Midweek Review
Growing foreign dependency and India’s USD 4 bn lifeline
By Shamindra Ferdinando
The Japanese embassy and UNICEF (United Nations Children’s Fund, previously known as United Nations International Children’s Emergency Fund), on 16 March, 2023, issued a joint statement that dealt with the impact the developing political-economic-social crisis is having on the poor in Sri Lanka.
The statement focused on the suffering of the children and measures taken by UNICEF, in consultation with the Governments of Japan and Sri Lanka, to provide relief to the needy.
However, what really captured public attention was the declaration made by the Japanese Ambassador, in Colombo, Mizukoshi Hideak, that with the latest contribution, amounting to USD 1.8 mn, the total Japanese financial assistance, provided through UNICEF alone, exceeded USD 3.8 mn, since the beginning of last year. That is definitely a significant package provided through a single UN agency, particularly against the backdrop of the unceremonious cancellation of the Japan- funded Light Rail Transit (LRT) project, in late Sept., 2020, by the Gotabaya Rajapaksa Government.
The directive, in this regard, was issued on 21 Sept., 2020, by Dr. P. B. Jayasundera, in his capacity as Secretary to the President, to the then Transport Secretary, Monti Ranatunga. That move ruined Sri Lanka’s relations with Japan.
Whoever advised the then President Gotabaya Rajapaksa to terminate the project, without consulting Japan, as head of the Cabinet-of-Ministers, he couldn’t absolve himself of the responsibility for the ruination of vital relationship with Tokyo. Had it not been the case, Japan, most probably, would have delivered a substantial assistance to Sri Lanka, at the onset of the ongoing unprecedented crisis.
Sri Lanka made a failed bid to secure as much as USD 3.5 bn loan from Japan, during the tenure of Sanjiv Gunasekara as Sri Lanka’s Ambassador in Tokyo. Gunasekara, a close associate of President Gotabaya Rajapaksa, resigned in the wake of the 09 May, 2022, violence, that gave a turbo boost to the campaign against his government.
Unlike Japan, India provided direct aid in various forms to Sri Lanka, struggling to cope up with what became an insurmountable crisis to overcome on our own. India has repeatedly declared that the continuing assistance is in line with Premier Narendra Modi’s much touted ‘Neighbourhood First’ policy. Sri Lanka received concessional credit facility, amounting to USD 1 bn, in March last year. In addition to that, by the second week of March this year, Sri Lanka received other lines of credit, worth over USD 3 bn. Therefore, the total Indian assistance is worth over USD 4 bn, a staggering amount as Sri Lanka’s debt before the Japanese and Indian interventions stood at over USD 53 bn. Indian intervention cannot be compared, under any circumstances, with assistance provided by any other country.
The Indian assistance is of immense importance as the International Monetary Fund (IMF), after much deliberation, promised USD 2.9 bn over a period of four years. The delay on the part of China to provide an assurance as regards debt-restructuring support, hindered the finalization of the tripartite agreement involving Sri Lanka, creditors and IMF. Finally, China gave that assurance, in writing, early this month.

Indrajit Coomaraswamy
The situation was so precarious, Sri Lanka couldn’t have even provided the free text books that have been given, annually, to the student population ,from the time of the JRJ regime. Those who had been at the helm of political power, over the past three decades, to varying degrees, ruined the economy, and, by 2021/2022, Sri Lanka was unable to provide even the basic requirements, like cooking gas, kerosene, petrol, etc., as even remittances from our expatriate workers, which in the past amounted to about seven billion dollars per year, dropped drastically due to the illegal underground banking system, hawala/undiyal, hijacking much of it from the normal banks. The government didn’t have the means to provide school text books for the 2023 academic year. In consultation with India, of the USD 1 bn concessional credit facility, over USD 10 mn was utilized by the State Printing Corporation, and private importers, to procure printing paper and other material from India. India met 45% (four mn students) of the total requirement. Indian High Commissioner Gopal Baglay visited the SPC, on 09 March, 2023, to dispatch a consignment of textbooks to schools. Education Minister Dr. Susil Premjayantha joined Baglay. The Indian High Commission statement, issued two days later,, was aptly titled ‘India’s support for text books investment in Sri Lanka’s future.’
The government and the Opposition should be ashamed of their failure to provide for the children’s need.
Perhaps, a Parliamentary Select Committee (PSC) should be appointed to examine the circumstances leading to Sri Lanka’s bankruptcy status. Decades of utterly irresponsible management of the economy, coupled with an explosive mixture of causes – waste, corruption and irregularities – caused the current crisis.
Political parties, represented in Parliament, are responsible for the continuing crisis, to varying degrees.
Controversy over ISBs
The Island discussed some of the issues at hand in last week’s midweek piece, headlined ‘All praise for Lanka’s saviours!
What Dr. Coomaraswamy didn’t say was that as the CB Governor, he was also directly responsible for the Yahapalana government borrowing a record USD 12.5 bn from the international bond market, at high interest rates, from private lenders, primarily in the West. So what did that government achieve with such huge borrowings? All that the Yahapalana regime achieved, with all that money, we cannot see, except to lay the foundation for the current debt crisis?
Our comment on the basis of recent claims that the Governor of the Central Bank, Dr. Coomaraswamy (2016-2019), only told one side of the truth, attracted responses from several parties, including the Central Bank.
Consequently, the writer discussed the borrowing of USD 12.5 bn, and related matters, and was told the following: First, it is important to point out that the Governor, Central Bank, has no authority to approve or undertake any borrowing on behalf of the government. The borrowing limit, in any given year, is set by Parliament. Therefore, the government cannot borrow beyond the limit set by Parliament. In addition, all external borrowing has to be approved by the Finance Minister, and the Cabinet of Ministers. The Governor and the CBSL only have an advisory role. On ISBs, they have marketing and issuance as additional responsibilities once the Cabinet approved the transaction.
It is also important to recognize that ISBs are only one channel for external commercial borrowings. Others include short-term SWAPs, foreign term loans/syndicated loans and external flows into government rupee securities. The article dealt with only one instrument, having ignored the switching that was undertaken during 2015-19 to increase the maturity and reduce the cost of foreign borrowing.
