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Why Lanka’s collapse looms large over Bangladesh
It’s the politics, stupid. A cocktail of dynastic rule, cronyism and debt-fuelled vanity projects, to be precise.
(AL Jazeera)
Dubbed by pundits as a development “miracle”, Bangladesh is slated for graduation from the status of “Least Developed Country” to “Developing Country” by 2026.Yet, suddenly, the nation finds itself battling comparisons with Sri Lanka, which has just experienced an economic free-fall. Bangladeshi mainstream media and social media are flooded with speculations about the country’s impending collapse like its fellow South Asian nation.
Everyone from the prime minister’s office and groups of eminent economists to the American ambassador in Dhaka has chimed in to argue why they believe Bangladesh is still far removed from a Sri Lanka-like cataclysmic implosion.They may be only partly right.
Bangladesh’s GDP is about the size of the Pakistani and Sri Lankan economies combined. Bangladesh’s foreign currency reserves are $39bn, more than twice the $18bn of those two neighbours together. According to the finance ministry, Bangladesh’s total debt-to-GDP ratio stands at just over 31 percent, compared with 119 percent for Sri Lanka. Bangladesh has a higher per capita GDP than India and is outperforming other major South Asian nations in key socioeconomic metrics.
Given the above backdrop, why are Bangladeshis concerned about their country sliding, like Sri Lanka, into an economic collapse?
The answer lies not so much in economic statistics but in three key similarities between the countries that may have evaded the eyes of some external experts. These are: authoritarianism under dynastic rule; corruption and cronyism; and debt-fuelled vanity projects.
Like the Rajapaksa family, the Sri Lankan political dynasty that steered the country into its recent wilderness of despair, Bangladesh has been ruled for the past 14 years by the Awami League party, led by the family of Prime Minister Sheikh Hasina. While the Rajapaksas were at least democratically elected several times – including as recently as in 2019 – Hasina returned to power in 2018 via an election where the country’s security apparatus allegedly stuffed ballot boxes the night prior to the vote. The ruling Awami League won 96 percent of the seats, a result as lopsided as is usually the case for the rulers of North Korea, Syria, and Cambodia.
Over the years, both the Rajapaksas and the Sheikh family have drawn their political legitimacy from their much-fabled wartime leadership. In 2009, then-President Mahinda Rajapaksa and his brother, defence minister Gotabaya Rajapaksa, were in charge when the Sri Lankan government decisively vanquished the Tamil Tiger guerilla fighters in Sri Lanka’s decades-old civil war. Likewise, Hasina’s father, Sheikh Mujibur Rehman, led Bangladesh’s war of independence against Pakistan half a century ago.
Selling their family’s wartime bravado to their impoverished and nationalistic audience, both the Sheikhs and Rajapaksas established de-facto fiefdoms, where almost every living member of their respective clans got positions of power.
The Rajapaksas ran Sri Lanka like a “family firm”. Before the brothers’ rule crumbled last month, Gotabaya was president, Mahinda prime minister and their third brother Basil was a cabinet minister. Their children also held ministerial positions – all simultaneously.
Prime Minister Sheikh Hasina’s family in Bangladesh has followed a similar template, though less formally. Her daughter Saima Wazed, seen by many as her heir-apparent, attends state functions and meetings with her mother. Sajeeb Wazed, the expatriate son of the prime minister, enjoys the title of ICT adviser, with de-facto oversight of the country’s lucrative digital technology transformation. The prime minister’s sister Rehana, nephews, nieces, cousins and their children are entrusted with key responsibilities ranging from managing propaganda organisations, diplomatic and donor relationships, military affairs, parliamentary memberships and running business conglomerates.
Such control over the state machinery and private businesses invariably breeds autocracy and disrespect towards public opinion and political opponents. That, in turn, spawns rampant corruption and cronyism. That’s what happened with the Rajapaksas in Sri Lanka, where protesters found opulence in the presidential palace at variance with the dire conditions of the country. That is also the reality in Bangladesh under the Sheikh family.
What about vanity projects?
The Rajapaksas built a $1bn port that rarely saw any ships, a $210m airport where hardly any planes landed and a 35,000-seat cricket stadium bearing Mahinda Rajapaksa’s name that seldom hosted any games. These are the poster children of Sri Lanka’s debt-funded excesses that sank the nation.
