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JVP stance on debt traps, fertilizer import bans, ports and PC elections

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by Saman Indrajith

The JVP says that the country is caught-up in what it calls ‘debt-trap diplomacy’ and warns that Sri Lanka is poised to lose more national assets in the immediate future. “Several rating agencies downgraded Sri Lanka’s sovereign credit ratings, the long-term foreign-currency issuer and senior unsecured ratings, while the long-term foreign-currency issuer default rating signalling concerns about the country’s ability to fulfil foreign debt repayments. In the face of this crisis, the government will either have to print more currency, borrow more or sell off national assets,” says former JVP Kalutara District MP and Politburo member Dr Nalinda Jayatissa in an interview with the Sunday Island.

Excerpts:

Q: Some ministers have made statements about the possibility of holding elections for provincial councils. Is your party ready for provincial council elections?

A: They started speaking of provincial council elections only after Indian Foreign Secretary Harsh Vardhan Shringla’s recent visit. The visit has jolted the government into action. The elections are to be held not because people have asked for them but because India wants the government to have them. This indicates the present plight of our nation. In 2019, Gotabaya Rajapaksa came to power under the slogan of ‘Rata Rakina Viruva’ (The hero who protects the country). Now that same hero has succumbed to pressure from India, the US and China and many other foreign powers.

Q: Energy Minister Udaya Gammanpila says that Trincomalee oil tank farm had been given to India by former governments in 1987 and 2003. The present government tries to show they are on a mission get the tanks back from India. What is your party’s stand on this?

A: We believe that Trincomalee harbour and the oil tank farm were the reason for India shoving the Indo-Lanka Accord down our throat in 1987. The then President was supportive of US camp while India was supporting the USSR bloc. President Jayewardene was considering giving Trincomalee to the US. India was upset and invaded the air space of this country, dropped parippu and sent Indian ships to our waters to terrorize that government and coerce it to sign the Indo-Lanka Accord.

The correspondence between Jayewardene and Rajiv Gandhi before the signing of the Accord shows that India would not let Lanka make independent decisions about the use of Trincomalee harbour without India’s concurrence. But such conditions are not included in the agreement. In 2003, Ranil Wickremesinghe’s government leased 99 oil tanks for 35 years to India for an annual fee of 100,000 US dollars. A Memorandum of Understanding was signed to reach an agreement in six months. It is only with the signing of such an MoU that the lease would have had legal effect. However there has been no such agreement since 2003. Therefore, India does not have any legal hold of the oil tanks and that land. Yet, they have paid the annual fee for the past 18 years.

Gammanpila is only putting up a show. The former ministers who had the Ceylon Petroleum Corporation (CPC) under their purview, Susil Premjayantha, Anura Priyadarshana Yapa and Chandima Weerakkody, got cabinet papers passed in 2011, 2014 and 2016 stating that those oil tanks belong to the Lankan government. India continues to hold those tanks illegally. One of our trade unions in 2017 filed a case at the Supreme Court against this. The decision is pending.

In terms of the provisions of the Ceylon Petroleum Corporation Act No. 28 of 1961, only the CPC can import petroleum to this country. Ranil Wickremesinghe broke that monopoly in 2004 and gave permission to Lanka Indian Oil Corporation (LIOC) to import fuel for 20 years with effect from January that year. That permission expires in December, 2023. Then the monopoly of petroleum importing, exporting, storing, refining, distributing and selling will return to the CPC. If government would not extend this permit, then India will lose its argument for the need to use Trincomalee Tank Farm. India’s present need is to get the oil tanks and the land they stand on for another 50 to 60 years. That was the primary objective of the Indian Foreign Secretary’s visit. Their actual target is the Trincomalee harbour and the oil tank farm gives them a foothold to move in that direction.

Q: So it’s all about Trincomalee harbour?

