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AKD warns of far reaching economic consequences of Middle East war

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Anura

President Anura Kumara Dissanayake yesterday called for an immediate and peaceful resolution of the escalating Middle East conflict, warning that the crisis could have far-reaching repercussions on the global economy, including Sri Lanka.

Addressing Parliament, the President stressed that no military conflict benefited humanity, particularly at a time when destructive military technologies were rapidly advancing.

“Any military conflict does not create a favourable situation for any group of people,” he said, urging all parties to make urgent commitments towards peace. “As Sri Lanka, our position is that all parties involved in this war must, as soon as possible, take steps toward a peaceful world.”

He cautioned that Sri Lanka could not remain insulated from the fallout from the conflict, noting that disruptions to global oil and gas supplies, threats to migrant workers in the Middle East, and potential shocks to tourism, remittances, shipping and aviation were real concerns.

A national programme was being formulated to mitigate the impact, he said, adding that its success would hinge on broader international efforts to restore stability, the President said.

Acknowledging public anxiety shaped by past economic hardships, President Dissanayake said social stability could not be ensured through rhetoric alone but required tangible guarantees that citizens would not face another crisis.

While noting that the government had successfully navigated multiple challenges since assuming office, he described the Middle East situation as distinct due to the uncertainty surrounding its duration and outcome.

The government, he said, was closely monitoring developments. The Central Bank had conducted a review with a report on the likely economic impact expected shortly. The Ministry of Finance is also preparing an assessment of the potential effects on public life, alongside measures to ensure the uninterrupted provision of essential services locally and for Sri Lankans overseas.

“The primary responsibility for finding a path out of the crisis rests with the Government,” he said, calling on Parliament and the public to collectively confront the challenge under a unified national plan.

Providing a detailed account of the country’s energy reserves, the President said storage capacity rather than supply remained the key constraint. Excluding the Indian Oil Corporation tanks in Trincomalee, total storage capacity at Kolonnawa and Muthurajawela stands at approximately 150,000 metric tons.

Diesel stocks were currently sufficient for 33 days, with refining contributing around 1,800 metric tons daily. Petrol reserves will last 27 days, with a 35,000 metric ton shipment due on March 7 or 8 expected to extend availability to around 40 days.

Aviation fuel stocks are adequate for 49 days, supported by both daily refining and imports. Scheduled shipments include vessels from RM Parks on March 14, Sinopec on March 17, IOC on March 21 and the Ceylon Petroleum Corporation on March 28.

Crude oil supplies were sufficient to operate the refinery for 26 days, with an additional shipment expected to extend operations by a further 18 days, the President said.

“Because of this, there is no crisis regarding oil,” the President assured Parliament.



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FSP warns of possible coal shortage

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“No shipment for 10 days; seas off western coast will become rough by April end”

Education Secretary of the Frontline Socialist Party (FSP) Pubudu Jayagoda says the Indian company which secured a tender to supply coal for electricity generation this year has delivered only 13 of the 25 shipments required and no vessel has arrived in Sri Lanka for the last 10 days or so.

Jayagoda said so while addressing the media during a protest held in Colombo yesterday.

Jayagoda said the Indian company Trident Chemphar, which secured the tender to supply 25 coal shipments for 2026, had placed the country’s coal stocks at risk.

Although all 25 coal shipments are required to be unloaded before the end of April, only 13 vessels have arrived in Sri Lanka so far, according to Jayagoda. He also claimed that no shipment had arrived during the first week of March, adding that coal vessels had not arrived for about 10 days.

Jayagoda warned that the situation could endanger the country’s energy supply as the seas off the western coast usually turn rough by the end of April, disrupting unloading operations.

According to Jayagoda, a report submitted by the Public Utilities Commission of Sri Lanka to the Parliamentary Oversight Committee on infrastructure and strategic development, power cuts may become necessary from August even if the country falls short of five shipments unless electricity is generated using costly diesel-powered thermal plants.

Jayagoda also alleged irregularities in the tender process, claiming that the government had changed tender specifications and delayed the tender process by about four months, possibly to allow the Indian company time to register and secure performance guarantees.

He further alleged that the coal supplied by the Indian company was substandard.