As regards the USD 10 bn increase in ISBs outstanding during 2015-19, USD 5 bn of this increase can be attributed to switching away from shorter term (one year or less) and more expensive SWAPs and highly volatile foreign portfolio investment (hot money) in Government rupee securities to longer term (5 and 10 years) and less costly ISBs. SWAPs were reduced from approximately USD 2.5 bn to USD 500 mn.
Volatile and foreign investment in government rupee securities was reduced from USD 3.5 bn to USD 600 mn. In addition, during the course of 2019, a second ISB of USD 2 bn was issued to create a stronger buffer of external reserves to address the inevitable increase in uncertainty going into elections due shortly thereafter. (The money required for 2019 had been raised through an ISB, issued in March 2019.)
So about USD 7 bn of the USD 10 bn increase in the stock of ISBs outstanding, during 2015-19 may be attributed to increasing the stability and reducing the cost of the ISBs outstanding by switching instruments and raising the buffer provided by external reserves prior to a period of uncertainty, associated with elections.
The remaining increase of USD 3 bn may be partly attributed to the fact that borrowing incurred earlier had not resulted in a sufficient increase and/or saving of foreign exchange. Hence money had to be borrowed to repay debt incurred earlier. In fact, Verite Research found that 89 percent of external debt, repaid during 2015-19, could be accounted for by liabilities incurred prior to 2015.
The adverse debt dynamics were recognized and the Medium Term Debt Management Strategy was published in April 2019 to chart the way to sustainability. In addition, the Active Liability Management Act (2018) was introduced to expand the tools available to the CBSL for managing external debt sustainably. The CBSL, as the economic adviser to the Government, also advocated that there should be a primary surplus in the budget and that non-debt creating inflows (such as exports, remittances, tourism proceeds, FDI, inflows into the CSE and government securities) should be increased to enhance the capacity to service debt while supporting the level of imports necessary to achieve the growth potential of the economy.
They also pointed out that only one of the ISBs, issued during 2015-19, has been settled to date. This amounted to USD 500mn. They expressed the view that it is not possible to sustain the argument that servicing ISBs, incurred during 2015-19 ,led to the standstill in debt repayments in April 2023.
Treasury bond scams and tax cuts

The US embassy released this picture of
Ambassador Chung at an event in
Colombo where the second shipment of
36,000 metric tons of Triple Super
Phosphate (TSP) was handed over to Sri
Lanka. It brings the total of USAID-supported
TSP and urea fertiliser to more than
45,000MT, over the last year.
Sweeping tax concessions to the rich and reduction of VAT, that had been introduced by President Gotabaya Rajapaksa’s government to encourage business in 2019/2020, escalated the financial crisis, leading to the declaration of the state of bankruptcy, two years later. No one in the Gotabaya Rajapaksa’s cabinet dared to challenge such far reaching tax concessions and VAT reduction.
How the loss of as much as Rs 600 bn in revenue, as alleged by the Opposition ,due to tax concessions and reduction of VAT, contributed to the current crisis, should be examined, also taking into consideration (1) Treasury bond scams perpetrated in Feb, 2015 and March 2016 at a time the CBSL has been under the then Prime Minister Ranil Wickremesinghe, in his capacity as Minister of Policy Planning and Economic Affairs (2) Enactment of new Foreign Exchange Act in 2017 in the wake of Treasury bond scams. Critics say the repealing of time-tested exchange control law that has been in place for decades paved the way for exporters to ‘park’ export proceeds overseas. Of the 225 MPs, 94 voted for the new law whereas 18 voted against. In spite of Justice Minister, Dr. Wijeyadasa Rajapakse, PC, taking up this issue, both in and outside Parliament, remedial measures hasn’t been taken, to date. The Finance Ministry owed an explanation as to how it intended to compel the exporters to bring back export proceeds (3) Continuing public-private sector partnership in corrupt practices, particularly mis-invoicing (under invoicing and over invoicing of imports/exports) (4) Pivithuru Hela Urumaya leader Udaya Gammanpila, MP, has moved the Supreme Court against the Central Bank Bill. The Attorney-at-Law alleged that the new law violated Article 3 and 4 of the Constitution hence needing the approval of the people at a referendum. In addition to Gammanpila, Dr. Gunadasa Amarasekera and Jathika Nidahas Peramuna leader Wimal Weerawansa, too, moved the Supreme Court in terms of the Article 121 against the Bill titled ‘Central Bank of Sri Lanka.’ Former JVP MP Wasantha Samarasinghe, on behalf of the Jathika Jana Balavegaya (JJB), too, moved the Supreme Court in this regard.
A warning from Hanke
The country is in a bind. In spite of the execution of the agreement with the IMF later this month, the situation remains dicey. The absence of economic recovery plan continues to cause further instability.
Therefore, the government and the Opposition should seek a consensus on a national action plan, even if Local Government polls cannot be conducted in late April, regardless of the Supreme Court intervention.
Steve Hanke, Professor of Applied Economics, at Johns Hopkins University, in the USA, recently issued a dire warning to Sri Lanka. Appearing on CNBC’s ‘Squawk Box Asia,’ Prof. Hanke declared Sri Lanka needs institutional reforms in order to achieve long-term debt sustainability.
Referring to Sri Lanka and what was described as emerging markets (Argentina and Montenegro), where he played a key role in establishing new currency regime, former economic advisor to US President Ronald Reagan warned “Unless you change the institutions and the rules of the game, governing these countries, they’re always going to remain in the same … situation that they’ve been in for a long time.”
Prof. Hanke added: “In fact, most of the personalities, involved in Sri Lanka ,at the high level, are exactly the same as they’ve been for years. So nothing has changed.”
In other words, those who have ruined Sri Lanka are spearheading the economic recovery process. The American is spot on. Sri Lanka is in a pathetic situation. Those who had systematically brought Sri Lanka to its knees, by pursuing ill-fated policies, emerged as its saviours. That is the bitter truth. The role of the executive, legislature, and judiciary, needs to be examined. Those who have moved the Supreme Court against the Bill, titled ‘Central Bank of Sri Lanka,’ have quite conveniently forgotten how the Yahapalana government, and Central Bank, twice perpetrated Treasury bond scams. What would have Prof. Hanke said if CNBC raised Treasury bonds scams during ‘Squawk Box Asia.’
