The budget for 2026, proposed by the government, has been generally well received. The Ceylon Chamber of Commerce praised the plan, with its Chairperson Krishan Balendra stating that “from a private-sector perspective this Budget provides stability” and emphasising that “with the steps that were taken and the discipline we have seen since 2022, Sri Lanka avoided going down the same path as countries that suffered years of high inflation and collapsing exchange rates. This budget continues that stability.” On the Opposition side, Harsha de Silva of the SJB, acknowledged that the government “has shown prudence in aligning with international financial institutions”, even though his party will continue scrutinising the human-cost of the measures and the absence of a programme to achieve economic growth.

The government’s deference to the international community with regard to economic affairs has been unexpected. Many analysts believed that given the party’s roots in Marxist ideology the leadership would adopt a more confrontational stance. Yet the opposite has happened. This adherence to the IMF’s prescriptions has brought two immediate concerns to light. First, the economic hardships on the poorer sections of the population are barely mitigated, if at all. The budget appears focused on preserving economic stability rather than growth or social justice. There is no meaningful tax relief and the tax policies are clearly framed to maximise revenue for the government rather than to benefit the people.  In a war or disturbed situation, the general observation is that businesses make money not the working people, which  the government needs to correct.

Second, the document does not set out a clear roadmap for how economic growth and production might be boosted in the short-term; there are no massive development projects mooted and nothing comparable to the Mahaweli River diversion or the 200-Garment Factory programme of earlier eras that improved infrastructure, like roads, water, and electricity, and contributed significantly to Sri Lanka’s rural economy.  The government’s priority seems to be in avoiding another cycle of international debt and bankruptcy, as occurred in 2021, a scenario no Sri Lankan wishes to revisit. Yet there is a danger. If the current level of economic hardship continues, frustration among the people may rise and generate the very mass-based disillusionment that pushed the previous government out of power. The government needs to move now into the next phase of its economic recovery programme by mapping out a plan not just for stabilisation but for real growth of the economy.

Equal Priority

To promote growth, one of the pre-requisites is to unify the country’s multi-ethnic and multi-religious population behind the developmental effort. The government has made a commendable start by convincing all sections of society that they will be treated as equal citizens with no discrimination. In the past, the war and the ensuing political instability kept foreign investors away. Even though more than 16 years have passed since the end of the war, foreign investment has still not materialised on the scale seen in much of the rest of Asia. Among the many reasons for this reluctance for foreign companies to invest have been high levels of corruption which the government is tackling in an  exemplary way and bureaucratic delays, which, unfortunately, appear to have worsened.

 But just as crucial to the country’s abysmal failure to attract foreign investment has been the failure to heal the wounds of war.  This is evident in the recurring sessions of the United Nations Human Rights Council (UNHRC) in Geneva. The government, therefore, needs to show the same level of commitment in dealing with the several UNHRC resolutions, notably the 2015 Resolution 30/1, followed by Resolutions 34/1, 40/1, 46/1 and 51/1 that the country has been compelled to deal  with since the end of the war in 2009. Unfortunately, the indications are that the government believes that following the IMF prescriptions is more important for the country than the UNHRC recommendations. The sense conveyed is that IMF outcomes are top priority while reconciliation obligations have been put to the back-burner with the engine of development working on half-burner.

During the budget debate the President spoke in a non-committal manner to the question of holding provincial council elections as soon as possible. The system of provincial councils was established in 1987 as part of the Constitution and as a solution to the ethnic conflict, giving Tamil and Muslim minorities a measure of decision-making power where they live as a local majority. When provincial council elections fell due in 2017, the then government deliberately scuttled those elections by starting to amend the election law and stopping half way. The conduct of the provincial council elections now forms part of the UNHRC resolutions and also of the European Union’s GSP Plus requirements. The government, with its 2/3 majority in Parliament, can expedite the process of amending the election law.

For economic growth to take place the government needs to assign equal priority to the reconciliation process, in the same way it is adhering to the IMF agreement. Just as strict compliance with the economic programme has impressed international financial institutions, so, too, would the systematic implementation of the UNHRC’s resolutions impress the international human-rights community and international investors alike while reassuring the minority communities. The government would be making a serious mistake if it believed that focusing on economic development alone would win the confidence of ethnic and religious minorities. These communities also need to feel sure that the government is seriously addressing the roots of the ethnic conflict and not simply managing the symptoms.