Jayagoda questioned why the tender had not been cancelled despite several shipments allegedly failing to meet quality standards and why no investigation had been launched.He asked why legal action had not been taken against the company despite supply disruptions.

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Repatriation of Iranian naval personnel Sri Lanka’s call: Washington

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The US Department of State has said that Washington respects Sri Lanka’s sovereignty in handling matters relating to the Iranian warship IRIS Bushehr and its crew, according to agency reports, quoting a State Department Spokesperson. He has said the final decision regarding the vessel, its crew and the rescued Iranian sailors rests with Sri Lanka in accordance with its domestic laws and international legal obligations.

The statement follows comments by Foreign Minister Vijitha Herath that Sri Lanka was looking after 32 sailors rescued from the Iranian frigate IRIS Dena under Colombo’s international treaty obligations.

The frigate was sunk by a US submarine off Sri Lanka’s southern coast on Wednesday during escalating hostilities involving the United States and Iran.

Sri Lanka’s Navy conducted rescue operations, following the incident, recovering 84 bodies.

Asked whether Colombo was under US pressure not to repatriate the Iranian sailors, Herath said Sri Lanka had taken all actions in accordance with international law.

Sri Lanka also provided safe harbour to the second Iranian warship, IRIS Bushehr, and evacuated its 219 crew members a day after the Dena was torpedoed. The vessel was taken to the port of Trincomalee after reporting engine problems.

Citing an internal cable, Reuters reported that Washington had urged Sri Lanka not to repatriate the Iranian sailors. However, the State Department spokesperson reiterated that the disposition of the crew and survivors was a matter for Sri Lanka to decide, adding that the United States respects Sri Lanka’s sovereignty in managing the situation.

Meanwhile, India allowed a third Iranian warship, IRIS Lavan, to dock in a port on humanitarian grounds after it reported operational difficulties.

The ship docked at the port of Kochi, where many of the crew, including young cadets, were disembarked and transferred to a nearby facility.

President Anura Kumara Dissanayake said Colombo would follow the provisions of the Hague Convention, which requires neutral states to detain combatants of warring parties until the end of hostilities.

A senior administration official said Sri Lanka was in discussions with the International Committee of the Red Cross regarding the treatment of survivors from the torpedoed vessel. International humanitarian law would apply to the wounded, who could be repatriated if they requested it, the official added.

Iranian diplomats in Colombo have requested the return of the remains of sailors killed in the attack to Iran.

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Indian Ocean must remain peace zone: Sajith

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Opposition and SJB leader Sajith Premadasa, emphasised the critical need for the Indian Ocean region to remain peaceful and not become part of any conflict, said a news report published by NDTV yesterday.

It said: As the Iran-Israel war enters its second week, the theatre of the war has expanded dramatically, reaching the waters of Sri Lanka. With the sinking of Iranian warship IRIS Dena in international waters off Lanka’s coast and the docking of a second Iranian vessel, IRIS Busheher, Colombo has become embroiled in a conflict where it seeks to remain only a neutral bystander.

Speaking with NDTV, Sajith Premadasa, Leader of the Opposition in Sri Lanka emphasised the critical need for the Indian Ocean region to remain peaceful and not become part of any conflict.

“The Indian Ocean has on successive occasions been declared a peaceful area and should remain so,” said Premadasa.

The Sri Lankan government has said that it will attend to all survivors of the ill-fated IRIS Dena and IRIS Busheher as per international protocols and norms. Sri Lankan President Anura Kumara Dissanayake said his country had a “humanitarian responsibility” to take in the crew of the vessel, which was allowed to dock at Trincomalee in Northern Sri Lanka.

Premadasa, who is the leader of the opposition party SJB, called on all parties to cease the ‘asymmetric warfare’. He cautioned that the widening conflict would have devastating consequences for smaller countries like Sri Lanka, which is still reeling from its worst economic crisis in 2022.

“The Middle East conflict is already spreading to other countries, and this is having an impact on Sri Lanka and Sri Lankan people,” Mr Premadasa told NDTV.

A third Iranian vessel that was in the Indian Ocean, IRIS Lavan, has docked at Kochi in India. India has said it was a “humanitarian call” after the vessel sent out a distress call.

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