A: Yes, it is. Not a single harbour but many. The harbour in Trincomalee is considered one of the finest deep-sea, natural harbours in a strategic location. Sri Lanka’s geostrategic location is vital not only for the Asia-Pacific region but for the entire world. The importance of that location finally depends on the control of our harbours. We have three main harbours in Colombo, Hambantota and Trincomalee. What has happened to them? Hambantota is now owned by China for 198 years. It is China that controls the Hambantota port and its surrounding land of 15,000 acres. The Trincomalee harbour is being eyed by India. Then we have the Colombo Port, which is considered one of the busiest harbours in the Indian Ocean and is at No. 24 in the Top 50 World Container Ports list.

This position could be bettered if we could increase the depth of the access route to that port, deepen and expand the terminals and berths and increase the number of terminal operations opening the way for the world’s largest vessels to enter the Colombo Port. Now South Asia Gateway Terminal (SAGT) with berth of 18 meter depth is controlled by China. Mahinda Rajapaksa gave it to China for 35 years in 2012. Basil Rajapaksa recently brought a cabinet paper to give 13 acres of adjacent land to China to set up an operational and service center. So, even when the 35-year period ends, China will still have control there.

When China is given such hold, other countries also try to get a piece of the pie. The Selendiva project will enable selling many adjacent areas covering the Grand Oriental Hotel, Gafoor Building, York Building, Foreign Ministry and the old GPO. The Bank of Ceylon (York Street) is earmarked to be moved to Battaramullla, so that land too could be sold. There had been an attempt to give away the East Container Terminal (ECT) to an Indian company but it was suspended owing to protests. SAGT could be taken back by the Ports Authority in 2028. Currently it is under John Keells Holdings which is the local agent of India’s Adani Group that is involved in the West Container Terminal (WCT) development. After building that terminal, the two most important terminals of the Colombo Port will be controlled by China and India. This process shows how we have lost control of the three most important terminals during the past ten years. The income they earn is taken by foreigners to their countries leaving us with little.

Historical records show that the harbours have been among the most important feature in our civilisation. Recent archaeological findings yield evidence to prove that the Anuradhapura civilisation had been founded on the Mathota harbour which is said to be in Mannar. It was this harbour that supported the thriving Anuradhapura civilisation that constructed giant stupas and tanks during the 400 years from 150 AD to 250 AD.

During that period, South Indian traders invaded the Anuradhapura kingdom and ruled it intermittently when they had the control of Mathota and its resources. King Elara ruled that kingdom for 44 years and took away what it generated to South India. Later five other South Indian rulers before King Vattagamani Abhaya did the same. They took home what was earned from that harbour. They (the harbours) have been a principal prop of our civilisation.

Even when the Portuguese came here, they asked the King of Kotte only for one thing – that was to build a fort near the Colombo port. The present day rulers are depriving this country and its people the ownership of those harbours and thereby we lose the country’s geostrategic importance.

Q: The government describes those transactions as investments. Do not we need such investments?

A: China spent only USD 500 million to develop South Terminal of Colombo Port. The Lankan government took a loan of USD 1,400 million to build the Hambantota port. If the government took a loan of USD 500 million instead and developed the South Terminal of the Colombo Port, then we would have earned profits from there. China or India will not come here to invest in our health, transport or education sectors. Their investments have the objective of snaring us in a debt trap and taking control of our assets.

Even the previous governments used to have similar excuses. They used to say there were loss making enterprises which needed to be privatized. That has no place in the present times, so they use the word investments. For example, 40 percent of the Kerawalapitiya power plant is being sold to America’s New Fortress Energy (NFE). That plant is built and we could earn profits in the years ahead. Now it is being sold. The government is handing over the gas pipeline and floating storage system for the Kerawalapitiya power plant with the entire supply of gas to the NFE for a period of 10 years. There is massive waste, fraud and corruption in awarding this contract.

A contract has been awarded to the company without a tender to supply liquefied natural gas for 10 years at a cost of US$ 6 billion. Usually, we need electricity from the Kerawalapitiya power plant only between 6.00 pm and 12.00 pm. The ‘Take or Pay’ (TOP) deal to which we have committed ourselves is hugely disadvantageous as we will be paying for LNG we will not be using because we don’t need it. Could such deals be called investments?

