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Govt. to receive USD 780 mn via IMF SDR facility to get over COVID difficulties

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State Minister Ajith Nivard Cabraal says Sri Lanka will receive USD 780 mn in terms of Special Drawing Rights (SDR) in support of efforts to meet difficulties caused by the Covid-19 crisis. Asked whether the government had agreed to a programme, the former Governor of the Central Bank Cabraal said that the funds were made available to all countries regardless of a programme.

Pointing out that the total IMPF allocation was about USD 650 bn, Sri Lanka was entitled to USD 780 mn.

Top SJB spokesman Dr. Harsha de Silva, MP said that  every IMF member nation would get their share of the USD 650b new allocation to be used in any manner they wished but mostly for Covid-related expenses.

The MP said: “These allocations have taken place several times in the past as well. This time the proposal was stuck during the Trump administration but cleared by Biden.

Going to the IMF or not to resolve our debt issue is a separate matter. That is the decision of the government.

But the reality is that we are now on very thin ice because even with this windfall our official reserves will be around USD 3b at the end of August. And once the gold is removed, reserves will be around USD 2.5b. Then even if the reserves of all private banks and entities are added, at a national level usable reserves would be around USD 4.5b by the end of the month. But we have, both government and private sector, close to USD 7b in debt payments alone in the coming 12 months.

As we just saw last week the import ban is not working and the trade deficit is ballooning while remittances are falling and tourism is stuck. This means we will run a deficit in the current account of the balance of payments.

The result is additional requirements for reserves to meet imports.

Now I heard the Minister saying to CNBC that he expects USD 400m from India and USD 250m from Bangladesh. But these swaps are all very short term loans. A few months max. Maybe some additional money may come from China Development Bank etc. He said he expects anywhere from USD 400m to USD 1b from ‘utilizing underutilized assets’ in other words privatisation. This is I presume via Selendiva, but I am at a loss to figure out what would need to be sold to get that amount. That is still a one off inflow. Beyond that the much talked about FDI to Port City and elsewhere has not materialised and even if it does only a fraction would go to reserves as most would be spent on imports.

So even they have been harping on an ‘alternative’ no one has explained what it is.

So yes, I don’t see any other option but to approach the IMF to work out a facility to bail Sri Lanka out of the hole this government has put us into, starting from the unwise tax cuts in December 2019 and multiple blunders since, besides the pandemic. If they went to the IMF in late 2020 we could have settled at around LKR 190 to the dollar. If they go now perhaps around Rs 215 to Rs 220 and if we delay further then at a further depreciated rate. The choice is theirs but given the situation they have put us all into there is no way we can come out of this without the help of the IMF either now or 6 months down the road.

The MP said that instead of keeping the country open and letting thousands die because of their logic of the need to keep the economy moving, what they need to do is enter into a program with the IMF to restructure the debt and get a breather and close the country based on medical expert advice.”



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Jaya Sri Maha Bodhi premises becomes a net zero carbon emission zone

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President Ranil Wickremesinghe announced plans to implement a program aimed at transforming Anuradhapura, once a major trade and economic center, into a globally renowned city. He emphasized the need to highlight Anuradhapura’s cultural, educational, commercial, and economic values and to initiate archaeological research to bring its significance to the world stage. While cities like Tanjore, Madras, and Sanchipuram receive global attention, Anuradhapura has yet to be developed to the same extent.

The President mentioned that he would discuss these plans with the Director General of UNESCO, who is visiting Sri Lanka this week. Several universities worldwide have already expressed interest in supporting these initiatives.

President Wickremesinghe made these remarks during the ceremony to commission the 150-kilowatt solar power system installed by the LTL Group at the historic Jaya Sri Maha Bodhiya premises in Anuradhapura on Saturday (13) morning . He also stated that the government would support powering the Atamasthana and the Jaya Sri Maha Bodhi premises.

During his visit to the Anuradhapura shrine, the President met with the Chief Incumbent of the Atamasthana in Anuradhapura and Chief Sanghanayake Thera of Nuwara Kalaviya Most Ven. Dr. Pallegama Hemarathana Nayake Thera and engaged in a brief discussion. After paying obeisance to the historic Jaya Sri Maha Bodhi and receiving blessings, he participated in the commissioning of the  solar power system.

Additionally, President Wickremesinghe interacted with the public gathered at the Anuradhapura sacred grounds, engaging in friendly conversations and gathering their input.

In a significant move towards the government’s national policy of reducing carbon emissions and achieving a zero-emission target, LTL Holdings has dedicated a 150-kilowatt solar power system to Jaya Sri Maha Bodhi. This marks the first phase of its net zero carbon emission plan.

This solar power system meets the entire power requirement of the Sri Maha Bodhiya precinct, making the premises of Jaya Sri Maha Bodhi a net zero carbon emission zone for the first time in history.