Bangladeshis are now busy comparing their own white elephants with Sri Lanka’s. While the government has introduced austerity measures, including power rationing, and police have fired upon – and even killed – those protesting against price hikes, Bangladesh is going ahead with the construction of a $140m cricket stadium bearing the prime minister’s name.
The Hasina government is busy constructing several multibillion-dollar mega projects, including a $12bn nuclear power plant in Rooppur, which is significantly more expensive than similar projects in other countries. When the World Bank declined to fund Bangladesh’s recently completed Padma Bridge, citing corruption, Bangladesh self-funded and completed the 6km (3.7-mile) long bridge after spending three times the initial budget ($3.8bn vs $1.2bn).
Within about a month of opening the Padma Bridge amid much jubilation, the country frantically wrote letters to the International Monetary Fund, World Bank and Asian Development Bank for loans to keep the economy afloat amid a balance of payment crisis due to rising oil prices.
It is possible the government acted prudently by pre-emptively talking to the lenders of last resorts. After all, the Bangladesh government must have seen in Sri Lanka what economic stress can do when an autocrat’s grand bargain of “less democracy, more development” fails.
Yet it is hardly surprising that the people of Bangladesh see eerie parallels with Sri Lanka, as the contrast between their dwindling personal finances and the corruption-prone vanity projects becomes sharper. Seeing the collapse of Sri Lanka’s debt-driven, dynastic authoritarianism, the Bangladeshis are not irrational in their worry: “Are we next?”
Latest News
Sun directly overhead Bentota, Thiniyawala, Iththakanda, Udawalawe, and Kataragama about 12.08 noon t9day (06)
The sun is going to be directly over the latitudes of Sri Lanka from 28th of August to 07th of September due to its apparent southward relative motion.
The nearest places of Sri Lanka over which the sun is
overhead today (06) are Bentota, Thiniyawala, Iththakanda, Udawalawe, and Kataragama about 12.08 noon
News
UN welcomes Lanka’s anti-graft drive, seeks end to impunity
MONETABRIEF –The UN human rights chief on Thursday welcomed Sri Lanka’s robust anti-corruption drive but urged President Anura Kumara Dissanayake to apply the same vigour to ending impunity for continuing rights abuses.
In its latest report to the UN Human Rights Council in Geneva, High Commissioner Volker Turk noted that cases of torture and deaths in custody continued to be reported in Sri Lanka despite the change of administration.
“While it is encouraging that the Sri Lankan authorities have taken action to address corruption cases and some crimes linked to the post-war period, more needs to be done to end the long legacy of impunity in the country,” the rights chief said.
His report, covering October 2025 to July 2026, notes steps to tackle corruption, including high-profile arrests and investigations linked to political killings, enforced disappearances and the 2019 Easter Sunday attacks.
He said it had been a difficult period for Mr Dissanayake’s new government, following the devastating Cyclone Ditwah which killed some 650 people and devastated much of the island and a global spike in energy prices.
The report noted that the Human Rights Commission of Sri Lanka had documented 602 cases of torture and ill-treatment in 2025 and 138 cases by April 2026.
The local commission also reported 18 deaths in custody last year and a further three by April this year. In one such case, a 40-year-old inmate detained for a minor drug-related offence died at Welikada Prison in Colombo on 3 May, allegedly from severe beatings.
“This Government still has an opportunity to turn the tide on decades of abuse of executive power, repressive laws and custodial violence, and entrenched impunity,” Turk said.
He regretted that the government had yet to deliver on its promise of legal and institutional reforms and continued to apply the repressive Prevention of Terrorism Act (PTA), resulting in arbitrary arrests and prolonged detention without charge.
Civil society actors, activists and journalists remained subject to state surveillance, while tensions over land and religious sites continued to simmer, the report said.
It also highlighted violent riots at Negombo Prison in July, which left at least 32 dead, underscoring the urgent need for prison reform to address systemic issues, including severe overcrowding.
The UN Human Rights Office had received at least 16 allegations of surveillance against civil society actors, activists and journalists, the report said.