This power plant is to supply around 35 percent of the power generated to the national grid. So NFE will have a near power supply monopoly in this country. It will also have the opportunity to place ships for floating storage near Colombo harbour permanently. These are not investments. If they really are investments, the government should have called for separate tenders for the floating storage and the pipeline and kept the ownership of the plant 100 percent. Gas could have been purchased at the world market prices through spot tender or term tender processes.

Q: The government says that there is economic instability therefore they are compelled to take such decisions. Is this true?

A: It is those whoz had governed this country since Independence, who should be held responsible for the current economic instability. As of now the country’s sum total of debt is nearly 17,000 billion rupees. Our total revenue is not sufficient to pay the loan and interest instalments. In this scenario, the government has solutions such as printing money, taking more loans and selling off national assets to pay the loans. It is said that the government has printed currency notes worth Rs 1,400 billions during the past 20 months. It is a sum equal to total government revenue for a year. This would certainly result in inflation.

People should ask the question why we have borrowed so much. We as a nation are trapped in debt raised for loans taken for mega projects some of which were not our priorities. A country with an economy like this should never have borrowed to build an International Cricket Stadium at Sooriyawewa, an International Convention Hall at Hambantota or the Lotus Tower in Colombo. These are neither essential nor priorities. The loans taken to pay for them were many times their actual cost with commissions ending up in the pockets of politicians. Whenever there are international exposés such as the recent Pandora Papers, many names of Lankans surface. They show how such commissions are stashed away in overseas accounts. What these political leaders do is show people a mega project and take their cut. When the loan cannot be settled they sell off national assets. This is the ultimate consequence of a process known as ‘debt-trap diplomacy’. We are in this plight because of a corrupt political culture.

Q: Hardly a day passes without a protest. Farmers stage protests everywhere in the rural hinterland demanding fertilizer. What’s the JVP standpoint on this fertilizer issue? Do you recommend continued use of chemical fertilizers?

A: The first excuse of the government when they abruptly stopped imports of chemical fertilizers, insecticides, weedicides and pesticides was that this was done to save dollars going out of the country. Then weeks later they said the ban was to save people from kidney disease and cancer. Organic fertilizers are fine but no country can switch from chemical to organic all at once. It is not feasible to ask farmers to go organic in the next Maha season soon after the end of Yala season. Farmers, agricultural scientists and everyone who dared to open their mouths in the Agriculture Ministry repeatedly said that this was not practical. But the President and the government did not listen. Now we are in a crisis. This will surely result in a food scarcity in a few months time.

The government says that it will compensate the farmers for crop losses if that happens. Such compensation would be sufficient only for few months for the farmers. But what about the food shortages? You cannot eat currency notes. This is just another example for the whimsical nature of this President. Apart from that there is a serious doubt whether this is just the beginning of a plan with the objective of compelling farmers to sell their land. When farmers cannot cultivate for two or three seasons, they have no option but to give up their livelihoods. They will have to sell their land or lease them to companies. This is an agricultural country. When agriculture is destroyed this country would go bankrupt in few years time.



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Features

‘Lord Edgware Dies’

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It has been some time since I read an Agatha Christie, the plot of which I cannot remember. So, I was delighted to find on the shelves of a friend Lord Edgware Dies, which I had a vague memory of, but no certainty about who had done it.

When I read it, I found that my memory of who was probably the killer was correct, but I could not be certain and the red herrings Christie threw in were so diverting that until almost the very end I wondered if I had been wrong.

The plot is very simple. Jane Wilkinson, who is married to Lord Edgware, tells him that she is desperate for a divorce since she is in love with a very proper Anglo-Catholic peer, Lord Melton, but Edgware refuses to divorce her. She asks Poirot to talk to him, which he does, and is surprised to find that Edgware has told Jane he is prepared to give her a divorce. This was, after he had categorically refused, through a letter, which Jane said she had not received.

That night Edgware is murdered, after Jane had been to see him, or so the butler said, and also Edgware’s secretary. But Jane had been that evening at a grand dinner many miles away, where a dozen fellow guests could swear to her presence.