If not for Deepa Seneviratne, the then head of Public Debt Department, Governor Arjuna Mahendran’s role couldn’t have been proved. Former Auditor General Gamini Wijesinghe said so at an event organized by the Colombo Municipal Council years ago.
Sri Lanka cannot forget Prof. Hanke’s remark in the CNBC programme. “You have to remember that we have a country that since 1965 has had 16 IMF programmes and they’ve all failed. You get temporary relief in anticipation of a bailout. But in the long run … none of these IMF programmes work.”
It would be pertinent to briefly examine how interested parties brazenly protected perpetrators of the Treasury bond scams.
Having named Mahendran as the Governor, regardless of the opposition from President Maithripala Sirisena, those planning to commit the first daylight robbery of the Central Bank moved Deepa Seneviratne to the Public Debt Department as its head, in spite of her not having had any previous experience in the particular division. It seems they had obviously felt comfortable in having a lady officer there they thought they could manipulate her to suit their need. But Seneviratne turned tables on the bond thieves by putting up a note to register her strong opposition to Mahendran’s move. She should have been rewarded for her fearless stand with at least a national honour if not an international one, even from bodies like the UN, the Transparency International, Amnesty International, etc. But it seems that even these international busy bodies have their own political angles.
It would be of pivotal importance to keep in mind that President Sirisena appointed a Commission of Inquiry (CoI) in January 2017, about 10 months after the second robbery, and two years after the first.
The Commission comprised Justice K.T. Chitrasiri, the late Justice P S Jayawardena and retired Deputy Auditor General V. Kandasamy. Sumathipala Udugamsuriya functioned as its Secretary. CoI issued a devastating report that implicated Perpetual Treasuries Limited (PTL) in the Treasury bond scams.
President Sirisena went to the extent of dissolving Parliament, in June 2015, to prevent the Committee on Public Enterprises (COPE) tabling its report on the first bond scam. SLFP leader Sirisena owes an explanation. Justice Chitrasiri’s CoI didn’t inquire into that aspect. Sri Lanka’s response to waste, corruption, irregularities and mismanagement is baffling. Let me end this piece reminding how the Bar Association of Sri Lanka (BASL) secured a substantial sponsorship from Perpetual Treasuries Limited (PTL) deeply mired in a bond scam, in 2016, for the Law Asia Conference during the tenure of its then President Geoffrey Alagaratnam, PC. The BASL never explained why it obtained PTL sponsorship even after the exposure of Treasury bond scams. That partnership also escaped the CoI. The rest is history.
Knowing what is now happening to the US economy with a string of bank failures and unprecedented bailouts, especially due to hoodoo economics it introduced in recent decades, like repeated quantitative easing (blindly printing trillions of dollars leading many to say the dollar is now only good as toilet paper) that has been practiced to ensure its world hegemony, the whole world might be hit with bank failures and even by a depression worse than the one that befell with the stock market crash of 1929. Already the contagion has spread to Europe with some leading banks there also requiring help.
Washington’s debt now stands at USD 31 trillion and climbing, but our own debt burden is still under USD 55 billion. So if we can get our exporters, who have stashed export earnings abroad, to bring them back, the picture here will not be as scary as it is made out to be. Even Minister Wijeyadasa Rajapakse has said that our export proceeds that have been parked overseas is in the region of USD 55 billion.
Soonwe will start receiving the IMF bailout, but our economic whiz kids have not done anything to plug the massive foreign exchange leak that has been freely draining foreign currency from the country, since the nineties, by way of private foreign exchange dealers who have been allowed to sell foreign exchange to any Tom, Dick and Harry, including drug dealers, to take their sales proceeds out of the country!
We would also like to ask the relevant authorities what they have done to recover monies stashed abroad by Lankans illegally that were exposed in great detail by the likes of Panama Papers and Pandora Papers.
Midweek Review
Thileepan’s fast unto death: An authentic narrative that many missed
Tamil political parties and politicians are seeking political advantage over the death of Thileepan. Last year, organisers of Thileepan commemoration prevented Fisheries, Aquatic and Ocean Resources Minister Ramalingham Chandrasekaran from entering the Thileepan memorial in Nallur. In spite of being a Minister, Chandrasekaran couldn’t enter the premises. The NPP National List lawmaker made the abortive bid on 17 Sept., 2025, the third day of the 12-day commemoration.
Would he risk being snubbed for a second consecutive year? At the time the Thilipeen commemoration started, on 15 Sept., Chandrasekeran had been away in China and he returned to the country over the weekend.
By Shamindra Ferdinando
Commemorative events held at the newly installed bronze statue of the late Rasiah Parthipan, alias ‘Lt. Colonel’ Thileepan at Nallur, Jaffna, caused controversy. A section of the Opposition accused the NPP government of encouraging separatist movement by turning a blind eye to the growing hero worship of an LTTEer.
The unveiling of the statue took place on 15 Sept., the day the Tiger launched his fast unto death, in 1987, to become a hero in the eyes of his equally misled community. At the time of his death, at the Nallur Hindu Temple, on 26 Sept.,1987, Thileepan was 23-years-old.
The controversial commemoration will continue till 26 September, 2026. The SLPP led the attack against the backdrop of accusations that the former ruling party promoted the LTTE ideology, by accommodating maverick Jaffna District Independent lawmaker Dr. Ramanathan Archchuna, a truly qualified medical doctor on its political platform. Dr. Archchuna also never shies away from calling a spade a spade, irrespective of any consequences.
Almost four decades after his death, controversy still surrounds the circumstances leading to the former Jaffna Hindu College student, and Jaffna University undergraduate, launching the fast unto death.