There was “a clear and continuing pattern of state surveillance, intimidation and reprisals by military and intelligence officials, including from the Criminal Investigations Department or the Terrorism Investigation Division”.
“Individuals are repeatedly questioned about their travels, especially to Geneva and engagement with UN human rights processes, as well as their organizational affiliations, funding sources, and participation in protests or commemorative events.”
While the Government had continued to denounce racism and promote national unity, wider efforts to ensure truth and justice risked stalling and the momentum for transformative change being lost, the report warned.
Failures to effectively investigate and prosecute crimes under international law allegedly committed during the armed conflict persisted.
“It is crucial that there is decisive and meaningful action toward accountability for crimes and violations by all parties during the more than two-decade armed conflict,” Turk said.
He noted the recent decision by the Attorney-General to indict former Eastern Province Chief Minister Sivanesathurai Chandrakanthan, also known as Pillayan, and three others in connection with the abduction and murder of former Eastern University Vice-Chancellor Professor Sivasubramaniam Raveendranath in 2006.
“It is, however, regrettable that many other serious emblematic cases remain stalled for years, including the killing of 17 Action Contre La Faim aid workers in Muttur 20 years ago,” he said, calling for meaningful steps to resolve such delays.
The High Commissioner urged Sri Lanka to redouble its reconciliation and accountability efforts. He called for a moratorium on the use of the Prevention of Terrorism Act pending its repeal, as well as the release of long-term detainees held under it.
He also called for all individuals credibly accused of human rights violations to be excluded from senior positions in government, the security sector or the diplomatic service until such allegations were genuinely addressed and resolved.
He urged the Government to support victims’ memorialisation initiatives and to release military-occupied lands.
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Dispute which triggered listed company director being detained at BIA resolved
A dispute between a wholly owned subsidiary of Lanka Realty Investments PLC, Mulberry Holdings (Pvt) Ltd., and a contractor, Omni Engineering & Trading Solutions, that resulted in Executive Director Hisham Jamaldeen of Lanka Realty being stopped at Katunayake and prevented from leaving on a business visit to the UK has been resolved with Jamaldeen bailed and the travel ban imposed on him revoked by the Maligakanda Magistrate, Lanka Realty’s said in a Stock Exchange filing last week.
This followed Mulberry agreeing to pay Rs. 25 million to Omni on or before Sept. 26.
Following media reports of Jamaldeen being prevented from leaving the country at the BIA, Lanka Realty made two Stock Exchange filings on Sept. 3 – the first detailing the dispute between the two parties and the second indicating that the matter had been settled.
In the first filing, the Secretaries for Lanka Realty said:
“The article refers to Mr. Mohamed Hisham Jamaldeen, Executive Director of Lanka Realty Investments PLC and a Director of Mulberry Holdings (Pvt) Ltd, a wholly owned subsidiary of the Company and the developer of “Mulberry Residences” in Colombo 10.
“Mulberry Holdings (Pvt) Ltd entered into a construction contract with Mr. Randika of M/s Omni Engineering & Trading Solutions on 21st June 2022 for a sum of LKR 32,854,992.00), which is less than 1% of the total value of the “Mulberry Residences” Project which is around LKR 3.6 Billion.
“The said contract is governed by the CIDA/SBD1 Standard Bidding Document Conditions of Contract, which provides for adjudication and, if required, arbitration as the applicable dispute resolution process. The Company understands that the underlying matter relates to a contractual payment dispute involving Mulberry Holdings (Pvt) Ltd’s aforcsaid contract.
“Following a call received from the Colombo Crime Division (CCD), Mr. Jamaldeen went to the CCD on 25th August 2026 and provided a statement in relation to the matter inter alia explaining that the matter in dispute was arising from a civil contract. He was not arrested on that date and was not informed at that time or thereafter prior to receiving information at the Airport, that a travel ban had been imposed.
“On 2nd September 2026, while travelling overseas for business on a pre-arranged itinerary, Mr. Jamaldeen was informed at immigration of a travel ban imposed on 24th August 2026, following which he was arrested by the CCD. A bail application is expected to be made when Mr. Jamaldeen is produced before the Magistrate’s Court of Maligakanda today, 3rd September 2026.”
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