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Midweek Review

Gin-Nilwala rip-off and culpability of Parliament

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By Shamindra Ferdinando

The Presidential Media Division (PMD) on the afternoon of Oct. 06, 2021 released a letter (PS/LAD/1/9/2021(iii)) Attorney-at-Law Harigupta Rohanadeera, Director General (Legal) President’s Office has sent to Attorney-at-Law W.K.D. Wijeratne, Director General, Commission to Investigate Allegations of Bribery or Corruption (CIABOC).

The letter requested the CIABOC to submit a report to President Gotabaya Rajapaksa within a month as regards the revelations made by the International Consortium of Investigative Journalists (ICIJ) pertaining to Sri Lankans engaged in controversial offshore transactions. Rohanadeera’s letter didn’t name anyone though by then the media all over the world, on the basis of ICIJ investigations, named former parliamentarian Nirupama Rajapaksa and her husband Thirukumar Nadesan as operators of offshore accounts.

Instructions issued to the CIABOC should be examined against the backdrop of Nadesan’s plea to President Gotabaya Rajapaksa that he preferred a retired judge of the Court of Appeal to inquire into the ‘Pandora Papers’ revelations.

The following is the text of Nadesan’s letter dated Oct 06: “My name and that of my wife have been referred to as having various accounts/assets offshore. These references are in what is referred to as the Pandora Papers.

“It is commonly believed that all persons whose names have been so divulged are in some way guilty of wrongdoing. Several world leaders, including His Excellency Imran Khan have publicly announced that they will investigate anyone whose names appear in Pandora Papers.

“I assure your Excellency that my wife and I are totally innocent and are guilty of no wrong doings. In the circumstances, I humbly request Your Excellency to appoint an independent investigator, preferably a retired appeal court judge, without delay, to investigate this matter so that my name and that of my wife would be cleared.

“I am making this request to Your Excellency because my wife and I have suffered heartache and pain of mind. We have been presumed guilty, the presumption of innocence is reversed. It is in these circumstances that I make this humble request to your Excellency.

“Please forgive me for intruding on your time.”

The one page letter has been sent from Nadesan’s Horton Place residence ‘Montrose’, No 95.

Is the CIABOC capable of investigating Pandora Papers revelations? The CIABOC comprising retired Supreme Court justice Eva Wanasundera, retired Appeals Court justice Deepali Wijesundara and former head of State Intelligence Service (SIS) retired DIG Chandra Nimal Wakista, faces a daunting task in producing a report within a month.

The ICIJ declared: *”In the U.S., lawmakers said they will respond to the Pandora Papers with new legislation targeting financial professionals and other businesses that move dirty money for corrupt clients;

*The European Commission’s head of taxation said the commission will push to crack down on tax avoidance and expand information exchange between countries; and

*Enforcement agencies or leaders in India, Spain, Ireland, Mexico, Germany, Pakistan, Bulgaria, Australia, Brazil, Sri Lanka, Paraguay, Panama and more have vowed to act on the Pandora Papers revelations, as new stories continue to be published and the global response to the investigation continues to grow and evolve.”

CIABOC’s status

The 20th Amendment to the Constitution, enacted in Oct 2020, deprived the CIABOC the power to initiate action. The much-touted move hailed by the ruling Sri Lanka Podujana Peramuna (SLPP) as a measure to restore political stability, obviously weakened the outfit. However, the CIABOC’s performance, even before the enactment of the 20 A, has been questionable though it engaged in some high profile exercises during the yahapalana administration. Its passage with a 2/3 majority in Parliament was followed by the CIABOC giving up on investigations initiated during the yahapalana administration.

The Transparency International Sri Lanka (TISL), the first to demand a thorough domestic investigation into the Pandora Papers has, subsequently lodged a complaint with the CIABOC seeking an investigation. Executive Director TISL Attorney-at-Law Nadishani Perera says the CIABOC has very clear powers and laws to deal with complaints though technically it cannot act on its own as a result of the 20th Amendment.

Having lodged the complaint on Oct 7, the day after President Gotabaya Rajapaksa’s intervention, TISL asserted that the transactions revealed could amount to offences under Section 23A of the Bribery Act hence the need to probe into the Declarations of Assets and Liabilities of Mrs. Nirupama Rajapaksa relating to her tenure as a Member of Parliament. TISL also points out that CIABOC is empowered to take relevant action on acquisitions through unknown sources of wealth or income, under Section 4(1) of the CIABOC Act under the provisions of the Bribery Act or the Declaration of Assets and Liabilities Law. The anti-corruption outfit suggested that investigations could be pursued under Section 70 of the Bribery Act, to investigate whether public funds had been embezzled and laundered through these foreign safe havens.

The contentious issue is whether serving or former parliamentarians or their relatives can be properly investigated without political interference. The CIABOC has conducted successful investigations even on the basis of anonymous complaints. Let me give an example to prove how a successful prosecution has been achieved in the case of a person failing to make an asset declaration.

 The Colombo High Court of No.6, Judge Patabendige on June 12, 2020, convicted a Supply Assistant of Ceylon Electricity Board (CEB) attached to the Ratnapura Branch, Wijekoon Mudiyanselage Sumanasekera, in a case prosecuted by the CIABOC based on an assets investigation conducted on an anonymous complaint received by the Commission.

 The accused, residing at the Millennium City Housing Scheme, No 14, Aturugiriya, has been accused of accumulating Rs.6 mn assets through bribes exceeding his actual income. HC judge Patabendige imposed a five year rigorous imprisonment and a fine of Rs. 5,000/-. In default of fine, further three months simple imprisonment was imposed.

The judge further ordered the official under section 26(b) of the Bribery Act to pay Rs.11,960,093/98 which was twice the amount earned by bribes. In default of payment, the accused was subjected to a term of a further two year rigorous imprisonment.