Jaffna Monitor, in a story headlined ‘Jaffna Begins 39th Commemoration of Thileepan’s Fast,’ posted this month, dealt with Thileepan’s fast. Let me reproduce the relevant section: “His fast followed the Indo-Lanka Accord of July 1987, under which Indian troops were deployed to the north as a peacekeeping force. On Sept. 13, 1987, the LTTE handed the Indian High Commission a letter setting out five demands: the release of Tamils held under the Prevention of Terrorism Act and emergency regulations; an end to Sinhalese settlement in Tamil areas carried out in the name of rehabilitation; a halt to all such rehabilitation work until an interim administrative council is established; an end to the construction of police stations in the Northern and Eastern Provinces; and the disarming of government-armed home guards, together with the withdrawal of the army and police from schools. The demands were addressed to New Delhi on the reasoning that India alone could compel Colombo to act. No reply came.” https://www.jaffnamonitor.com/featured/jaffna-begins-39th-commemoration-of-thileepans-fast/
But, ex-LTTE combatant Niromi de Soyza (not her real name) in her internationally acclaimed ‘Tamil Tigress’ disclosed what transpired at a meeting (p 142) chaired by Thileepan himself at a place called Freedom Birds’ head office where he declared the LTTE’s determination to force the Indian Army to leave Sri Lanka. Declaring that those who served the group’s political wing didn’t get an opportunity to show their commitment to the organisation, he had vowed to go ahead with fast unto deaths, regardless of the consequences. Soyza, who had been assigned to the group responsible for crowd control at the fast unto death site, quoted Thileepan as having said at the previously mentioned meeting: “This is my chance. I’m optimistic it will achieve something, whether I live or die. We must force the Indians out of our land.”
The author of “Tamil Tigress’ who had been among those who received her first assault rifle and cyanide capsule from Thileepan questioned the (Chapter 9: There’s still time to change your mind) as to why Velupillai Prabhakaran chose physically fragile Thileepan to undertake the fast unto death.
According to Soyza’s narrative, the fast unto death had been directed at the Indian Army. Referring to the Nallur hunger strike 39 years ago, Soyza said that lyrics of all songs played therein expressed the same sentiments. In her own words, Thilpeepan’s dying wish was to see the foreign army, the IPKF (Indian Peace Keeping Force) defeated.
Sri Lanka never really examined at least key events that shaped the war in the North-East. Successive governments lacked political will to meticulously scrutinise events thereby setting the record straight. Over the years various interested parties have been successful in promoting false narratives, pertaining to key events. Thileepan’s fast unto death is a case in point.
A memorial for IPKF

IPKF memorial
Thileepan’s fast unto death, or slow suicide, created the background for the LTTE-IPKF war. The war erupted just two weeks after Thileepan’s death. Those propagating false narratives have conveniently forgotten that the crux of the matter is the fact that the LTTE didn’t hand over its weapons as envisaged in the Peace Accord signed on 29 July 1987. All Tamil terrorist groups were to be disarmed within 72 hours after the signing of the accord. India failed in one of its primary responsibilities.
The much publicised weapons handover that took place in Jaffna was a farce. Perhaps, the top IPKF command knew of the LTTE strategy but chose to turn a blind eye. The consequences were devastating. The memorial put up by Sri Lanka, in 2008, for the IPKF, at Battaramulla, is a stark reminder of the war caused by the LTTE. Had it accepted the Indo-Lanka Peace Accord, as previously agreed, there wouldn’t have been the fast unto death undertaken by Thileepan and a bronze statue or a memorial for the IPKF.
The LTTE had been hell-bent on eradicating other Indian-sponsored former Tamil terrorist groups, as well as taking on the Indian Army. Prabhakaran had been so over confident of his group’s military prowess, he created an extremely hostile environment conducive for war. Having deceived the governments of India and Sri Lanka regarding the surrendering of armaments in line with the peace accord, Prabhakaran, apparently engineered Thileepan’s slow suicide. ‘Tamil Tigress’ author who personally knew Prabhakaran and Thileepan emphasised that point quite clearly. The bottom line is that Thileepan’s demise had been a tool in Prabhakaran’s hands who brazenly manipulated the Jaffna community. Prabhakaran used Thileepan’s needless agonising death to maximise the overall LTTE strategy. The LTTE wanted an excuse to resume hostilities. Obviously, he was quite successful in creating an environment conducive for war. Don’t forget that Thileepan launched his fast unto death six weeks after the deployment of the Indian Army in Northern and Eastern Sri Lanka.
The surrender of arms, arranged at Suthumalai sportsground on 4 August, 1987, with the presence of the media, was meant to underscore the end of the conflict. But the ‘Tamil Tigress’ author, who had been present at the arms surrender, revealed in her memoirs how Prabhakaran expressed suspicion of the peace accord. According to her, on the night of 4 August, 1987, she was among those addressed by Prabhakaran, his first interaction with LTTE cadres following his Suthumalai sham weapons surrender to fool the fools. Soyza quoted Prabhakaran as having told them: “All our good ammunition was stashed prior to the surrender. We’ll continue to hand over the rest.” She also quoted Prabhakaran as having declared: “War will resume in a month or two.”
Close on the heels of a group of LTTE cadres taking their lives after being apprehended by the Navy in the first week of Oct., 1987, the author of ‘Tamil Tigress’ quoted Prabhakaran as having alleged India engineered the peace process as a plot to gradually eliminate them. The LTTE leader had obviously forgotten if not for India they wouldn’t have achieved powerful military status. India not only armed the Tamil terrorists, but also granted them freedom to conduct operations across the Palk Strait. The Indian Navy looked the other way when terrorists, wounded in combat with the Sri Lankan military, were moved across the short passage to receive treatment in Tamil Nadu hospitals.
The suicide of LTTE cadres, including the then Jaffna commander ‘Lt. Col.’ Kumarappa, and Trincomalee commander ‘Lt. Col’ Pulendran, boosted Prabhakaran’s strategy. Those propagating false narratives tend to forget that Prabhakaran smuggled in cyanide capsules into Palaly air base where the 17 personnel were held. In a way, the slow death of Thileepan, and mass suicide of LTTE cadres, all were engineered by Prabhakaran himself. Those demanding accountability on the part of Sri Lanka never bothered to examine Prabhakaran’s murderous plots.
Sri Lanka’s dilemma

Sri Lanka memorial
Indian Defence Minister Rajnath Singh, during his recent visit here, paid a floral tribute to the IPKF memorial, at Pelawatte, Battaramulla. It would be pertinent to mention that the construction of the memorial was completed in 2008. The late General Lionel Balagalle, in his capacity as the Commander of the Army and Chief of Defence Staff, proposed a memorial for IPKF, following a visit to New Delhi in Dec., 2003. What made Balagalle propose a memorial for the IPKF, knowing very well India destabilised Sri Lanka and the introduction of the foreign Army by way of arm twisting the then government, headed by JRJ, was not appreciated, under any circumstances. He, like many of us, however realised we had to make peace with our giant overbearing neighbour, irrespective of whether we liked it or not, in order to co-exist.