There was a solution however to the mystery of two Jane Wilkinsons, namely a skilful impersonator called Carlotta Adams who, in the opening chapter had impersonated Jane Wilkinson, who had also been at the performance. But when Poirot goes to see her, he finds that she had been found dead on the morning after Edgware had been killed, of an overdose. And in her bag was a gold case, with a strange inscription, that contained the drug, along with a pair of pince-nez.

Her maid said she had written a letter to her sister in America and posted it the previous night. Poirot asks Inspector Japp to get the letter, and a transcript is received from America, and in it the name of Edgware’s nephew Ronald Marsh is mentioned; he had taken Carlotta to dinner after her performance, with which the book opens, and had then set her a challenge. Japp arrests Marsh, but Poirot is not happy and asks for the original of the letter, which the sister sends him. That shows that a page is missing, and the tear is obvious, though that raises the question as to why it had not simply been cut.

Matters are further complicated by the fact that Marsh had gone in a taxi to the Edgware house, along with Edgware’s daughter Geraldine, in the interval of an opera which had previously seemed to provide them with cast iron alibis. Geraldine had gone in to fetch her pearls so that Marsh could raise money he needed, and thus had an opportunity to kill Edgware, as did Marsh, for the driver said he had got out of the taxi while waiting and gone into the house.

Agatha Christie

Marsh explained why he had gone to the house on the night of the murder as having followed Bryan Martin, an American actor, who had been in love with Jane, whom he saw go into the house with a key. But there was no one visible when he entered, and Geraldine almost immediately came down and they left together. And Martin too has become an object of suspicion to Poirot, for he had been to see him before the murders were discovered with a story of being followed by a man with a gold tooth – a story Poirot immediately realized was false when he was asked how old the man was, and was told he was young, for young people did not have gold teeth.

A heap of French money Edgware had got for a trip to Paris was missing, but since Marsh had no need for it after his cousin’s offer of help, Poirot deduces that it must have been taken by the butler, who has disappeared. Christie has stressed that he is astonishingly handsome, unusual in a butler, and Poirot notes a resemblance to Martin, so he thinks the mysterious man going into the house must have been him.

Incidentally, later Poirot assumes that Edgware’s change of mind was because he was involved in some scandal, and I believe Christie intends us to see the cause of this in his handsome butler, though this is not specified.

Meanwhile, Poirot has asked Japp to find out the provenance of the case found in Carlotta’s handbag, and it turns out to have been made in Paris, specially commissioned, and collected by a woman with pince-nez.

But then another murder occurs—that of another guest at the grand dinner, which provided Jane with her alibi. The victim is an actor who had been bemused when Jane, at a lunch, thought the Judgment of Paris referred to the city. He told Hastings he wanted to see Poirot, but was killed before he could get to the appointment. Poirot had rushed there when told about his request, but it was too late.

Meanwhile, Poirot has tried out the pince-nez on Edgware’s secretary, but she could not see through these. It was only a chance remark heard outside the theatre that led him to try them out on Wilkinson’s maid Ellis, a spare pair that had been appropriated for the night of the murders.

Poirot then lays things out, having summoned Martin and told him that he probably suppressed Edgware’s letter, as he had been dropped by then and he did not want Jane to marry another. But after teasing Martin, Poirot says that Jane was in fact the murderer, and she got Carlotta to impersonate her at the dinner while she went to the house and killed her husband. After meeting Carlotta later and checking with her through a call that she had not been rumbled, Jane had gone ahead with the murder – she put veronal into her drink and the case with veronal into the handbag. She forgot to take out the pince-nez she had used earlier to imitate an American. Carlotta had registered as the American in a hotel and Jane had gone to see her, and there they exchanged identities. After seen the letter, she made use of it by tearing off the page that referred to her, and the S of She, so that the person who had challenged Carlotta to impersonate her seemed to be a man.

There is a coda in which Jane, condemned to death, writes to Hastings, still full of pride at her ingenuity hoping she will be remembered.