Judge Patabendige also issued an open warrant on the accused and ordered to inform the Department of Immigration and Emigration in that regard.

Deputy Director General of CIABOC Mrs. Ranjani Senewiratne prosecuted. Investigation was conducted by the OIC of the Assets Investigations Division.

However, the CIABOC will have to work closely with the Central Bank, the Inland Revenue and even the Foreign Ministry in addition to the ICIJ in conducting investigations into the Nadesan affair. Parliament, too, will have to monitor what can be easily declared as the biggest case undertaken by the CIABOC. The issue at hand is whether the assets under the name of Nirupama Rajapaksa and Thirukumar Nadesan had been declared to the relevant authorities.

 Regardless of attempts to depict the questionable transactions as dealings that had taken place during the 1990-2000 period, the Pandora Papers disclosure placed the SLPP in an extremely embarrassing position. There is no point in denying the fact that she represented the SLFP in the PA and UPFA parliamentary groups for a period of 16 years. Most of all she is a blood relative of the Rajapaksas in power. That is the undeniable truth. The revelations couldn’t have happened at a worse time for the government as it struggles to cope up with the deepening economic crisis, primarily brought on by the global pandemic.

 Conduct of parliamentarians

Colombo Chief Magistrate Buddhika Sri Ragala on July 30, 2021 acquitted one-time Deputy Minister Sarana Gunawardena of all bribery cases filed against him.

Assistant Director General of the CIABOC Asitha Anthony told the court that the case had been filed against the former Deputy Minister without the approval of the three commissioners. Attorney-at-Law Niroshan Siriwardena, appearing on behalf of Gunawardena requested that the charges against his client be dropped.

CIABOC had filed eight cases against Gunawardena, accusing him of causing losses to the State by leasing vehicles to the Development Lotteries Board (DLB) during his tenure as its Chairman in 2007.

While serving as the Chairman of DLB, Gunawardena was alleged to have influenced the officers of the DLB to rent three vehicles from his wife by paying Rs 960,000 per each vehicle where the true value per vehicle was only Rs. 635,000.

Gunawardena was convicted for all three charges that were presented against him. The rejected politician was sentenced to a prison sentence of one year on each charge cumulating a prison sentence of three years. Gunawardena was also ordered to pay a fine of Rs 100,000 for each vehicle totaling to a fine of Rs 300,000. In case Gunawardena failed to pay the fine, he was to be subjected to an additional prison sentence of six months for each offence. The prosecution was handled by Assistant Director General Mr. Asitha Athony.

The dismissal of Gunawardena’s proceedings is certainly not an isolated case. When JVP leader Anura Kumara Dissanayake raised the shocking disclosure made by ICIJ in Parliament, Leader of the House and Education Minister Dinesh Gunawardena pointed out that the case was now before court.

Lawmaker Dissanayake was addressing Parliament on Oct 8, the day the CIABOC recorded Nadesan’s statement. Minister Gunawardena was referring to the controversial case pertaining to Malwana house.

SLPP National List MP Jayantha Weerasinghe, PC, challenged Dissanayake’s comments. Declaring that he appeared for Thirukumar Nadesan in court, Weerasinghe emphasised that no one in Parliament represented the businessman’s interests. Weerasinghe said that Nadesan was an accused in that case.

 Dissanayake also raised the controversial Gin-Nilwala project and the transfer of funds to Nadesan’s account by a Chinese company that received a staggering Rs 4,012 mn in two separate transactions from the then Sri Lankan government around the time of the 2015 presidential election. The SLPP repeatedly interrupted MP Dissanayake. A smiling JVPer said that though the SLPP claimed no one in Parliament represented the interests of Thirukumar Nadesan, many spoke on his behalf.

Matara District Communist Party member Weerasumana Weerasinghe was in the chair.

The reference to money received by Nadesan from the Chinese company given the Gin-Nilwala project amounted to USD 5.9 mn. Dissanayake told The Island that the account that had received USD 5.9 mn was a Hong Kong account.

TISL, in its website tweeted that particular section of MP Dissanayake’s parliamentary speech. The social media coverage of Pandora Papers underscored the seriousness of the crisis faced by Sri Lanka.

A dismal track record

Civil society activist Gamini Viyangoda in April this year sought an explanation from the CIABOC and the Attorney General’s Department as regards termination of several high profile cases. Viyangoda questioned the rationale in dropping all charges against former lawmaker and Foreign Ministry Monitoring MP Sajin Vass Gunawardena pertaining to the Mihin Lanka case. That particular case dealt with misappropriation of public funds amounting to Rs 883 mn, Viyangoda declared while referring to recent dismissal of cases involving one-time Eastern Province Chief Minister Sivanesathurai Chandrakanthan alias Pilleyan (now an MP backing the SLPP), Johnston Fernando, Rohitha Abeygunawardena, Basil Rajapaksa, Mahindananda Aluthgamage, Janaka Bandara Tennakoon and former Chief Justice Mohan Peiris. The former CJ received appointment as Sri Lanka’s top representative in New York.

Jayantha Jayasuriya, PC, who served as the AG during the Yahapalana administration is the incumbent Chief Justice.

 What really happened to the money laundering case (HC case No 4648/2009) involving the then parliamentarian Ravi Karunanayake, who subsequently received the appointment as the Minister of Finance during the previous administration. The money had been received from Raj Rajaratnam, given an 11-year prison sentence for insider trading in the US.

The case that had been initially taken up at the HC No 01 was subsequently (May 2015) transferred to High Court No 4 before HC Judge Iranganee Perera who was about to be retired. On the basis of what was called a defective indictment Judge Perera discharged Karunanayake while making specific legal right of the Attorney General to serve an indictment afresh to the accused Ravi Karunanayake. Obviously, that was conveniently ignored. Yuvanjana Wijayatilake served as the AG at that time.