The destabilisation of a friendly country had been in line with their overall strategy to deploy its Army to ensure the installation of an administration loyal to New Delhi. India went to the extent of forming a force called Tamil National Army (TNA) during the period leading to the withdrawal of the IPKF in March 1990. Having joined The Island editorial as a novice, in June 1987, the writer had the opportunity to cover the last Indian troop carrying vessel leaving Trincomalee port on the afternoon of 24 March, 1990 (The IPKF is off, The Sunday Island, 25 March, 1990). India violated Sri Lanka airspace on 4 June to air drop 25 tonnes of food and medicine over Jaffna peninsula without anyone’s permission here, which came to be sarcastically termed the ‘parippu drop’, just three days after I joined The Island.
While honouring the IPK with a memorial in which 1069 names of its officers and men killed in the Lankan misadventure inscribed, since the end of the war, in May 2009, Sri Lanka played politics with the defeated LTTE. The Thileepan’s statue is a case in point. The installation of a new bronze statue of Thileepan, who died in a fast unto death against India demanding the withdrawal of the IPKF, soon after the Indian Defence Minister paid floral tribute to the IPKF memorial, highlighted Sri Lanka’s continuing dilemma.
The ruling NPP under any circumstances cannot risk antagonising the Tamil electorate, or the Tamils living overseas, by clamping down on events, such as the Thileepan commemoration. Having won all electoral districts in the predominantly Tamil speaking Northern and Eastern Provinces at the presidential and parliamentary polls, in 2024, and done well at the Local Government polls of May 2025, in the same regions, the NPP may have bent backwards to avoid confronting organisers of such events.
The intervention made by police at Nallur, on 18 Sept., 2026 .should be considered as a measure to counter accusations that the government promoted separatist sentiments. Police disrupted the public address system claiming that the organisers didn’t obtain permission to use speakers. But, the commemorations continued not only in Nallur but in Batticaloa as well.
The undeniable truth is all political parties, represented in Parliament, played ball with the LTTE, during the conflict and after, hence the song and dance will continue. The reality is Prabhakaran staged Thileepan’s slow death and engineered mass suicide at the Palaly air base in Sept. and Oct. 1987 to plunge the country back into war. Therefore, the country should be wary of those propagating and promoting false narratives in support of their despicable political agendas. The issue is whether Thileepan willingly sacrificed his life to help Prabhakaran implement his strategy or was used as a tool. If Soyza’s narrative is accurate Thileepan had been chosen from among a large group of volunteers who accepted the challenge. There is no doubt fast unto death must have been Prabhakaran’s brainchild as much as the Palaly mass suicide was. What made Prabhakaran believe that he could overwhelm the Indian Army, at that time numbering over 1.1 mn and was considered the fourth largest with the Soviet Union, China and the US maintaining far bigger land forces?
During the Indian Army deployment that began in July/August, 1987, the strength was around 10,000 officers and men. Their mission was to ensure implementation of the ceasefire and disarming of terrorist groups. But, when Prabhakaran executed a group of Sri Lankan soldiers in their custody following the mass suicide at Palaly airbase on Oct. 5, 1987, and fighting erupted a week later, India had no option but to bring in additional forces. At the peak of their deployment here the total strength including the Navy and Air Force units, reached 100,000.
Thileepan insulted
It is a paradox that a section of the Tamil community commemorated Thileepan after having voted for warwinning Army Commander General (retd.) Sarath Fonseka at the 2010 presidential election. In spite of Fonseka suffering a humiliating defeat, he won all predominantly Tamil speaking districts. Tamils, including recipients of foreign citizenship, annually commemorate various LTTE events. ‘Black Tiger Day’ on 5 July, the day Vallipuram Vasanthan, known by the nom de guerre Captain Miller, mounted a suicide attack on troops of ‘Operation Liberation,’ based at the Nelliady Central College, is one such event. That was the time between the infamous Indian airdrop and the signing of the so-called Indo-Lanka peace accord that was done under the threat of direct Indian military intervention.
What made the community that still considered Thileepan as a hero to vote for Fonseka who mercilessly brought the war to an end? What made lawmaker Archchuna, who still venerated Prabhakaran, to join Mahinda Rajapaksa on the SLPP platform? Thileepan would have turned in his grave if he saw how the community behaved. Nothing could have offended him or Prabhakaran than the Illankai Thamil Arasu Kadchi (ITAK)-led Tamil National Alliance (TNA) joining hands with the UNP and the JVP to field Fonseka as the common candidate at the 2010 presidential election.
The TNA consisted of former Indian funded terrorist groups TELO, PLOTE and EPRLF, in addition to the ITAK, had no qualms in promoting Fonseka’s candidature after having accused his Army of gross human rights violations. The Tamil electorate had no qualms in choosing Fonseka over Mahinda Rajapaksa, who sought political consensus with the LTTE as a last bid to end bloodshed before unleashing the armed forces on an all-out assault, within our limited means, to defeat uncompromising Tiger terrorists.
Sri Lanka pathetically failed to set the record straight. The worst offender is President Rajapaksa himself. His administration could have done much more to explain the developments leading to all-out war. Instead, the first post-war Rajapaksa government squandered that opportunity. Its pathetic failure helped those who couldn’t stomach the LTTE’s defeat to propagate war crimes accusations with the help of the conniving West, which, unfortunately, included the United Nations organs like the UNHRC, controlled by them.
While the top Sri Lankan military and political leaderships were held accountable for unsubstantiated war crimes allegations, with the US, the UK and Canada declaring targeted sanctions against former Presidents Mahinda Rajapaksa and Gotabaya Rajapaksa as well as Admiral of the Fleet Wasantha Karannagoda, General Shavendra Silva et al. Australia found fault with strategist Maj. Gen. Chagie Gallage for taking command, post-war command, of 59 Division that played a significant role in eradicating the LTTE. Gallage was denied a visa during the Yahapalana administration. When this writer raised the relentless Western attacks on wartime Sri Lankan leadership at a media briefing called by the Foreign Ministry in Sept., 2022, the then Foreign Minister Ali Sabry, PC, said that entire divisions deployed on the northern front had been blacklisted.