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Dispute over cobalt-rich seabed: FSP alleges India exploiting hapless Lanka

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Pubudu Jagoda

… Indian HC denies dispute

By Shamindra Ferdinando

Top spokesperson for Jana Aragala Sandhanaya, Pubudu Jagoda, yesterday (12) said that India was brazenly exploiting the continuing political and economic crisis here to secure rights to explore a cobalt-rich underwater mountain in the Indian Ocean, situated in an area staked by Sri Lanka in terms of Article 76 of the United Nations Convention on the Law of the Sea (UNCLOS).

Jagoda, who also represents the Peratugaami Pakshaya (Frontline Socialist Party), a breakaway faction of the JVP, said so when The Island sought further clarification after he discussed the developing situation with India, in an interview with Asoka Dias on Sirasa ‘Pathikada.’ telecast earlier in the day.

Jagoda told The Island that the unprecedented Indian move on Afanasy Nikitin seamount that lies entirely within an area, also claimed by Sri Lanka way back in 2009 as being within the boundaries of its continental shelf, should be a warning to both the government and the Opposition.

The former JVPer declared that Jana Aragala Sandhanaya would take up this issue vigorously in the run-up to the forthcoming presidential election. Jagoda emphasized that India took advantage of hapless Sri Lanka while frequently uttering like a mantra its self-proclaimed Neighbourhood First Policy and Security and Growth for All in the Region (SAGAR). The Peratagaamis-led grouping recently pledged to contest both the Presidential and Parliamentary polls.

While asserting that political parties represented in Parliament, along with the government, lacked the courage to take up this issue with India, Jagoda therefore urged the Wickremesinghe-Rajapaksa government to deal with it diplomatically at the highest level.

The Indian High Commission spokesperson said there was no dispute and asked The Island to refer to a statement dated July 08, 2024 issued by Sri Lanka Ministry of Foreign Affairs.

Appearing on ‘Pathikada’, Jagoda questioned the failure on the part of the government to respond to the Indian move much earlier.

Pointing out that India sought the intervention of Kingston Jamaica-based International Seabed Authority (ISA) to secure approval for exploration of cobalt-rich ferromanganese crusts located at the Afanasy Nikitin seamount thereby undermined Sri Lanka’s efforts to win recognition of the outer limits of its continental shelf, Jagoda said that India seemed to be resorting once again to bullying tactics.

War-winning President Mahinda Rajapaksa, who always jealously guarded the country’s interests, made Sri Lanka’s claim on May 08, 2009, as ground forces were engaged in the last phase of operations on the Vanni east front. The war was brought to a successful conclusion 10 days later.

Jagoda explained how India unfairly pressured Sri Lanka over Chinese research ship visits, finally leading to the government to declare a ban on such stays during whole of this year. The FSP spokesman also expressed concerns over the Katchatheevu issue, massive Indian poaching and the recent death of a Special Boat Squadron (SBS) member as a result of aggressive maneuvers resorted to by an intercepted trawler off Kankesanthurai.

Jagoda alleged that poaching on such a scale couldn’t take place without India’s tacit approval. “They have a much bigger Navy and significant Coast Guard assets therefore there cannot be any excuse for not being able to effectively hinder crossing of the Indo-Lanka maritime boundary at will by their poachers,” Jagoda said. Declaring that destructive bottom trawling had been banned in Indian waters though the invading Indian fishing fleet freely adopted the highly harmful method in our waters, Jagoda alleged that New Delhi conveniently turned a blind eye to what was going on in the neighbour’s waters.

Referring to the dispute over the Indian claim contrary to that of Sri Lanka, the FSPer said the Indian media coverage of the issue indicated that they intended to go ahead with the exploration of the cobalt rich region. Reference was made to India reaching agreement with Taiwan to undertake the exploration amidst rising tensions between China and India.

Acknowledging that the two issues – Sri Lanka’s submission made in terms of UNCLOS in 2009 and India’s appeal to ISA this year – were before the UN as declared by Sri Lanka Foreign Ministry, Jagoda said that the government should discuss the contentious matters with India without further delay.

Jagoda said that no political party represented in Parliament so far commented on the developing situation.

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Another FR petition to stay Presidential Poll at 11th hour

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Another fundamental rights petition was filed in the Supreme Court yesterday (12), requesting the court to prevent the Election Commission from declaring the next presidential election.The petitioner, a lawyer by profession, has argued that the 19th Amendment to the Constitution, which reduced the President’s tenure to five years from six, was not passed properly.

He has argued that the 19A must be approved by the people at a referendum and holding a presidential election, as per the aforementioned amendment, is a violation of the Constitution.

The members of the Elections Commission, the Secretary General of the Parliament and the AG were named as respondents.

The petition says that the 19th Amendment strips the President of the power to dissolve Parliament a year after it was elected. The Supreme Court at that time said the provision had to be approved by the people at a referendum for it to become law. A referendum was never held, and therefore 19A could not be considered law.

The petitioner has said the Elections Commission is planning to hold a presidential election this year based on 19A and that it is unconstitutional to hold the election until 19A is subjected to a referendum.

The petitioner has asked the Supreme Court to declare the holding a presidential election, five years into the term of the President, unconstitutional. He also urged the court to instruct the Secretary General of Parliament to subject 19A to a referendum.

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