Attorney-at-Law and public interest litigation Activist Nagananda Kodituwakku in an affidavit submitted to the CIABOC in March 2017 sought an investigation in respect of the failure on the part of the AG’s Department to act on the advice given by HC judge Perera. Kodituwakku asserted that the alleged offence committed could have been dealt with under Section 70 of the Bribery Act.

A monument for ICIJ

 A no-holds-barred investigation is required to examine high profile corruption allegations. So far, the CIABOC hasn’t been able to bring at least one of the cases involving politicians to a successful conclusion. It would be pertinent to mention incumbent Speaker Mahinda Yapa Abeywardena’s response to waste, corruption and irregularities.

Speaker Abeywardena said contentious matters pertaining to financial responsibility on the part of Parliament should be dealt with only by the enactment of a new Constitution.

The SLPP MP said so in response to Prof. Charitha Herath, Chairman of the Committee on Public Enterprises (COPE) alleging serious hindrance of parliamentary supervision by a section of state enterprises. Prof. Herath explained the daunting challenges faced by COPE at the time he tabled the first COPE report at the outfit’s ninth session.

Proceedings of parliamentary watchdog committees, COPE, COPA (Committee on Public Accounts) and COPF (Committee on Public Finance) depict a frightening picture.

Unfortunately, Parliament has conveniently failed to take tangible measures though the three watchdog committees reported rampant criminal waste of public funds, corruption, irregularities involving the revenue collection mechanism and negligence at every level of successive administrations.

Have those responsible for ensuring financial discipline forgotten the primary responsibilities of Parliament. The two major responsibilities are financial discipline and enactment of laws. Let people judge whether our political parties have lived up to their much repeated pledges to restore financial discipline. Examination of proceedings of the watchdog committees revealed how the public and private sectors exploited the national economy. Fighting corruption appears to be a just a political slogan propagated by both those in power and the Opposition.

 The Joint Opposition (JO registered themselves as SLPP) in the run up to 2019 presidential election conducted a major campaign against what it called ‘Top 10 Kamba Horu.’ Incumbent Agriculture Minister Mahindananda Aluthgamage spearheaded the project. The JO printed a 750-page book that dealt with 10 major corrupt deals that took place between January 8, 2015 and Dec 31, 2015. The JO alleged that the CIABOC never initiated investigations into complaints lodged by the JO. The SLPP owed an explanation regarding the current status of the complaints lodged by them because the party returned to power, nearly two years ago.

 According to the JO publication, in the public domain, complaints were lodged against Ranil Wickremesinghe, MP, pertaining to the Treasury bond scams, on Oct 29, 2016 (Rs 26 bn fraud/complainant Vasudeva Nanayakkara, MP), ex-MP Ravi Karunanayake pertaining to importation of vehicles, on Nov 09, 2016 (Rs 10 bn fraud/complainant Dr. Romesh Pathirana, MP), ex-MP Malik Samarawickrema pertaining to Mahapola Fund, on Nov 22, 2016 (Rs 1 bn fraud/complainant Sisira Jayakody, MP), Thalatha Atukorala, MP, pertaining to fraud in an insurance scheme for those working in the Middle East, on Dec 07, 2016 (Rs 1.5 bn fraud/complainant ex-MP Niroshan Premaratne), Ranil Wickremesinghe pertaining to 99-year-lease on Hanbantota port, on January 4, 2017 (Rs 15 bn/complainant Mahinda Yapa Abeywardena, MP, Speaker), Kabir Hashim, MP, pertaining to cancellation of aircraft ordered by SriLankan Airlines, on January 18, 2017 (Rs 54 bn fraud/complainant Kanaka Herath, MP), P. Harrison pertaining to releasing of paddy to a selected group of companies, on Feb 01, 2017 (Rs 10 bn fraud/complainant Jayantha Samaraweera), ex-MP Ravi Karunanayake pertaining to vehicle racket, on Feb 15, 2017 (Rs 15 bn fraud/complainant Udaya Gammanpila, MP), Dr. Rajitha Senaratne MP pertaining to leasing of Modera fisheries harbour and issuance of licenses to eight vessels for fishing in Sri Lankan waters, on Feb 28, 2017 (Rs 1 bn fraud/complainant the late MP Ranjith de Zoysa) , Dr. Rajitha Senaratne pertaining to irregularities in the purchase of medicines, on Feb 28, 2017 (Rs 1.5 bn fraud/complainant the late Ranjith de Zoysa) and Ranil Wickremesinghe, MP pertaining to procurement of coal for the Norochcholai coal-fired power plant, on March 16, 2017 (Rs 5 bn fraud/complainant Vidura Wickremanayake, MP).

 The JO declared the above mentioned frauds cost the country a staggering Rs 131.5 bn.

Parliament, as an institution, at least now should respond to corruption. In the wake of Pandora Papers disclosures, social media posted a speech made by SLPP Polonnaruwa District MP Maihripala Sirisena, in his capacity as the President. Sirisena dealt with the Gin-Nilwala project. What Sirisena, who contested the last general election in Aug 2015 on the SLPP ticket, said was astonishing. The government transferred Rs 1,000 mn to a Chinese company in 2012 for the implementation of the Gin-Nilwala project and another Rs 3,012 mn on January 7, 2015 to thereby bringing the total amount paid to Rs 4,012 mn. Sirisena questioned how such a transfer could have taken place on the day before the presidential election? Who authorised such a transfer and why absolutely no work was done regardless of the payments. Lawmaker Sirisena owed an explanation during his five-year tenure as President what he did to investigate the Gin-Nilwala project. Perhaps, the Gin-Nilwala link disclosed by Pandora Papers, if properly investigated, can cause such devastation to the current political setup, the public can consider putting up a monument to ICIJ.