While Indian dignitaries paying their respects at the IPKF memorial seemed to have received public acceptance, last year the NPP government created unprecedented controversy ahead of the May 2025 commemoration when the Defence Ministry announced President Anura Kumara Dissanayake wouldn’t attend the 16th ‘War Heroes’ commemoration ceremony. The declaration triggered a massive political backlash. President Dissanayake was compelled to reverse his decision. The JVP and NPP leader, who also holds the Defence portfolio and the post of Commander-in-Chief of the armed forces, attended the event. This year there was no controversy. Whatever the JVP/NPP political stand, the President cannot, under any circumstances, shun the annual war heroes’ commemoration.
The armed forces eradicated JVP terrorism twice in 1971 and 1986/87 to 1990. They defeated the conventional military and terrorist challenge posed by the LTTE. Whatever the ungrateful opportunists and Western-funded NGO hacks write, the armed forces triumph over the LTTE is the single most important post-independence achievement. The eradication of the JVP challenge that almost overwhelmed the UNP government in the late 80s, too, is equally important and had the armed forces failed at the time, the country could have ended up in far worse chaos. The bottom line is that the eradication of the LTTE couldn’t have been achieved if the UNP didn’t triumph over the second JVP-inspired terror campaign. That is the undeniable truth. It would be unfair by the JVP if we didn’t mention that the UNP too drove the JVP to take up arms in the 80s by proscribing the party over the 1983 anti-Tamil violence, though it was not responsible for the breakdown of law and order, countrywide, when UNP goons went on the rampage against innocent Tamils, especially in Colombo. The postponement of scheduled parliamentary elections by six years to 1989, after holding a sham referendum by the JRJ government, too, contributed to the war in the North, and terrorism in the South.
Midweek Review
Illusion of recovery: Three fault lines threatening Sri Lanka’s future
By Chandre Dharmawardana
chandre.dharma@yahoo.ca)
(Continued from 22 Sept. 2026)
Other well-recognised fault lines
In discussing Sri Lanka’s political trajectory since 1948, many writers relish a narrative where its current impasse and its ethnic conflict are traced back to the “curse of partisan politics” (e.g., This curse of partisan politics in Sri Lanka, Island 2026/09/4, by Brig. Ranjan de Silva [10]). A more sophisticated narrative is based on the negative impact of Sinhala Only nationalist policies introduced by SWRD Bandaranaike after defeating the pro-business UNP in 1956. In fact, many social scientists (e.g., H. L. Seneviratne [11]) have analysed Sri Lanka’s post-Independence trajectory in dystopian terms within this paradigm equated to the negative impact of a majoritarian “Sinhala-Buddhist-dominance” politics.
H. L. Seneviratne explicitly positions the 1956 election of S. W. R. D. Bandaranaike and the subsequent “Sinhala Only” Act as the foundational missteps that set Sri Lanka on a tragic path. He argues that this political turn institutionalised majoritarian chauvinism to secure electoral victories. Seneviratne analyses the post-1956 era in stark, structural terms. He argues that by allowing Buddhist monks (the Sangha) to morph from spiritual renunciates into a highly politicised, corporate pressure group, the state birthed a toxic political culture. In his evaluation, this “New Buddhism” fostered ethnic polarisation, institutionalised corruption, and ultimately laid the structural groundwork for the devastating Sri Lankan Civil War.
These authors have claimed that the increasingly jingoistic policies of many politicians of the majority community, as well as the ultra-nationalist politics of the Ilankai Thamil Arasu Kadchi (ITAK) established in 1949 dictated an irrevocable path to armed conflict that sapped Sri Lanka for over three decades. Majoritarian “Sinhala-Buddhist domination” is frequently cited by Tamil opinion writers as a major cause hindering Sri Lanka. In contrast, Sinhalese opinion writers point to the “excessive” set of demands of the 12% Tamil minority that began with their rejection of the Donoughmore constitution and the Eelamist demands for an exclusive Tamil homeland that grew out of the political platform of the ITAK.
The 1972 republican constitution of the SLFP-LSSP government became a pivotal juncture when the Tamil youth, inflamed by the violent propaganda, e.g., the poetry of Kasi Anathan, firmly embraced militant separatism. This was finally ratified by the Vaddukkodai resolution of 1976 crafted by the Tamil United liberation Front (TULF). Kasi Anandan had called for physical elimination of “thurogi” (traitors) who sought federalism or any form of power sharing with the majority. By then, several of the moderate Tamil leaders who had been named by Kasi Anandan had been assassinated. The TULF leaders were themselves assassinated and Tamil politics was hijacked by violent youth groups. The LTTE emerged out of the blood bath within the Tamil community to confront the Sri Lankan state militarily until the LTTE’s demise in 2009.
Historians, like K. M. de Silva, have characterised the Tamils as a minority who behave like a majority, while the Sinhalese are a majority who have behaved like a minority always fearful that the Tamil minority and Tamil-Nadu Tamils would act together and prevail against them.
However, both inter-Ethnic violence as well as intra-ethnic violence are fueled by the availability of discontented youth populations. Currently, Sri Lanka’s youth population has probably fallen below threshold for driving social upheavals, as Sri Lanka is now in demographic contraction. However, given the widening rich-poor gap, the residual youth populations still have the potential to spawn urban terrorist cells that can have an impact far beyond their numerical strengths.
Malaysia provides a strong counterexample to the type of social analysis presented by H. L. Seneviratne and others who argue that demotion of English and majoritarian jingoist politics were the key factors that have weighed in on Sri Lanka’s post-independence performance.
Malaysia emerged from British Malaya and by 1970 adopted Malay as the only official language. It demoted English completely, and made no room for the use of Chinese, the language of the 30% minority. Furthermore, Malaysia openly and unabashedly adopted a policy of discriminating in favour of Malay ethnics (60% of the population) who were named “Bhumiputra” (sons of the soil) with special rights and privileges in an Islamic hegemonic society. Unlike in Sri Lanka (where the leaders at least affirmed equality for all, or the wish to create just societies), Malaysia adopted an unapologetically chauvinist political programme.
