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Indo-Lanka agreement on ECT:



* Govt. sticking to yahapalana commitment says SJB MP

* JVP asks whether selling national assets panacea for all our ills

By Shamindra Ferdinando

Samagi Jana Balavegaya lawmaker Dr. Harsha de Silva yesterday (15) said that the SLPP government had adopted the previous administration’s strategy in respect of the East Container Terminal (ECT) at the Colombo Port having repeatedly decried what it earlier called the sale of the facility to India.

MP de Silva, who also played a big role in the previous administration said that the SLPP earlier strongly opposed the involvement of India and Japan in the proposed Public-Private Partnership (PPP) to develop the ECT.

The former UNP State Minister de Silva said that the government certainly owed an explanation as regards the SLPP’s turnaround having had exploited the ECT issue to the hilt in the run-up to 2019 Nov presidential election as well as 2020 parliamentary election.

Responding to another query, the senior SJB member emphasized that the SLPP’s stand had always been that the ECT would be under the exclusive control of the Sri Lanka Ports Authority (SLPA). Therefore, the Presidential Secretariat statement that the incumbent administration negotiated the ECT agreement afresh with the SLPA having 51 percent of shares and the rest for the foreign investor, MP de Silva said.

Having repeatedly promised the ECT would only be developed by the SLPA, no less a person than President Gotabaya Rajapaksa at a hastily arranged meeting at the Presidential Secretariat on January 13 announced the 51:49 basis between the SLPA and the foreign investor.

The Colombo District lawmaker said: “The Terminal Operating Company was always a 51:49 joint venture with the majority of shares with the SLPA.”

Minister of Ports Rohitha Abeygunawardena, Secretary to the President Dr. P.B. Jayasundera, Secretary to the Ministry of Ports, Chairman of Sri Lanka Ports Authority and other officials and representatives of 23 trade unions had been present at the discussion.

The presidential declaration meant that the SLPP went back on one of its major promises. What had really happened was the SLPP endorsed the previous government strategy on the ECT, MP de Silva said, urging the people to be mindful of their strategies.

The SJB MP stressed that the then Opposition deceived the country with its high profile campaigns in the run-up to national polls in 2019 and 2020. President Gotabaya Rajapaksa told port unions the ECT would be developed with 51 per cent owned by the government and the remaining 49% as an investment by India’s Adani Group and other stakeholders

One-time Ports and Shipping Minister and SLMC leader Rauff Hakeem, now a constituent of the SJB told The Island that the Indian investment therein was nothing but a foregone conclusion. The lawmaker who is afflicted with Covid-19 threw his weight behind the project.

MP de Silva said that Sri Lanka entered into a Memorandum of Cooperation (MOC) with India and Japan in May 2019 on the ECT. The then Ports and Shipping Minister Sagala Ratnayake signed the MOC on behalf of the yahapalana government. Dr. de Silva said that he responded to The Island queries as a parliamentarian of the SJB as the party was yet to take a stand officially.

The agreement on the ECT was the first major investment on ports and shipping sector since China secured strategic Hambantota port on a 99-year lease for USD1.1 bn in 2017.

Trade union sources told The Island that major political parties represented in parliament seemed to be on one page on the ECT issue. The SLPP and the SJB parliamentary groups consisted of 145 and 54 members, respectively. The JVP with just three MPs is alone in campaigning against the agreement on the ECT though port trade unions affiliated to major political parties opposed foreign investment therein.

Former JVP MP Dr. Nalinda Jayatissa alleged that successive governments were bent on parting with critically important national assets. The JVPer asked whether selling national assets was the panacea for Sri Lanka’s ills. If such a strategy paid off, Sri Lanka would have been in a much better position today, the former lawmaker said.




Police failure to contain May 2022 violence explained



Police inaction to prevent arson attacks against SLPP politicians in the Western province on May 9 may have been due to orders not to carry weapons to deal with protesters, a new investigation has revealed.A review of the role of the police at the time showed Senior Deputy Inspector General Deshabandu Tennakoon had ordered all officers under him to ensure that no personnel were issued with arms and ammunition in the run up to the May 9 violence.

In his two-page instructions to DIGs, SSPs, SPs, ASPs and officers in charge of all stations in the districts of Colombo, Kalutara and Gampaha, Tennakoon had said no weapons or ammunition should be issued under any circumstances to officers deployed to deal with the protesters.

This order dated May 5 had not come to the attention of a three-member investigation panel headed by former navy chief Wasantha Karannagoda appointed to look into the security lapses. However, the panel had uncovered an order similar to that of Tennakoon issued by the then army chief Shavendra Silva.

Deploying police without even their own personal protection is seen as a violation of departmental orders and an internal investigation had begun, a top official source said.Meanwhile, the private residence of President Ranil Wickremesinghe was torched despite 400 air force men being deployed to protect it. The airmen did not open fire to deter a handful of attackers who scaled walls to enter the premises and set it on fire.

Instead of dealing with the arsonists, a police Special Task Force (STF) unit outside the Fifth Lane residence of Wickremesinghe attacked a television crew angering the protesters and encouraging more people to congregate there.

Several people identified through CCTV footage have already been arrested in connection with the arson at Wickremesinghe’s residence.However, action is yet to be taken against police and security personnel who failed to ensure law and order.

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SL will engage major T-bond holders for voluntary optimization: Governor



ECONOMYNEXT –Sri Lanka will not re-structure Treasury bills outside of central bank holdings and will engage with major T-bond holders for voluntary ‘optimization’ Governor Nandalal Weerasinghe said.