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Midweek Review

JRJ’s racism, cold war posturing and the Indian debacle

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New biography:

In addition to his political biography of J R Jayewardene, Godage & Bros published last month another book of travel by Rajiva Wijesinha. Around and About the Mediterranean covers journeys over half a century to Southern Europe, Northern Africa, and the Levant from Jordan up to Turkey. It also includes travel to the Balkans, Yugoslavia in 1972 and then the separate countries of the former Yugoslavia in the last five years.

Bringing together the Classical and the Christian and the Islamic cultures of the region makes for a fascinating read for it shows the intermingling that has made the Mediterranean so productive of ideas as well as artefacts. In addition, the book shares with readers the sheer joy of travel, the wonders seen and the pleasure of strenuous exploring followed by relaxation in scenic surroundings. There are several colour pictures as well as black and white ones to illustrate each section.

By Shamindra Ferdinando

An opportunity to peruse Prof. Rajiva Wijesinha’s critical biography of Sri Lanka’s first executive President (not elected), titled ‘J.R. JAYEWARDENE’S RACISM, COLD WAR POSTURING AND THE INDIAN DEBACLE’, couldn’t have been received at a better time.

The country is in turmoil with a wave of protests, with farmers’ now leading the way over the SLPP government agricultural policy, a simmering dispute with China regarding a ship carrying allegedly contaminated carbonic fertiliser consignment entering Sri Lankan waters, unprecedented balance of payment crisis, and a deepening disagreement with SLPP constituents over a deal with the US company New Fortress Energy, as well as foreign policy issues.

Can Sri Lanka’s current predicament be blamed on the executive presidential system, failure on the part of Parliament and the judiciary – the three pillars on which the country’s political system is based? Academic, administrator and ex-lawmaker who had represented the utterly corrupt SLFP and UNP-led political groupings (2010-2015 in Parliament), Prof. Wijesinha has launched this devastating attack on the late UNP leader JRJ but, overall, the JRJ biography seemed an extremely harsh critique on the political setup he established. But, the irony is the author himself had been part of the two major political groupings after having performed an immensely valuable role as the Secretary General of the Secretariat for Coordinating Peace Process (SCOPP) in addition to being the Secretary to the Disaster Management and Human Rights Ministry.

The writer really appreciate an opportunity to review ‘J.R. JAYEWARDENE’S RACISM, COLD WAR POSTURING AND THE INDIAN DEBACLE’ against the backdrop of The Island celebrating its 40th anniversary at a time the country is experiencing an unprecedented financial crisis. Prof. Wijesinha has basically dealt with the period The Island and its sister paper, Divaina played a critically important role.

Before delving into Prof. Wijesinha’s quite useful analysis, it would be pertinent to mention that as a UPFA National List MP, the academic, in spite of strong opposition from a section of his Liberal Party, voted for the dictatorial 18th Amendment to the Constitution that was passed on Sept. 18, 2010. The 18th Amendment that had been brought in at the expense of the 17th, introduced during Chandrika Bandaranaike Kumaratunga’s tenure as the President, literally placed the executive, the legislature and the judiciary under the President’s thumb. The judiciary cannot absolve itself of the responsibility for protecting and nurturing the Constitution if/when the executive or Parliament violated the Constitution, or both did, simultaneously. The UPFA initiated impeachment proceedings, close on the heels of the Supreme Court having deemed actions taken against then CJ Shirani Bandaranayake constitutional. Bandaranayake was accused of financial impropriety and interfering in legal cases among other allegations- all of which she denied, but her husband was involved in some banking shenanigans and he was convicted.

Wijesinghe, as an MP, however abstained from backing the impeachment motion against then C J Bandaranayake in early January 2013. A year later, Prof. switched his allegiance to a high profile yahapalana political project, spearheaded by the late Ven. Maduluwawe Sobitha Thera and Ven. Atureliye Rathana, MP (now NL MP of Ape Jana Bala Pakshaya) that facilitated the break-up of the powerful UPFA and the emergence of long standing SLFP General Secretary Maithripala Sirisena as the Opposition presidential candidate.

With Sirisena taking over as the President in January 2015, Prof. Wijesinha received appointment as State Minister of Higher Education. However, Prof. Wijesinha resigned on Feb 17, 2015 opposing the then Premier Ranil Wickremesinghe’s move to secure executive powers for himself as the Prime Minister. Prof. Wijesinha declared the move to gazette the 19th Amendment to the Constitution and transfer of executive powers to the Prime Minister was both ill-timed and a wrong decision, thus, he could no longer be a part of the yahapalana government.

Prof. Wijesinha alleged in Parliament the transfer of executive powers to the Prime Minister was extremely dangerous when one considered the way the UNP leader was conducting himself. Prof. Wijesinha certainly didn’t receive public appreciation for shifting of allegiances from various political alliances within a very short period, first to the short-lived Sirisena–Wickemesinghe combination, and then declare support for Sirisena, at the expense of Wickremesinghe, and finally ending up with those who he abandoned in 2014. Sirisena, who led the charge against the Rajapaksas, had ended up among the same group whom he accused earlier of planning to assassinate him.