In strong contrast to the political programme launched by elite leaders of the Tamils in Sri Lanka, the Chinese minority, basing on its previous experience of violence faced by them, followed a non-violent approach, ostensibly cooperating with the Malays, but concentrating on achieving hegemony in the mercantile and professional sectors.
Another factor that worked in favour of Malaysia was the absence of a significant Marxist political movement that could have deterred foreign investment or spawned nationalisation of successful private assets. Massive tax breaks and guarantees of labour stability enabled Malaysia to attract industrial giants such as Mitsubishi, Intel, HP, Texas Instruments etc., into its free-trade zones in the 1970s. At that time Sri Lanka was busy nationalising its tea plantations, driving out experienced managers to other countries such as South Africa and looking at foreign investors with a Marxist lens. Meanwhile, in Malaysia, majority and minority ethnic groups worked together in spite of political and linguistic discrimination, and today the average income of a Malaysian citizen is approximately five times that of a citizen of Sri Lanka.
A fragile facade
The Central Bank’s upbeat figures and the upgrade to middle-income status provide a vital psychological boost, but they reflect a temporary stabilisation rather than permanent structural health. A country cannot genuinely move into “safe waters” when its corporate elite is exporting capital, its professional class is fleeing overseas, and its remaining domestic population is rapidly aging.
Without aggressive structural reforms aimed at curbing trade mis-invoicing, incentivising talent retention, and preparing the economy for an aging workforce, the current economic growth will remain a fragile facade. If these three dystopian factors are left unaddressed, they will inevitably intersect, trigger a collapse in productivity, and rapidly destabilise Sri Lanka’s hard-won recovery. The leaders of the country, as well as the populace, irrespective of their political hue, have not appreciated the overarching importance of the three fault lines that we have described. They are enjoying the theatre of political arrests, jingoist exchanges and conspiracy theories even while their very firmament is trembling. The two ethnic groups that have fought each other will find that their communities face extinction because their TFR has dropped way below the 2.1 children per female that is needed to sustain their populations.
References & citations
[1] Central Bank of Sri Lanka (CBSL). (2026). Macroeconomic Developments and Estimates for First/Second Quarters 2026. Colombo: CBSL; and Central Bank of Sri Lanka (CBSL). (2026). Special Probes Report on Telegraphic Transfers and Fictitious Capital Outflows. Colombo: Financial Intelligence Unit.
[2] Global Financial Integrity (GFI). (2024). Trade Misinvoicing and Illicit Financial Flows in Developing Nations: A Focus on South Asia. Washington, D.C.: GFI; Global Financial Integrity (GFI). (2026). Trade-Related Illicit Financial Flows in Developing Asia (2013–2022). Washington, D.C.: GFI.
[3] National Chamber of Exporters of Sri Lanka (NCE). (2025). Annual Review on Export Sector Diversification and Off-Shoring Capacity. Colombo: NCE.
[4] Sri Lanka Bureau of Foreign Employment (SLBFE). (2025). Statistical Handbook on Migration Trends and Professional Brain Drain. Colombo: SLBFE.
[5] Hasini Lecamwasam, “The emptying university: why are academics leaving? (Island, 15th September 2026)
[6] Prof. Amarasiri de Silva, Sri Lanka’s university crisis: Brain drain and union action demand urgent reform (Island, 14th September 2026)
[7] World Bank. (2025). Sri Lanka Development Update: Navigating the Demographic Transition and Economic Recovery. Washington, D.C.: World Bank.
[8] De Silva, R., The Demography of Transition in South Asia: Emerging Trends (Colombo University Press, Colombo, 2025).
[9] Haldane, J. B. S., Daedalus; Science and the Future (Kegan Paul, Trench, Trubner & Co., London, 1924).
[10] Brig. Ranjan de Silva, This curse of partisan politics in Sri Lanka, Island 2026/09/4
[11] H. L. Seneviratne, The Work of Kings: The New Buddhism in Sri Lanka, University of Chicago Press (1999/2000).
Midweek Review
Ehipassiko :The virtues of ‘Seeing for Oneself’
by Sasanka Perera
(The writer is on X as @sasmester)
The ongoing controversy surrounding the internal disciplinary proceedings against Reverend Kekirawe Sudassana conducted by senior monks of the ecclesiastical order he belongs to–Sri Lanka Ramanna Nikaya–offers an opportunity to reflect upon dissent and discourse within Sri Lankan Buddhism. The inquiry is the result of a series of complaints made against Reverend Sudassana focused on his public discourses which have been widely shared in social media and other online portals.
As usual, this case too has polarised Buddhists in the public domain. Those in support of Reverend Sudassana see absolutely nothing wrong in what he has done and said. Similarly, those against him in the public domain, see nothing but wrong in all his public utterances and want him taken to task. Between these two extremes, the core meaning of the Buddha’s notion of ehipassiko, which literally means ‘come and see for yourself’, is completely lost.
I have followed some of the public statements and discourses of Reverend Sudassana for a while as part of my interest in popular religion. Much of what he has to say goes against long held beliefs and traditions in Sri Lankan Buddhism. I find his ideas shift between rationalism and noisy rhetoric, both not unusual in different manifestations of Sri Lankan Buddhism. For instance, the much-respected Anagarika Dharmapala was essentially a rationalist who wanted to focus on the dhamma and not on Buddhism’s rituals or even on gods. But this does not mean that Reverend Sudassana can be judged in the same way as Anagarika Dharmapala given the vast variation in historical epochs the two operated in and their different approaches to public discourse.
Reverend Sudassana has often critiqued what he sees as mythology and ritualism in Buddhism. For him, many long-held rituals and beliefs embedded in popular Sri Lankan Buddhist practices are irrational and therefore not acceptable. While to any rational thinking being, there is no contention here, one must concede that it is mythology and rituals that hold any core set of philosophical ideas such as the dhamma together as a religion. It is through these practices that religion as a matter of faith emerges from abstract ideas. This is common to any religion. It is through these practices that Buddhism, Christianity, Hinduism or Islam become religion as opposed to other philosophical ideas such as Plato’s and Socrates’ discourses or more recent trends in post-modern thinking, which do not constitute religion.