Foreign Investment

Recent surveys, such as the Sri Lanka Barometer, reveal that levels of trust among ethnic and religious minorities, particularly those living in the North and East, where the war was fought,  are ebbing and remain lower than in the rest of the country. Among the potential foreign investors are members of the Tamil diaspora, who might invest significantly in Sri Lanka if they are confident that their investments will be secure and that the government is serious about resolving the ethnic conflict. One representative of the diaspora, Roger Srivasan, a former President of UNP (UK) Branch, addressing a group of community leaders, last week, asserted that the Tamil Diaspora had an annual economic output of  anywhere between USD 50 billion to double that amount, part of which they could invest in the country if they observed a credible path to sustainable peace.  If the diaspora were, indeed, to commence investing in Sri Lanka in a big way, it would be a powerful signal to other international investors that Sri Lanka is politically stable and worth investing in.

 A government commitment to economic recovery, with reconciliation, will mean not just improved macroeconomic indicators but deeper social cohesion, a broadened base for investment, and a more resilient economy. By investing in unity, as much as in production, the country will be able to tap into latent potential across all communities and regions. Economic growth, which benefits the majority of people in all parts of the country, does not emerge simply from fiscal adjustment but from reaching out to all citizens, ensuring they have a stake in national progress. It is not enough to stabilise the economy, the government must ensure that every citizen, regardless of ethnicity or religion, sees themselves as an integral part of the national endeavour.

In this light the budget and government policy need to reflect both economic and social-political dimensions. Projects should not only aim at GDP growth but also at healing the scars of conflict, empowering minority communities, and laying the institutions for power-sharing and trust-building to flourish. Only then will Sri Lanka be able to move beyond stabilisation into a sustainable growth era in which the full energy of all communities is harnessed, and where the benefits of development are genuinely shared. Growth will not come from positive fiscal balances alone but from overcoming the trust deficit, and building a sense of shared belonging, by providing decision-making power to those who, for decades, have felt excluded and aggrieved. By giving reconciliation the same central place as macroeconomic reform, the government will lay the foundation for economic growth that truly takes off.

by Jehan Perera

100 Years of Tea Research:

The Tea Research Institute (TRI) of Sri Lanka is celebrating its centenary this year.  Hence, this is an appropriate time to review the contribution that the TRI has made to the sustenance of the Sri Lankan tea industry and assess its current and future challenges.

History and past achievements of the TRI

The tea industry of Sri Lanka started in 1867 with the first commercial tea plantation by James Taylor at Loolecondera Estate.  The TRI was started in 1925 as a result of the vision and the initiative of Robert Gordon Coombe, who recognized the need of an institute to provide research-based solutions to field- and processing problems encountered by the expanding tea plantations and to generate new technologies to take the industry forward in an increasingly competitive global market.  During the ensuing 100 years up to today, the Tea Research Institute has performed those primary functions that were expected from it at its inception, with varying degrees of success.  The tea industry, both in Sri Lanka and elsewhere, has evolved during these 100 years, going through several phases and facing a multitude of challenges.  For most of the past 100 years, the TRI of Sri Lanka has been at the forefront of innovations, research-based solutions and advisory services to sustain the Sri Lankan tea industry, enabling it to be economically profitable and globally competitive.  A few major achievements are given below.

There has been a vibrant plant breeding program which has produced more than 70 new cultivars where greater yield potential has been combined with appreciable tolerance of some of the major biotic stresses (diseases and pests) and abiotic stresses (drought).  Latest additions to this are four new cultivars of the TRI 5000 Series, which are recommended to the tea-growing regions at lower elevations (low-country).  These will be launched at the International Tea Symposium on the 10th and 11th of November to mark the centenary of the TRI.  All agronomic practices from soil rehabilitation and crop establishment to crop management and harvesting that are currently practiced by tea growers in Sri Lanka are the result of TRI’s long-term research.  Starting with the famous ‘Eden trial’ (initiated by Dr. T. Eden), which was the first long-term fertilizer experiment to be done anywhere in the world for a perennial crop, the TRI has provided the guidelines for soil fertility management through soil conservation and fertilizer applications.  The innovations and advances in tea processing technology generated by the TRI, most notably the fluid bed dryer, have ensured that Sri Lanka produced a tea of high quality, with a diverse range of unique characteristics.  The TRI has made significant contributions to elucidating the biochemical components of black tea and its health benefits, while developing a diverse range of products such as a tea wine, a carbonated drink and tea extracts for manufacture of chilled beverages.  The Pathology, Entomology and Nematology divisions of the TRI have been at the forefront of tackling some of the major pests and diseases of tea.  A landmark achievement in this regard was the successful control of the pest tea tortrix using a biological agent.  Importantly, the TRI has provided research-based guidelines on the correct use of agrochemicals for pest and disease control so that the consignments of made tea exported from Sri Lanka are within the maximum permissible limits of chemical residues (MRLs) as required by the different importing countries.  Therefore, TRI research has ensured that Sri Lanka produces the cleanest tea to the global market.  The latest contribution from the TRI to ensure market competitiveness of Ceylon Tea is the generation of the scientific data to characterize and formulate the Geographic Indicators (GI) for Ceylon Tea.  It is expected that Ceylon Tea will receive GI certification in the near future.