Jeyaraj’s arrest in the wake of Indo-Lanka Accord

Prof. Wijesinha dealt with how the JRJ government arrested the then The Island journalist David Buell Sabapathy Jeyaraj over the reportage of the Indian Army offensive in the Jaffna peninsula. The former parliamentarian reproduced an apt section of Jeyaraj’s report that discussed the ground situation in the peninsula. Having joined The Island, in June 1987, the writer remembers the subsequent developments that paved the way for Jeyaraj to leave for the US. The versatile writer ended up in Canada. New Delhi continuously interfered with print media cov­erage of the violence in the Northern and Eastern parts where the Indian Peace Keeping Force waged a bloody campaign to tame the Liberation Tigers of Tamil Eelam (LTTE) after it turned its wrath against them.

Once the Criminal Investigation Department (CID) sleuths visited The Island editorial to question Norman Palihawadana over his coverage of atrocities committed by the Indian Army in the Eastern theatre of operations. Jeyaraj left the country in Sept 1988, two years before after India ended its disastrous military mission here. The prolific writer for the first time returned to Sri Lanka in Oct 2013 – four years after the military eradicated the LTTE completely.

The section on the Provincial Council legislation, when examined with how JRJ handled the judiciary, is thought-provoking and is evidence the legislature lacks the strength to counter overwhelming executive (dictatorial) powers, regardless of opposition by some lawmakers. The resignation of the late much respected Gamani Jayasuriya over the passage of Provincial Council legislation is a case in point.

‘J.R. JAYEWARDENE’S RACISM, COLD WAR POSTURING AND THE INDIAN DEBACLE’ published by S. Godage and Brothers should be made available in the library of the Parliament .The author should consider getting the book translated to Sinhala and Tamil, too, for the benefit of lawmakers unable to make use of the JRJ biography. The writer brought the new book to the attention of the Chief Librarian of Parliament and the pivotal importance of making it available to the lawmakers, over the last weekend.

Prof. Wijesinha discussed how JRJ brazenly amended and manipulated the Constitution, suppressed internal dissent and if the dictator had his way he would have deprived Ranasinghe Premadasa of an opportunity to contest the 1989 presidential election. At the onset of his new book, Prof. Wijesinha pointed out how JRJ brought in his first amendment to the Constitution to subvert a judgment of the courts.

Corruption becomes way of life

Prof. Wijesinha boldly discussed the impact the absolutely corrupt political system in place as a result of deterioration of parliamentary norms is having on the country. The latest JRJ autobiography has contradicted those who published hagiographies of the former President. Prof. Wijesinha compared the late JRJ with Ranil Wickemesinghe whom he described as JRJ’s spiritual heir. Having referred to their strategies in dealing with Tamil speaking people, Prof. Wijesinha repeated his long standing claim of Wickremesinghe bribing SLMC leader Rauff Hakeem in 2014 to win over his support ahead of the 2015 presidential election. Wijesinha first made the accusation in a widely watched Sirasa ‘Pathikada’ programme anchored by the late Bandula Jayasekera, one-time presidential spokesman and the writer’s colleague at The Island editorial. Prof. Wijesinha says Muslim politicians continue to cross up and down, depending on what they are offered.

Prof. Wijesinha publicly alleged years before the launch of JRJ biography how the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) sat on his complaint on the bribery accusation. The academic declared that the UNP received money to engineer a crossover of over a dozen People’s Alliance lawmakers in 2000 from businessman Nahil Wijesuriya.

Referring to the Rubber-Rice pact with China finalised in 1952 and the despicable role played by JRJ, Prof. Wiejsinha briefly examined the 99-year-old lease on the strategic Hambantota port in 2017. Prof. Wijesinha blamed the then President Sirisena, Premier Wickremesinghe and International Trade Minister Malik Samarawickrema for the Hambantota sell-out to varying degrees. The author quite rightly faulted an influential section of the media for continuously attacking the Rajapaksas for selling family silver to the Chinese whereas the UNP-led administration pushed through the deal.

The incumbent government has had no option but to accept the controversial Hambantota deal. Interestingly, the government is now under fire for giving into the US strategy to take over Sri Lanka’s energy security. The author of the JRJ biography may not agree with the writer, but the undeniable truth is all governments since the advent of UNP at the 1977 parliamentary election contributed to the deterioration of democracy and sovereignty. The 20th Amendment enacted in Oct 2020 with a 2/3 majority is a case in point. With the advent of the 20th Amendment, the much discussed abolition of the executive presidency or curbing of its powers will not be subject to discussion though some may make some statements opposed to the executive presidential system.

Perhaps Prof. Wijesinha should have discussed how Wickremesinghe received the premiership in January 2015 in the aftermath of Sirisena’s victory. JRJ’s political strategy has been exploited by interested parties to deceive the public that victory at the presidential election provided a mandate for them to take over the government. Sirisena and Wickremesinghe did exactly that. If not for the manipulation of the system, Wickremesinghe wouldn’t have received the premiership in January 2015. Prof. Wijesinha wouldn’t have to resign in Feb 2015 and Treasury bond scams would not have been perpetrated.

JRJ biography in three parts

The civil society, the diplomatic community, the media and the general public can benefit from Prof. Wijesinha’s incisive thinking. In part I, the author discussed (a) overview of JRJ’s political perspectives (b) Tamil parties (c) much amended Constitution (d) election and having ministers at his whim and fancy (e) 1982 Referendum. Basically, part 1 dealt with the building up of the colossal power base. Part 11 discussed (a) alienation of Tamils (b) riots after killing of 13 soldiers in Jaffna (c) slide towards concessions (d) Indian interventions and (e) Indian military deployment. This section was aptly titled ‘A slow but relentless decline.’

The final part titled ‘And the Fall’ dealt with (a) Indo-Lanka Accord (b) India’s war against the LTTE (c) elections and increasing violence and (d) a new President.