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Desilt reservoirs, learn from our ancient irrigation systems

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Polgolla

by Prof. O. A. Ileperuma

Silting of reservoirs is a major problem today affecting our hydropower production and irrigation systems. The main Mahaweli reservoirs are silted to a considerable extent reducing the water holding capacity of them. Due to poor soil management practices, floodwaters deposit large amounts of silt in these reservoirs. When the Polgolla reservoir was fully drained about two years back, one could see mountains of silt in the lower reaches of the reservoir. A rough estimate is that 50% of the total capacity of these reservoirs has been lost to siltation. This is a serious issue which affects not only power and agriculture but also flood control.

Our ancient irrigation systems ensured that desilting of reservoirs took place under royal decree where all users of the reservoirs were ordered to carry out desilting of reservoirs during the dry season. The clay thus collected was used in making bricks for the construction of great stupas which dot the landscape of our ancient kingdoms. This ensured that the reservoirs had their full capacity filled with water for the next cultivating season. Our ancient kings were clever enough not to construct reservoirs by blocking main rivers such as the Mahaweli. A classic example is the Minipe left canal where they tapped only the surface water of Mahaweli. Even the bigger tanks such as Nuwara Wewa and Parakrama Samudraya were fed with minor rivulets. There were also other ingenious features in the cascade irrigation systems built by the ancient kings, such as mud sluice canals and forest reservations between the reservoirs in the cascade system. These reservations helped trap silt and remove excess nutrients, which could otherwise contribute to increasing salinity as water flowed from one reservoir to another.

Victoria

Moragahakanda

A classic engineering marvel is the former Yoda Ela, which carries water from Kalawewa to Nuwara Wewa and Tissa Wewa. It is 87 km long although the straight distance between these points is only about 40 km. The gradient of this canal is about 10 cm per km or 6 inches per mile. Yodha Ela functions as a moving reservoir and feeds about 4,600 hectares of paddy lands. It is a winding canal with about 120 smaller reservoirs on its way. It was constructed during the reign of King Dhatusena around 459 AD and later expanded by King Parakramabahu by connecting more reservoirs to the network. Unfortunately, during the Mahaweli project our modern-day engineers constructed a concrete canal replacing the winding path of this Yoda Ela also called Jaya Ganga. This effectively removed the ability of the old Yoda Ela to remove silt and nutrients. The bank of this Ela has wet zone trees such as jak and areca nut growing well. They take up the nutrients from the flowing stream making the water suitable for irrigation later.

Ancient Mesopotamian civilisations depended on dams constructed along the two main rivers, Euphrates and Tigris. After continuous irrigation of their fields over several thousand years, salinity of the irrigated lands increased making them unsuitable for agriculture. People died due to famine and this clearly illustrates the danger of blocking main rivers for agriculture. There is scientific evidence that the salinity of paddy soils in the Mahaweli C area is increasing.

We saw the devastation caused by Cyclone Ditwah. The sluice gates of the Kotmale Reservoir were opened, and Kandy and Peradeniya were flooded. If the reservoir had had greater storage capacity, couldn’t the opening of the gates have been delayed? This may not be an argument that modern-day engineers would readily accept, and I am not an irrigation expert. These ideas may well be naïve. But most of us tend to think of reservoirs mainly in terms of hydropower generation and irrigation, while their role in flood control receives much less attention. The question therefore deserves serious consideration. Could restoring lost reservoir capacity through desilting help improve our ability to manage extreme rainfall and reduce flood risks?

Desilting our reservoirs should be considered a national priority.

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Losing out to Ethiopia

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From Trailblazer to Tailender

Export diversification – Missing the wood for the trees – Part III

by Gomi Senadhira

In Sri Lanka, the word “Ethiopia” is often used as disparaging slang to describe individuals or areas experiencing extreme poverty, starvation, or severe economic hardship. This linguistic habit originated in the 1980s with the Western media coverage of the devastating Ethiopian famine of 1983-85. That media coverage shocked the world but also left an outdated and offensive global stereotype that the country is permanently starving. Much has changed since then. By now, with an annual growth rate of around 9%, it is the fastest-growing economy in sub-Saharan Africa. Ethiopia has also emerged as a highly competitive exporter and is challenging not only its competitors in the region but also countries like Sri Lanka. This article is on how Sri Lanka has lost ground to Ethiopia (and a few other countries) in the GCC markets for agricultural and floricultural products.