The TRI has provided benchmarks and guidance for ensuring economic sustainability of the tea production via assessment of costs of different steps of the process, while introducing alternative worker deployment models as a solution for the prevailing labour shortage and outmigration of labour from the tea plantations.  In parallel to its research program, the TRI provides an advisory and extension service which is highly sought after by managers of large plantations as well as smallholders.

Current and future challenges to the tea industry in Sri Lanka

The tea industry occupies a vital niche in the Sri Lankan economy and its socio-cultural landscape.  Currently, it brings in 1.43 billion US Dollars’ worth of foreign exchange revenue and contributes 1 – 2% to the national GDP while making up 51% of the export earnings from agricultural products.  It provides direct employment to 700,000 people which increases to 2.5 million people who depend directly or indirectly on the tea industry.  As such, it is imperative that steps are taken to ensure the sustainability of the tea industry.  This necessitates addressing several critical issues that the industry faces at present and is likely to face in the future.  A few of these are discussed below:

The need to replace an aging planting stock

Sri Lanka currently has an aging planting stock in its tea plantations and smallholdings.  The economic lifespan of a vegetatively propagated (VP) tea bush ranges from 25-30 years in the lower elevations (low-country) and 40-60 years in the higher elevations (up-country).  A significant portion of tea bushes in Sri Lanka’s tea plantations have passed their economic lifespan.  The same is true for smallholdings which are mostly concentrated in the low-country.  The large plantations contain an appreciable portion of low-yielding old seedling tea, which is well over 60-80 years old.  This aging planting stock is a major reason for the clear decline in national tea production, which after reaching a peak of 340 million kilograms of made tea in 2013-14, declined to 256 million kilograms in 2023.  This decline was reversed to 262 million kilograms in 2024, and the current government has set an ambitious target of achieving 400 million kilograms in 2030 with an export earnings target of 2.5 billion US Dollars.

Therefore, replanting has become a critically urgent necessity to ensure sustainability in the Sri Lankan tea industry.  Based on the productivity data of 2008, the TRI recommended an annual replanting rate of 2% per year (i.e. 2% of the existing tea area to be replanted every year).  However, according to TRI assessments, the current replanting rate stands at 0.6% per year so that the required rate of replanting to maintain adequate production levels has risen to 3-4% per year.  The high cost of replanting, which currently stands at Rs. 7.4 million per hectare, the 1½ to 2-year period without revenue (due to soil rehabilitation, replanting and bringing the plants to ‘bearing’) and the 8 to 10-year period of return-to-investment are major obstacles to increasing the replanting rate.  Therefore, urgent government intervention, in the form of a well-coordinated subsidy for replanting, is needed to arrest the productivity decline that is currently occurring due to this aging planting stock.  It is worth noting that the substantial investment that the industry currently puts in for fertilizer application and other field operations such as plucking, shade management and pruning does not yield its full benefit in terms of productivity, primarily because of the poor fertilizer response of this aging planting stock.  In this regard, there is a request by the Regional Plantation Companies (RPCs) to extend their current lease agreement, which is due to expire in another 20 years, to ensure that these companies invest adequately on the future development of the tea plantations.

Original building (called Linfield Bungalow) where TRI was started in 1925
in the present Pedro Estate in Nuwara Eliy

The need to address the prevailing severe labour shortage

Tea is a highly labour-intensive crop, especially in Sri Lanka.  A substantial portion of Sri Lanka’s tea is grown on hilly terrain which is not easily amenable to mechanization.  More importantly, the price premium that Ceylon Tea enjoys in the global market is primarily due to its unique quality characteristics that comes partly because of the ‘orthodox’ manufacturing process.  In order to ensure the quality characteristics of orthodox black tea, harvesting the tea shoots at the correct stage of maturity (ideally two leaves and a bud) is essential.  Currently, this is possible only by manual selective harvesting because at any given time, a tea bush grown in Sri Lanka contains several generations of shoots at different stages of maturity.  Therefore, selective harvesting of tea in Sri Lanka remains one of the most labour-intensive operations.  Research conducted by the TRI over the last decade has shown that non-selective machine harvesting incurs a yield reduction of 40% or more in comparison to manual harvesting at a frequency of every seven days (plucking round).  In contrast to tea grown in a tropical climate such as that in Sri Lanka, where a new generation of shoots is initiated weekly throughout the year, tea grown in sub-tropical or temperate climates in North India, Japan and China, which have a dormant period in the winter followed by an even generation of shoots in the spring, are amenable to non-selective machine harvesting.  It is also notable that our competitor countries such as Kenya does not depend as critically on quality as Ceylon Tea and as such can afford to implement non-selective machine harvesting.