The writer found Chapter 5 that examined the 1982 Referendum meant to prolong the life of Parliament regardless of consequences. JRJ introduced the 4th Amendment which Prof. Wiejsinha described as the worst of the then UNP leader’s constitutional amendments that paved the way for his party to rule the country from 1977 to 1989. The JRJ strategy ruined the country. The second JVP inspired insurgency, India inspired Tamil terrorism and trade union disputes wrecked the country during this period. Prof. Wijesinha lucidly explained how the then Attorney General Siva Pasupathy, who subsequently threw his weight behind the LTTE and Chief Justice Neville Samarakoon reacted to the controversial move.

Prof. Wijesinha called Pasupathy an obsequious man who had no qualms in his ‘pernicious bidding’ and Samarakoon as JRJ’s handpicked man was truly forthright. Prof. Wijesinha coverage of the judiciary’s response to a despicable move to extend the life of Parliament provides an opportunity for those interested in contemporary history to understand how the executive, the legislature and the judiciary collectively caused irreparable damage to the democratic system.

The assassination of actor-turned politician Vijaya Kumaratunga in Feb 1988 should be examined taking into consideration Prof. Wijesinha’s comment on the UNP strategy meant to politically destroy the much loved man. Having had categorised Kumaratunga as a Naxalite, the UNP imprisoned him during the dubious 1982 Referendum campaign. Let me reproduce verbatim what Prof. Wijesinha stated on alleged Naxalite plot: “Gamini Dissanayake, who was then firmly under JR’s thumb, also got in on the act and claimed that ‘the leader of the Naxalites is Vijaya Kumaratunga’ and his assistant Chandrika. Meanwhile, The Sunday Times, which was then fully controlled by the government, with the easily intimidated Rita Sebastian as its editor, published a list of eight Naxalites, namely, in order (1) Vijaya Kumaratunga (2) Chandrika Kumaratunga (3) Ratnasiri Wickramanayake (4) Hector Kobbekaduwa (5) T.B. Illangaratne (6) K.P. Silva (General Secretary, Communist Party), (7) G.S.P. Ranaweera (Editor, Aththa) and (8) Jinadasa Niyathapala.

Prof. Wijesinha commented on the media, including the birth of the Upali Newspapers Limited (UNL) and the disappearance of its founder Upali Wijewardene in the wake of Ranasinghe Premadasa thwarting JRJ’s move to field the top entrepreneur to contest the Kalawana electorate. The UNL received Prof. Wijesinha’s appreciation for opposing the Referendum, though mildly, whereas the state-owned media and Dawasa Group threw their full weight behind JRJ’s despicable move. The government engaged in violence in support of its political project. The author discussed how JRJ unashamedly used sections of the media and selected journalists for the project that gave his party the opportunity to govern the country for a period of 13 years, sans parliamentary elections.

A bizarre strategy

Prof. Wijesinha explained how JRJ adopted bizarre political strategies. Having undated letters of resignation from his MPs is one such shameful tactic. JRJ played politics with the system to restrict the number of by elections (remember, this was before the introduction of the PR system in 1989). The section titled ‘Flexing muscles in 1983’ under Chapter 5: Referendum underscored how JRJ consolidated unbridled power at the expense of Parliament and the Judiciary. JRJ ruined institutions at will. Parliament was among them. During a recent interview on ‘Siyatha’ , one-time President Maithripala Sirisena explained how successive Presidents brought in Amendments to consolidate their power at the expense of the people. Sirisena, quite rightly claimed that he was the only President to give up power by way of introducing the 19th Amendment to the Constitution in 2015. However, the irony is Sirisena, in his capacity as the SLFP leader, allowed his parliamentary group to vote for the 20th Amendment that neutralised the 19th. Lawmaker Sirisena quite conveniently refrained from voting for the 20th Amendment having explained his predicament to President Gotabaya Rajapaksa. Having accused the Rajapaksas of planning to bury him, Sirisena, who has been named in the Easter Sunday Commission report for possible prosecution for dereliction of duty, ended up as an SLPP lawmaker.

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Midweek Review

Can Budget 2022 resolve national crisis?

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By Dr. Laksiri Fernando

It is extremely unlikely that the present budget could resolve the evolving national economic crisis, not to speak of the political disorder emerging out of it. In fact, during the Parliamentary debates on the second reading, the main oil refinery at Sapugaskanda was shut down due to non-availability of crude oil supplies. This is a result of the foreign exchange crisis, which the present Budget has unfortunately not even attempted to resolve.

Instead of obtaining crude oil and refining them to fulfil the fuel requirement of the people, now the Ministry of Energy is ready to import petrol, kerosene, and diesel at higher prices. At present, there are severe shortages of all these items in addition to gas, in the country.

To obtain crude oil from Nigeria, as previously agreed, the Ministry required around $ 2.5 billion, from May until December. The Central Bank understandably has not been able to offer these dollars as foreign reserves were limited to around $ 3 billion. The government, however, has allowed the Minister of Energy, Udaya Gammanpila, to obtain refined oil (crude oil perhaps later) from Oman (3.6 b) and India (.5 b) on foreign loans and deals amounting to $ 4.1 billion.

Unplanned and haphazard obtaining of foreign loans is not a solution to the fuel crisis or the foreign exchange crisis. These are the results of indecision, wrong decisions, or reversal of decisions, perhaps a reflection of differences or rifts within the government. It is primarily for the foreign exchange crisis that the Budget 2022 does not offer any solution, although it boasts of ‘challenging the challenges.’ For example, the following is the view of the Minister of Finance, Basil Rajapaksa, on ‘foreign exchange reserves’.

“The government of HE the President Gotabaya Rajapaksa, expects to create apart from a foreign exchange reserves a number of other reserves. The first of which is the reserve of water, food, and energy, which are created through the land, water, and the renewable energy which are gifts of nature.”

