries, printing businesses, IT firms, and small and medium enterprises all depend heavily on electricity.

When electricity costs rise, production and service costs also rise.

In 2024, the industrial sector alone used 4,622 GWh of electricity. This was 30.4% of total electricity sales. The General Purpose category used 3,472 GWh, or 22.9%. This shows that a large share of electricity consumption takes place in the production and service economy.

For large industries, electricity is essential for machinery, refrigeration, lighting, packaging, water pumping, and quality control. When the unit price of electricity rises, the cost of producing each item also rises. Businesses then have only a few choices. They can pass the cost to consumers. They can reduce their profit margins. Or they can reduce production.

For small and medium businesses, the pressure is even greater. Large companies may be able to invest in solar power, energy-efficient machinery, or special credit facilities. But small businesses have limited options. For a bakery, salon, grocery shop, or small restaurant, a higher electricity bill directly affects daily cash flow. In the end, these costs enter the prices of goods and services. The price of food at a restaurant, goods at a shop, products from a factory, and services at a hotel can all rise because of electricity costs.

In the long run, this can also affect employment, wage increases, business expansion, and overall economic activity.

Inflation and the Cost of Living

Higher electricity tariffs can create a risk of rising inflation. Electricity is not only a household bill. It is also a key cost in food production, storage, transport, industry, hotels, hospitals, schools, and many services.

When electricity costs rise, that cost gradually enters the prices of goods and services.

Sri Lanka’s recent experience shows how dangerous this can be. In September 2022, annual inflation based on the Colombo Consumer Price Index reached 69.8%. Food inflation reached 94.9%, while non-food inflation reached 57.6%. This shows how quickly living costs can rise when fuel, electricity, transport, and exchange rate pressures come together. In April 2026, CCPI-based annual inflation also increased from 2.2% in March to 5.4%. Non-food inflation rose from 2.9% to 6.8%. This is an important warning.

Under the CCPI base year 2021=100, the category “Housing, Water, Electricity, Gas and Other Fuels” carries a weight of about 31.6% in the consumer price index. Therefore, higher electricity and fuel costs can have a direct impact on inflation. The risk is that an electricity bill increase does not stop with the electricity bill. It can later spread into food prices, medicine prices, school services, hospital services, restaurant prices, and transport costs. This is known as a second-round effect.

When inflation remains high, real household income falls. Even if salaries remain the same in numbers, people can buy less with that salary. There is another danger. If people and businesses expect prices to keep rising, businesses may raise prices early. Workers may demand higher wages. Suppliers may sign contracts at higher prices. This can create a wage-price spiral. Therefore, the inflationary impact of electricity tariff increases should not be treated lightly. The country needs more than tariff increases to cover institutional losses. It needs a long-term plan to reduce the cost of electricity generation, diversify the energy mix, and protect the cost of living.

Coal, Oil, and the Cost of Power Generation

One major reason for rising electricity tariffs is the way electricity is generated. Consumers see only the final bill. But behind that bill are fuel choices, power plant efficiency, import costs, exchange rates, and weaknesses in energy planning.

A major part of Sri Lanka’s electricity generation still depends on coal and fuel oil. In 2024, total electricity generation was 16,802 GWh. Coal accounted for 32.6%. CEB oil-based generation accounted for 9.3%. IPP oil-based generation accounted for 4.6%. Together, coal and oil-based generation made up nearly 46% of total generation. This is very important for tariff decisions.

Coal power plants such as Norochcholai provide relatively low-cost base power. But when such plants face maintenance problems, technical failures, or unexpected shutdowns, the country loses low-cost electricity. It then has to use more expensive oil-based power plants.

According to CEB 2024 data, the fuel cost of one unit of electricity from Lakvijaya coal power was Rs. 17.96 per kWh. But some diesel and LAD power plants cost more than Rs. 40 to Rs. 100 per kWh. This clearly shows how the generation mix affects the unit price of electricity.

Coal and oil are also imported fuels. They depend on foreign exchange. When global fuel prices rise, when the rupee weakens, or when geopolitical risks increase, electricity generation costs also rise. Therefore, a real discussion on reducing electricity tariffs must begin with reducing generation costs. Sri Lanka needs a practical plan to move towards lower-cost, reliable, and locally available energy sources.

Inefficiency and Policy Weaknesses

Another major reason for repeated tariff increases is long-term inefficiency in the electricity sector. Old transmission systems, power losses, delayed projects, inefficient procurement, political interference, and the absence of a stable energy policy have weakened electricity planning.