“There will be some treatment on central bank held Treasury bills,” Governor Nandal Weeasinghe told a creditor presentation Thursday.

“Other Treasury bill holdings will not be treated. Treasury bonds we envisage voluntary optimization.”

Sri Lanka has to at least extend the maturities of bonds to reach a gross financing need target averaging 13 percent of GDP in 2027-2032 based on projections in an IMF debt sustainability analysis. Of that foreign debt service has be below 4.5 percent of GDP on average.

“Local currency creditors participation in a debt optimization will help reaching the DSA targets,” Treasury Secretary Mahinda Siriwardena said.

“Authorities are exploring options for domestic debt operations aimed at liquidity relief while preserving financial stability to avoid further eroding Sri Lanka’s repayment capacity.”

The government and advisors will “invite consultations with major T-bond holders to gauge options and constraints”, he said.Governor Weerasinghe and Treasury Secretary Mahinda Siriwardene said Sri Lanka is likely to outperform the growth targets in the IMF debt sustainability analysis given past history. The IMF DSA is projecting 3.1 percent growth in the next few years.

Sri Lanka grew at rates around 4 to 5 percent during a 30 year war, but growth started to fall after serial currency crises hit the country under flexible inflation targeting with output gap targeting (monetary stimulus) during peacetime. In 2020 taxes were also cut for stimulus, going beyond open market operations and outright purchases of bonds seen earlier.

Meanwhile state spending went up from 17 to 20 percent of GDP under state expansionist revenue based fiscal consolation after spending based consolidation (cost cutting) was thrown out of the window from 2015 to 2019, critics say.

Sri Lanka is now trying to cut spending and excessive growth of the public sector, based on normal economic principles, to limit the burden of the unaffordable state on productive sectors and the poor, while preserving essential spending.According to the latest IMF program, fiscal consolidation will be “primarily” revenue based.

Sri Lanka’s Treasury bill and bond yields were higher than required due to uncertainty over whether they will be re-structured and the so-called ‘gilt’ status will no longer apply.

The lack of an early cut off date for domestic debt is a key problem in the IMF’s current debt resolution framework as domestic bond buyers are the last resort lenders after most foreign creditors stop lending, when the IMF says a country’s debt is no longer sustainable.

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Sri Lanka and debt advisors will engage with major Treasury bond holders, Weerasinghe said.

Key T-bond holders are Employment Provident Fund, Employment Trust Fund, insurance companies and banks.

Sri Lanka is also conducting an asset quality of review of banks.

Based on its results a debt optimization options will be offered paying attention to asset liability mis-matches, Weerasinghe said.

By preserving banking sector stability foreign investors are more likely to get repaid.

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BASL slams attempts to hinder Saliya Pieris, PC, appearing for a client



The Bar Association of Sri Lanka (BASL) has issued a statement on the recent string of protests launched against former BASL President Saliya Pieris’s decision to represent a client who had retained him. In the statement signed by BASL President Kaushalya Nawaratne and Secretary Isuru Balapatabendi, the BASL noted that the protests in question not only hinders the senior lawyer’s right to represent a client, but also acts as an attack on the profession at large.

Further, they noted that Article 13(3) of the Constitution of Sri Lanka specifically guarantees every person the right to a fair trial and the right to be represented by a lawyer of their choice.

The BASL also cited the 2019 Supreme Court judgment delivered in a landmark case together with the Judicature Act, the Code of Criminal Procedure and the Civil Procedure Code in favour of their argument. The Bar Association strongly demanded that the relevant authorities ensure that Pieris’s professional duties and safety remain unhindered.

Excerpts from text of the statement:

“The Bar Association of Sri Lanka (BASL) observes that there has been a series of organized protests in Colombo, in relation to Mr. Saliya Pieris PC, the Former President of the Bar Association of Sri Lanka, conducting his professional duties with regard to a particular client.

“We are of the view that the said protest, not only seriously hinders his right to represent a client, a professional right which has been safeguarded by law, but also an attack on the profession at large.

“In the case of Wijesundara Mudiyanselage Naveen Nayantha Bandara Wijesundara v Sirwardena and Others (SCFR 13/2019), the Supreme Court observed that: ‘The first piece of legislation passed by the Parliament soon after the promulgation of the 1978 Constitution was the Judicature Act No. 02 of 1978.

‘As the administration of justice in any civilized society cannot be effectively implemented without lawyers, the legislature in its wisdom, through the Judicature Act, established the legal profession. Thus, there is no dispute that the legal profession is a sine qua non for the due administration of justice in this country and for that matter in any civilized society. The said profession is essential for the maintenance of the Rule of Law and maintenance of law and order and its due existence is of paramount importance to the organized functioning of the society which is primarily the basis for the smooth functioning of the country as a whole.’

“Our constitution specifically guarantees the right to legal representation in Article 13(3) and

the Civil Procedure Code also provides for the right to legal representation in civil cases. Specifically, Section 24 of the Code allows parties to be represented by lawyers or other authorized representatives in court.

“Overall, Sri Lankan law recognizes and protects the right to legal representation, both in criminal as well as civil cases.

“Therefore, the Bar Association of Sri Lanka strongly demands that the authorities ensure that Mr. Peiris’s professional duties as an Attorney-at-law, are not hindered and, ensure his safety.”

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