He states the above just before the section on ‘Identifying Potential Exports’ on page 15 of the Budget speech. Does he think that creating foreign reserves is like reserving water, food, and energy? Perhaps he is correct, considering the shortages of food, fuel, energy, or even clean water in the country, at present.

Requirements of a Budget

A Budget in a country like Sri Lanka should address three main balance sheets in the economy. This is common to many countries, but given the crisis in all three spheres in Sri Lanka, the balance of state’s income and expenditure should not be the only focus.

The three requirements are as follows: (1) the balance of payments to mean the country’s foreign (dollar) income and expenditure, deficit, debt, aid, and loans. The exchange rate is also important. (2) The balance of trade to mean the country’s exports and imports, trade deficit, nature of exports (primary, secondary, or tertiary). In the case of Sri Lanka, the status of tourism and export of labour. (3) The state expenditure and income in detail with proper breakdowns on capital and recurrent expenditure on social welfare, investments promoting development, direct and indirect taxes and profits and losses of state enterprises.

It is customary for all of us to call a budget, the ‘budget of the government.’ But it is of the state, the people being the main stakeholder. In a democracy, the government is merely the officeholder or the servant.

When one goes through the ‘Budget Speech’ or the ‘Annexes,’ the necessary information on the above three aspects of a proper Budget, the identification of problems in all three areas, and genuine proposals to resolve them are absent. That is another reason why the present budget is far from being able to resolve the present national crisis. The Budget speech of the Minister was like a ‘Throne Speech,’ more rhetoric than a genuine analysis. The balance of payments or the balance of trade are not properly covered. There are obvious structural defects in the Budget, Budget planning and presentation.

The attached annexes are limited to four, titled; ‘Summary of the Budget (2021-2022),’ ‘Gross Borrowing Requirements,’ ‘Revenue Proposals 2022,’ ‘Expenditure Proposals,’ and ‘Taxation.’ Most of the tables are quite callous and some do not even give the totals! These are compiled by the Department of Fiscal Policy among others. The ‘Summary of the Budget’ itself proves the main criticism of this article, no data on balance of payment or balance of trade. The summary is mainly limited to (government) ‘revenue’, ‘expenditure’ and proposed ‘financing.’

Summary

Let us take the ‘summary of the Budget’ on face value. The table also gives ‘estimated’ figures for 2021, correct or not. The figures are given as if the deficit is already fixed. That cannot be the case and any burden from this year would go to the next year of the present Budget.

Optimistically, the table gives the revenues first. Accordingly, the (estimated) revenue for 2021 is Rs. 1,561 billion, and for 2022 it would be 2,284. An increase of Rs. 723 billion. This could be the case, hopefully, given the new taxes introduced, and taxes of the last Budget not implemented, reintroduced. The estimated expenditure of the last budget was Rs. 3,387 billion and this budget is 3, 912. Of course, it is not a big increase, given the present crisis, but it is doubtful whether it would be sufficient to alleviate the stagnating economy. On the other hand, the Keynesians might argue for increased spending to stimulate the economy.

For example, in the last budget, the domestic deficit was Rs. 1,826 billion. In the present budget it is Rs 1,628 billion without a big difference or a purpose. The most important in a developing country is not so much the budget deficit, but how you plan to finance the Budget deficit, and more importantly how you plan to spend public funds. It is important that expenditure on provincial councils is increased from Rs. 1,085 billion to Rs. 1,218 billion. While this is marginal, these go like other expenditure to recurrent matters such as salaries, wages and necessary goods and services.

Sri Lanka is within this vicious cycle of subsistence budgeting. Public investment was limited to Rs. 581 billion in the last budget, and to Rs. 931 billion in this Budget. Considering the inflation, this increase is nothing much, and most important is how even these amounts are spent, and for what.

The way the deficits are financed is also dubious or problematic. In the 2021 Budget, Rs. 978 billion was expected from foreign sources as gross borrowings and loans. In the present Budget, Rs. 1,016 billion is expected from the same sources. The table also (not so clearly) reveals the amounts that the country must pay back, Rs. 536 billion in the last budget and an expected Rs. 866 billion in the present Budget. The same goes for domestic obligations in borrowings, although not of that gravity.

‘External budget’

The main crisis Sri Lanka is facing is in respect of what I would call the ‘external budget.’ This means the trade deficit, balance of payment deficit, depleted foreign reserves, exchange rate and the external debt. On these matters, no tables or accounts are given in the annexes. Even in the Budget speech very little attention is given to these; nonetheless unbelievable targets and figures are attached. This is limited to two pages, 73 and 74.

It may be correct to say, as the Minister has stated, exports of the country reached $ 10,028 million by last month (October). This undoubtedly shows the potential. Therefore, his target of $ 11,900 million for the whole year can also be reasonable. However, his target of limiting import bill to $ 18,900 million for the year is an underestimation given the present ‘open’ policies of the government. Thus, the estimated trade deficit of $ 7,000 million for the year is also an underestimation.

Most questionable are his predictions for 2022 and beyond. He says, “In 2022, a trade surplus is expected amounting to around USD 1,000 million, including from tourism, ports, and IT export services and I have spelt out policies and measures in this Budget speech to increase it to USD 8,000 million in 2027.” (p.74).

Even if the trade deficit could be limited to $ 7,000 million this year by some luck, how come in 2022, a trade surplus of $ 1,000 million be achieved? It would be a miracle. It is true that the Minister has ‘spelt out’ some policies and measures promoting tourism, ports, and IT export services. Revenue from foreign employment also could be added. Yet a trade surplus of $ 1,000 million next year would be unachievable, realistically. A budget should be realistic and not idealistic.