An efficient electricity system needs timely investment in low-cost power plants. Existing plants must be properly maintained. Transmission and distribution systems must be modernized. Renewable energy projects must be connected to the grid without unnecessary delay. When these steps are not taken on time, the country becomes dependent on expensive emergency solutions. Sri Lanka has natural advantages in solar, wind, and small hydro power. But delays in approvals, limited grid capacity, legal uncertainty for investors, and frequent policy changes have prevented the country from using this potential fully. This is a lost economic opportunity.

Another weakness is that decisions in the electricity sector are often driven more by politics than by technical and economic logic. Tariff decisions, power plant selection, project approvals, and institutional reforms should be based on professional judgment. When decisions are made for short-term popularity, the long-term cost is paid by the public.

Therefore, a plan to reduce electricity tariffs cannot be only a tariff announcement. It must be a full reform programme. It must reduce generation costs, reduce dependence on imported fuel, strengthen the grid, speed up renewable energy, and reduce institutional inefficiency. Without such a plan, electricity bills will continue to remain a burden on the people.

Impact on National Competitiveness

High electricity costs do not affect households alone. They also affect production costs, export prices, investment decisions, tourism costs, and the service economy. Therefore, electricity tariffs are a key factor in national competitiveness.

When electricity costs rise, it becomes harder for exporters to compete on price. Sectors such as apparel, food processing, rubber, plastics, packaging, printing, and light manufacturing all depend on electricity. International buyers are highly price-sensitive. If Sri Lanka’s production costs rise, its export competitiveness weakens.

Tourism is also affected. Hotels, restaurants, guest houses, and villas need electricity for air conditioning, lighting, laundry, kitchens, water heating, and digital systems. When electricity bills rise, room rates and service charges may also rise. This can make Sri Lanka less attractive compared to regional competitors. The IT, BPO, software, and digital service sectors also need reliable and affordable electricity. Higher power costs and uncertainty about supply can reduce the confidence of foreign clients and investors.

Foreign investors consider energy costs when choosing a country. They also look at labour costs, tax policy, legal stability, market access, and infrastructure. If electricity is expensive, the system is inefficient, and policy is unstable, investors see the country as risky. In the long run, this can affect new investment, jobs, wage growth, and economic growth. Therefore, electricity tariff increases must also be seen as a national competitiveness issue. If Sri Lanka wants to expand exports, strengthen tourism, attract investment, and create jobs, it needs a reliable electricity system at a reasonable cost.

A Positive Side: An Opportunity for Energy Efficiency

This situation should not be seen only negatively. Higher electricity prices can also encourage people to think more seriously about energy efficiency.

According to CEB 2024 data, electricity exported to the grid through rooftop solar increased from 632 GWh in 2023 to 867 GWh in 2024. This is a 37% increase. The number of rooftop solar accounts increased from 39,827 to 73,050, an 83% increase. This is a positive sign. It shows that people are looking for energy alternatives. But this alone is not enough. Individual solar adoption is useful, but the country still needs a reliable, coordinated, and long-term national energy plan to reduce overall generation costs.

What Should Be Done?

Sri Lanka cannot depend only on short-term solutions. The country needs a national policy that builds long-term energy security and economic stability.

Renewable energy must be accelerated. Sri Lanka has strong natural advantages in solar, wind, and hydro power. But delays in projects, policy instability, and investment barriers have prevented the country from using this potential fully. Households and businesses should be encouraged to use solar power. This can be done through affordable loans, tax relief, and a clear legal framework. If people can produce part of their own electricity, pressure on the national grid will also reduce.

Efficiency, Transparency, and Public Responsibility

To solve this problem, inefficiency and waste in the electricity sector must be reduced. Transmission losses, delayed projects, weak management, and political interference must be addressed. Financial transparency and professional management in institutions such as the Ceylon Electricity Board are also essential. This can help rebuild public trust.

The public also has a role. People should use electricity responsibly. They should use energy-efficient appliances, reduce waste, and change consumption habits where possible. But public responsibility alone cannot solve the problem. Even if people save electricity, the unit price cannot fall if national generation costs remain high. Therefore, responsible consumption by the public and a serious government plan to reduce generation costs must go together.

Rising electricity tariffs are not only about a higher electricity bill. They affect the entire economy. They influence household living costs, business costs, inflation, investment, and national competitiveness. The long-term solution is not repeated tariff increases. It is an efficient, diversified, and sustainable energy policy. The price of one unit of electricity can be reduced only when the cost of producing that unit is reduced. Political hope is not enough. Sri Lanka needs a practical national programme with clear targets, a timeline, investment support, faster renewable energy development, and reforms to reduce inefficiency in the electricity sector. Without such a programme, promises to reduce electricity bills will sound to the public like another political explanation and another hopeful statement.

by Prof. Ranjith Bandara

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