Sri Lanka – A Pioneer in the Agriculture and Floricultural Market in the GCC

As discussed in Part II of this article, by the mid-1980s Sri Lanka had established a strong foothold in the GCC’s fruit, vegetable, and floricultural market. Geographical proximity and well-established shipping and air links gave Sri Lanka a strong comparative advantage over Southeast Asian and African nations. Thailand, Vietnam, and Kenya were not even in the market. At that time, Ethiopia was experiencing (as BBC news reports described) “a biblical famine”.

The market was not very large, but it was lucrative and growing. Trade Minister Lalith Athulathmudali as well as the Chairman of the Export Development Board, Victor Santiapillai, who visited Kuwait (and the GCC countries), recognised the market potential for these products and encouraged us to continue with our work. The minister was particularly keen to further develop links between the market for these products, exporters, and his Export Production Villages (EPVs). So, it was becoming a successful case not only for export diversification but also for transferring gains from exports directly to rural households.

From Trailblazer to Tailender

As a result, even by the beginning of this century Sri Lanka had a larger market share than most of its competitors from Asia or Africa. But since then, our competitiveness has weakened significantly. The tables below provide a comparative snapshot of Sri Lanka’s performance vis-à-vis Thailand, Vietnam, Kenya and Ethiopia in the GCC market for vegetables, fruits and floricultural products. As illustrated therein, in 2001 Sri Lanka was ahead of Thailand, Kenya and Ethiopia in this small but rapidly growing market. Since then, we have fallen behind Thailand, Kenya and many other countries in that lucrative market. If this trend continues, Sri Lanka will fall behind Ethiopia within the next few years. (See Table 1)

In the GCC market for vegetables (covered in HS chapter 07), Sri Lanka was ahead of most other competitors in 2001. As illustrated in Table 1 , Sri Lanka had failed to develop this market, while Thailand, Kenya, and even Ethiopia had very efficiently increased their market shares. The GCC is a market to which Sri Lanka can supply some vegetables, like cabbages, by sea. It appears Sri Lanka had also failed to exploit this mode of supply.

We can see a similar trend in the market for fruits. Vietnam, Kenya, and Thailand have emerged as major players, while exports from Sri Lanka have staggered on slowly. In this segment, Vietnam has emerged as a leading player during the last twenty years and the GCC imports from Viet Nam have shot up from US$44 thousand in 2001 to US$346 million by 2024. In part one of these articles, I discussed the remarkable increase of jackfruit exports from Vietnam “…just $3 million in 2015 to an impressive $236.8 million in 2023” while most of our jackfruit production rots under the trees. This explains how countries develop their markets, geographically and product-wise. (See Table 2)

Sri Lanka’s performance has been weakest in the market for floricultural products (HS Chapter 06), which groups live trees, cut flowers, and ornamental foliage. When we first entered the market in the 1980s, the market was dominated by the Netherlands, and Kenya and Ethiopia were not even in the market. At that time, we identified the Gulf states as a market where Sri Lanka could have a dominant presence due to geographical proximity. Even in 2001, Sri Lanka was ahead of Kenya, Ethiopia, and Thailand. But by now, Kenya has emerged as the dominant supplier. Ethiopia is also expanding its market share and is the third-largest exporter. (See Table 3)

Missing the Wood for the Trees

In the mid-1980s, Sri Lanka first established its foothold in the GCC market. Since then, Thailand, Vietnam, Kenya, and even Ethiopia have moved well ahead of us and have become leading players. Why did we lag behind in our export diversification efforts in general and, more particularly, in the GCC market?

The reasons are very clear. After the initial attempts in the 1980s and early 1990s, Sri Lanka has not been proactively involved in identifying, developing, and promoting new products and markets, or protecting and further developing new markets already established. The focus has simply been on traditional exports: tea, coconut, cinnamon, and garments, while other products were almost ignored. In essence, we have been and continue to focus intensely on a narrow group of products and markets, and we have lost sight of the bigger picture.

(The writer can be reached at senadhiragomi@gmail.com)

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