It is customary in contemporary budgets to formulate projections for the future beyond the budget year (2022). However, these projections should be realistic based on data, careful analysis and realistic estimates. Increasing the trade surplus therefore to $ 8,000 million in 2027 appears just rhetoric to deceive the people. Under the circumstances, it is difficult to believe that the present Budget could resolve the present national crisis outlined in my previous article

(Sri Lanka Heading for Serious Crisis)

in the areas discussed, among others.

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Midweek Review

The brain drain disaster: Where are we heading?

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by Rasanjalie Kularathne and Dr.Manoj Samarathunga

“I’m not happy to live in Sri Lanka” – a housewife

“I can earn more money if I go abroad” – a doctor

“I want my children to have a better future” – a school teacher

“Sri Lanka is on an economic bomb” – a university lecturer

“Many of our politicians and government officers are corrupted” – a social activist

Brain drain reflects multiple underlying socio-economic problems. While we expect to see a better country after the natural disasters, wars, terrorist attacks and pandemics, a more serious threat looms; it may appear insignificant to the majority of the people, especially to the politicians and policymakers, yet it is something we should counter immediately as a national priority. Therefore, based on a series of interviews with professionals who have either migrated or are planning to do so we present some important facts about Sri Lankan ‘brain drain’.

The development of any country depends on its human capital. Similarly, the success of any organisation hinges on the performance of its competent workforce. The question is whether this qualified workforce will remain in Sri Lanka, a few years hence? All the professionals,we interviewed, are desirous of leaving the country due to many reasons, including, but not limited to, economic turndowns, coups and political instability, human rights violations, thoughtless bureaucracy, the absence of national policies aimed at development, bribery and corruption.

In this context, there is an ever-increasing number of youth who desire to pursue professional careers and expect attractive remuneration packages. Then again, the question is whether there are enough opportunities available for them in the country, or whether there are any policies in place or actions being taken to create them. If not, the youth, opt for foreign employment.

Migration is triggered by push factors, including adverse/unfavourable economic conditions, lack of employment opportunities or the general low wage levels, abusive marriages, domestic violence, lack of social freedom and unstable political governance, and pull factors, such as the host country’s favourable salaries, better quality of life, freedom/or independence, and the growing need for workers in the destination country.

Sri Lankan youth view migration as an opportunity for better employment prospects. The migratory mindset is widespread among the Lankans today, as can be seen from the winding queues near the ‘passport office’. Migration for a “better future” is a dream of many educated youth from urban and rural backgrounds. Most of the migrants, in Sri Lanka, are between 25 and 39 years.

Sri Lankans, who study overseas, return home only to find that there are no jobs available for them in their chosen disciplines. The only choice they are left with is to leave the country in pursuit of employment that is relevant to their disciplines, and better pay. After migrating to the countries of their choice, many Sri Lankans become permanent citizens, and their families also migrate. As a result, many who benefited from free education in Sri Lanka are now employed abroad. Therefore, the human resource capacity within the country, is low.

The skilled job seekers, especially carpenters, bricklayers, masons, drivers, technicians, and mechanics, have a high demand in the Middle East, European and Pacific countries. Many young women, living in the peripheral areas have no choice but to work as housemaids in the Middle East because they find the living conditions, and the cost of living, unbearable. Many people have become virtual slaves. Many others fall prey to human traffickers. Illegal migration troubles Australia, which is working with the Sri Lankan authorities to prevent it. Illegal migrants face sexual harassment, human rights violations, among other things.

Sri Lanka is experiencing a shortage of skilled professionals in many disciplines such as health, apparel, manufacturing, IT, business process outsourcing, tourism, and jewellery. As per the World Bank, in Sri Lanka, only 1.004 doctors are available and 2.18 nurses and midwives were available per 1000 patients in 2018. Every year, around 60 doctors leave for the UK, Australia, Canada, and other developed countries to undergo their one-year compulsory training, but only half of them return, exacerbating a growing crisis in healthcare services. Similarly, many university academics who leave the country to pursue higher education overseas, never return. Ekanayake, Anoji and Amirthalingam (2018) conducted a study on ‘Impact of Migration of Sri Lanka Professionals to Qatar” and they found that 70% of Sri Lankan professionals prefered to stay in Qatar far longer than they anticipated. They are also less likely to return to Sri Lanka for work in the near future. Around 39% did not prefer to return to sri Lanka. Nearly 30% of these professionals aim to secure new jobs in Qatar or other Gulf nations after their present contracts expire, while nearly 21% seek to migrate to countries like Australia, Canada, New Zealand, etc. without returning to Sri Lanka.

If this trend continues, Sri Lanka will face a problem where the nation’s ‘brains’ aren’t contributing to the country’s future and there’s a tremendous flow of money going outside. To discourage international migration and stimulate ‘brain gain’ instead of ‘brain drain’, Sri Lanka needs to take appropriate measures as follows:

* Ensuring political stability in Sri Lanka;

* Introducing policies to enhance economic conditions and stimulating development;

* Discouraging bribery and corruption by enforcing the law strictly;

* Focussing on formulating strategies to keep skilled employees within the country by offering suitable employment opportunities and better facilities, realising that migration is caused by push and pull factors.

* Controlling inflation and increasing national productivity

* Strengthening the existing lawss, rules and regulations to avoid human rights violations, harassments, and discriminations;

* Attracting expatriate Sri Lankan professionals by offering them suitable positions and competitive salaries;

* Encouraging more multi-national companies to invest in Sri Lanka so as to create international level job opportunities to Sri Lankans;

* Forecasting the future human resource needs of the country and developing the existing workforce to meet future needs;

* Encouraging the professionals who have migrated to contribute to Sri Lanka’s development through different development and social responsibility projects.

(The writers are attached to the Faculty of Management Studies, Rajarata University of Sri Lanka. They could be contacted at rasanjaliek555@gmail.com )

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