So, when Reverend Sudassana critiques and dismisses something so central to religion as belief and ritual as irrational, he needs to offer an alternative that would hold religion’s core ideas together. That, in my view, cannot be done by philosophy, the dhamma in the abstract sense or rationality as it is commonly understood today.
But when Reverend Sudassana argues against the over-commercialised merit-making practices, such as elaborate and very expensive pujas and certain customs that divert lay people from the Buddha’s pragmatic, core philosophical teachings, then, we have to pay serious attention to what he has to say. It is this kind of merit-making that I wrote about in 1995 with the use of the concept ‘grandiose religiosity’ that I coined to refer to expensive rituals and offering of alms.
Reverend Sudassana also stepped into the social minefield when he questioned the ordination of children at a very young age, inviting society to reflect on whether a child is mature enough to make a lifelong commitment to monasticism. He is not the first one to ask this question. Earlier critics include Gananath Obeyesekere and many others. This is an extremely important area that deserves the serious attention of citizens. Related to the same issue, Reverend Sudassana has also openly spoken out against child abuse within monastic environments, a topic that has traditionally been treated with strict institutional silence even through this has gained more traction as a public topic recently, at least in social media
Reverend Sudassana, through online commentaries has frequently targeted contemporary preaching styles of many Buddhist monks, explicitly calling out senior and popular monks who in his opinion perform ‘entertainment-driven’ or emotionally manipulative sermons (such as weeping while preaching) rather than focusing on true dhamma. Given the advent of what we may call ‘tele-monk’s or ‘online monks’, Reverend Sudassana’s criticism cannot be faulted if the comparison is only with the traditional preaching style of Buddhist monks. However, if this is the point of departure, then, Reverend Sudassana’s often combative style of discourse can also be critiqued in the same way. The issue in public discourse should be based on what preachers actually say and to what extent they take listeners closer to the dhamma or not. But often, such a reflective examination of dhamma content does not take place.
In certain ways, Reverend Sudassana has attempted to introduce a more rational interpretation of the Buddha as a historical figure and subsequent Buddhist history. From a historiographical point of view, this makes sense. The problem is, there is a vast variation between history as a formal academic discourse and belief in the past in terms of both perceived history and the past lives of well-known people. In the latter, there is not much space for rational reflection. That is why it is part of faith and not historiography. However, by trying to do this and attempting to separate what he views as historical fact from ‘literary or cultural interpretation’, Reverend Sudassana has drawn fierce opposition from orthodox factions of institutional Buddhism as well as many ordinary people who view his arguments as an attack on sacred text and tradition. What does all this mean? It is in answering this question that we need to reflect on the ancient Pali term, ehipassiko –‘come and see for yourself.’ In discursive terms, it is thought to be an open invitation by the Buddha himself to explore what he has preached rather than a demand for blind faith. The idea represented by ehipassiko is one of the six core qualities of dhamma in so far as the Theravada practice is concerned. the other five qualities include, svākkhāto (well-expounded by the Buddha), sandiṭṭhiko (directly visible or apparent right now), akāliko (timeless conditions, the results of which will be apparent when one practices), opaneyyiko (leading onwards to be applied within oneself) and paccattaṃ veditabbo viññūhī (to be personally known and realised by the wise).
Of these, ehipassiko is the most open invitation for reflection, which in my opinion goes very well with the Kalama Sutra or the Buddha’s charter of free inquiry. If Reverend Sudassana was motivated by ehipassiko and Kalama Sutra in his public discourses, he may have come closer to Buddhist ideals when it comes to Buddhism’s sympathies with freedom of inquiry. But at the same time, he has also moved considerably away from common sense dictating what is possible and what is not possible within the context in which he operates. First, complete rationalisation of Buddhist practice within an idiom of post-Enlightenment sense of rationalism is both not possible and dangerous. This applies to all religions. If this is done, then, faith will have to become mere philosophical reflection, thereby undermining what religion over time everywhere has done for humanity.
Second, what is actually possible to critique within the structures he is operating from (including his nikaya affiliations) needs to be clearly understood. What I can say as a scholar based on my research and reflection, are things a monk cannot say beyond a point as long as he is a monk. This common sense needs to be clearly understood if one is interested in reforming institutionalised Buddhism. It is in this area that many of the formal complaints against Reverend Sudassana have been made in the ongoing inquiry. There are numerous seriously problematic areas in his commentaries. These include claiming that the idea of karma is a myth and that rebirth is false. These are such core beliefs in Buddhism. One cannot critique them without disrupting the overall structure of the faith. But one can remain an unbeliever by virtue of personal choice but not make such opinions matters of public discourse. He has also claimed that specific powers such as the ability to read others’ minds, attributed to the Buddha are fictional. Again, beyond matters of rationality and within a discourse of faith, these things cannot be questioned in Buddhism in the same way they also cannot be in any other structure of belief. Reverend Sudassana has also been accused of providing problematic interpretations to long held positions espoused in the sutras and for claiming that that the Mahayana abhidhamma is superior to the Theravada version and so on. While the latter may be open to interpretation, Reverend Sudassana so far has not established that his grasp of the dhamma is adequate to offer such critical reinterpretations.
Third, endless combativeness is counterproductive if the aim is reform. It is much better to pick one’s battles on a rational basis rather than having a noisy opinion on everything under the sun. For instance, if Reverend Sudassana has issues with some of the less rational aspects of Buddhism like the Jataka stories, rebirth, specific rituals and so on, the better option is to underemphasise them in his sermons and public statements and replace them with life experiences of contemporary or historical times so that people understand the specifics of the dhamma being explained.
As for his more violent detractors on social media, my suggestion is to let the logic of ehipassiko come into play the way it was intended. Verbal violence, threats or ill-will have no space in Buddhism or in any decent society. If Reverend Sudassana’s discourses have negatively impacted disciplinary positions of his nikaya, I hope, they will be resolved through the kind of inquiry that is ongoing and even more importantly through broader reflection. But the senior monks in Sri Lanka Ramanna Nikaya must also reflect on why a discursive disagreement has generated this much internal reflection and interest leading to a formal inquiry at a time when very serious and continuous disciplinary and ethical violations by many monks, which are also now part of the public discourse, have not received the same attention.
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