Despite the yield reduction that is incurred, most plantations in Sri Lanka have been forced to use non-selective harvesting machines and extended manual plucking rounds because of the severe shortage of labour.  The labour force in the plantation sector, which stood at one million at the time of privatization in 1993, now stands at 100,000, out of which about 85% is in the tea sector.  This is primarily because of the outmigration of labour, especially the younger generation, from the plantations in search of more socially acceptable and financially attractive employment outside the plantation sector and overseas.  Even the smallholder sector is experiencing the shortage of pluckers which has resulted in extended plucking rounds.  Research in the TRI has shown clearly that extended plucking rounds reduce the quality characteristics of made tea because a higher proportion of mature leaves come into the harvest.  The TRI has addressed this critical issue of labour shortage in the tea industry via a two-pronged strategy.

Strategies to overcome the labour shortage

One strategy is to initiate a research program to develop a selective harvesting machine.  In the 1990s, the TRI developed a selective harvesting shear which reduced the labour requirement for plucking while ensuring selectivity and quality without a reduction in yield.  Currently, the TRI is engaged in a collaborative research program with the Arthur C. Clark Centre to develop a selective harvesting machine.  The present prototype that this program has produced achieves a 60% level of selectivity, which needs further improvement, before the machine can be commercialized.

Adoption of alternative worker deployment models (AWDs) is the second strategy that the TRI has proposed to arrest the outmigration of labour from plantations and ensure availability of adequate labour to maintain the plantations with good agricultural practices (GAPs).  The AWDs range from simple systems such as contract labour and cash plucking to revenue sharing and out-grower models, where the estate workers become trusted and respected partners in the venture.  Several regional plantation companies have adopted different variants of AWDs with varying degrees of success.  The TRI has been providing advice on the correct strategies of adopting different AWDs. (To be concluded)

The author (janendrad@gmail.com) acknowledges the information provided by Dr. H.W. Shyamalie, Principal Research Officer and Head of Agricultural Economics Division of the TRI and Dr. Mahasen Ranatunga, Director, Tea Research Institute.  Most ideas and strategies discussed in this article are the result of many fruitful discussions that took place over the last two decades during deliberations of different sub-committees of the TRI and in meetings of the Tea Research Board during the past year. (To be concluded tomorrow)

Singer Alston Koch, of ‘Disco Lady’ fame, has been much in the news these past few weeks.

Also known as “Asia’s King of Pop,” Alston is set to perform at the 8th WCH Royal Summit, in Bali, Indonesia.

A news release, from the organisers of this prestigious event, highlighted the following:

Alston Koch: In Indonesia for a
prestigious event

“We are absolutely thrilled to announce that the one and only Alston Koch, Asia’s King of Pop and Commonwealth Union Envoy to Australia and the Pacific Region, will join us as a VIP Guest and Celebrity Performer at the 8th WCH Royal Summit!

“Get ready, Bali! Alston will be gracing our event this November 12-13, 2025. His incredible talent and superstar presence will bring an unparalleled level of excitement to our global gathering. We can’t wait to see him perform!”

According to reports coming my way, Alston will deliver a special musical performance at the Summit, which is dedicated to promoting peace, sustainability, and cultural diplomacy.

What’s more, Alston, I’m told, will receive knighthood recognition during the WCH Royal Awards Gala Night for his outstanding contributions to music and humanity.

The Sri Lankan-born artiste, who now resides in Australia, is a passionate advocate for climate action and environmental awareness, aligning with the Summit’s theme of transforming compassion into global action.

Concert in Colombo long overdue

Alston has performed worldwide and achieved success in countries like Australia, Indonesia, Thailand, Malaysia, Singapore, India, and Sri Lanka, and he has received numerous international awards for his influence in music and philanthropy, including ARIA awards and a platinum award.

Surprisingly, we have not seen Alston doing his own thing, in our part of the world, for quite a while.

The last time I saw him in action, at a concert, was decades ago … at the BMICH!

I’m sure music lovers here would love to experience an Alston Koch concert in Colombo.

In October 2025, Alston Koch was appointed Envoy to Australia and the Pacific Region by the Commonwealth Union, representing the organisation in promoting regional collaboration, inclusivity, and sustainability.

The 8th WCH Royal Summit will take place at the UC Silver & Gold in Bali, featuring an elite assembly of global influencers dedicated to advancing peace, humanitarian development, and sustainable impact.