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WB says Lanka needs urgent policy measures to tackle unsustainable debt, Balance of Payment challenges
The World Bank last week said Sri Lanka faces unsustainable debt and Balance of Payment challenges.
“Sri Lanka’s economic outlook is highly uncertain due to the fiscal and external imbalances. Urgent policy measures are needed to address the high levels of debt and debt service, reduce the fiscal deficit, restore external stability, and mitigate the adverse impacts on the poor and vulnerable,” says the World Bank in its twice-a-year regional update.
The latest ‘South Asia Economic Focus Reshaping Norms: A New Way Forward’ projects the region to grow by 6.6% in 2022 and by 6.3% in 2023. The 2022 forecast has been revised downward by 1.0% age point compared to the January projection, mostly due to the impacts of the war in Ukraine.
Countries in South Asia are already grappling with rising commodity prices, supply bottlenecks and vulnerabilities in financial sectors. The war in Ukraine will amplify these challenges, further contributing to inflation and deteriorating current account balances.
“The World Bank is deeply concerned about the uncertain economic outlook in Sri Lanka and the impact on people,” said World Bank Country Director for Maldives, Nepal, and Sri Lanka Faris Hadad-Zervos.
“We are working on providing emergency support for poor and vulnerable households to help them weather the economic crisis and we remain committed to the wellbeing of the people of Sri Lanka, and to a narrative of sustainable and inclusive growth that will require concerted and collective action.”
Sri Lanka needs to address the structural sources of its vulnerabilities. This would require reducing fiscal deficits especially through strengthening domestic revenue mobilisation. Sri Lanka also needs to find feasible options to restore debt sustainability. The financial sector needs to be carefully monitored amid high exposure to the public sector and the impact of the recent currency depreciation on banks’ balance sheets.
The necessary adjustments may adversely affect growth and impact poverty initially but will correct the significant imbalances, subsequently providing the foundation for stronger and sustainable growth and access to international financial markets. Mitigating the impacts on the poor and vulnerable would remain critical.
In South Asia, though GDP growth continues to be solid during the recovery, all countries in the region will face challenges ahead. On a positive note, exports of services from the region are on the rise as the pandemic subsides.
The war and its impact on fuel prices can provide the region with much-needed impetus to reduce reliance on fuel imports and transition to a green, resilient and inclusive growth trajectory. The report recommends that countries steer away from inefficient fuel subsidies that tend to benefit wealthier households and deplete public resources. South Asian countries plan to move towards a greener economy by gradually introducing taxation that puts tariffs on products which cause environmental damage.
Another challenge the region faces is the disproportionate economic impact the pandemic has had on women. The report includes in-depth analysis of gender disparities in the region and their link with deeply rooted social norms, and recommends policies that will support women’s access to economic opportunities, tackle discriminatory norms and improve gender outcomes for inclusive growth.
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Women’s T20 World Cup 2026 warm-up: Chamari Athapaththu’s 94 helps Sri Lanka beat Pakistan
Captain Chamari Athapaththu’s 94 helped Sri Lanka chase down 169 with ease against Pakistan. Athapaththu and Vishmi Gunaratne together started strongly, putting up a 159-run stand as Sri Lanka won with eight balls to spare.
With the ball, right-arm seamer Chethana Vimukthi, who was called up as the injured Shashini Gimhani’s replacement. for the T20 World Cup, made an impact for Sri Lanka, finishing with figures of 4 for 31. Vimukthi broke the 60-run stand between openers Muneeba Ali and Gull Feroza, following which Pakistan lost wickets regularly. Captain Fatima Sana top-scored for Pakistan from No. 7 with 37 to push the total past 150. In reply, Sri Lanka made easy work of the chase, with Athapaththu itting five sixes and nine fours in her 56-ball stay.
Scores:
Sri Lanka Women 169 for 1 in 18.4 overs (Chamari Athapaththu 94, Vishmi Gunaratne 63*; Fatima Sana 1-20 ) beat Pakistan Women 168 for 8 in 20 overs (Muneesha Ali 36, Gull Feroza 26. Ayesha Zafar 10, Saira Jabeen 12, Fatima Sana 37, Aliya Riyaaz 22; Sugandika Kumari 1-33, Chethana Vimukthi 4-31, Malki Madara 1-19, Nimasha Meepage 1-16) by nine wickets
(Cricinfo)
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Open hearing on coal procurement inquiry set for July first week
Open hearing of evidence into alleged irregularities in coal procurement is scheduled to begin in the first week of July, while the Presidential Commission of Inquiry continues recording statements from relevant officials, investigators said.
So far, the Commission has recorded statements from around 40 government officials, including members of procurement committees and other personnel attached to institutions involved in coal-related transactions.
Officials said that, depending on evidence gathered during the ongoing inquiry, statements may also be obtained from former ministers if required.
The Commission has also received 28 complaints in connection with alleged irregularities in coal imports and related procurement processes.
President Anura Kumara Dissanayake on April 17 appointed a three-member Presidential Commission of Inquiry under the Special Presidential Commissions of Inquiry Act No. 07 of 1978 to probe alleged malpractice in coal imports and electricity generation since the inception of coal-based power generation up to April 16, 2026.
The Commission is chaired by Supreme Court Justice Gihan Kulatunga, with Court of Appeal Judge Aditya Patabendige and High Court Judge Sanjeewa Somaratne serving as members. Former State Ministry Secretary P.V. Bandulasena acts as Secretary to the Commission.
The inquiry covers alleged procurement irregularities, possible financial losses to the State, import of substandard coal, quality inspection failures, contractual breaches and operational issues in power generation, including whether corrective measures were taken where necessary.
It will also identify responsible political authorities, officials of Sri Lanka Coal Company (Private) Limited and suppliers, while recommending legal or administrative action and measures to prevent future lapses.
Meanwhile, the Committee on Public Enterprises (COPE) is also preparing to table its report on coal procurement in Parliament, with officials from relevant institutions having been summoned during its proceedings. COPE Chairman MP Dr. Nishantha Samaraweera said audit findings had also been considered, and any matters requiring further investigation would be referred to law enforcement and anti-corruption authorities.
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TNA MP calls for complete repeal of PTA
Trincomalee District TNA MP Shanakiyan Rasamanickam has submitted a motion to Parliament calling for the immediate repeal of the Prevention of Terrorism Act (PTA), arguing that the controversial law has enabled arbitrary detention, torture and the targeting of minority communities for more than four decades.
In his motion, now published in the Addendum to the Order Book of Parliament, the MP urged the Government to repeal the Prevention of Terrorism Act, No. 48 of 1979, in its entirety and refrain from introducing any replacement legislation containing similar provisions.
Rasamanickam contended that the PTA had been used for over 40 years to facilitate prolonged arbitrary detention and to obtain false confessions through torture. He further alleged that the law had disproportionately affected minority communities and civil society groups.
The motion states that there is no justification for maintaining a permanent counter-terrorism law that grants sweeping powers to the authorities.
The TNA legislator argued that existing legal provisions were sufficient to address security threats, noting that terrorism-related offences could already be prosecuted under the Penal Code.
He also pointed out that the Government retained the power to declare a state of emergency when circumstances warranted extraordinary measures, rendering a permanent anti-terrorism framework unnecessary.
Accordingly, the motion calls on Parliament to resolve that the Government take immediate steps to abolish the PTA without replacing it with legislation containing comparable powers.
The Prevention of Terrorism Act, enacted in 1979, has long been the subject of criticism from human rights organisations, civil society groups and international bodies, which have raised concerns over provisions relating to detention without trial and safeguards against abuse.
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