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Sri Lanka’s slide from Perpetual Bonds to Pyramidal Sugar Bags



by Rajan Philips

A political observer with an exceptionally sharp mind offered this online comment recently: “With little on offer as a political alternative, many of us seem to wallow in idle gossip and pin hopes on plain speculation.” Who would disagree? Except to add that gossip, speculations and outbursts are emanating more from within the government than from outside, indicating both frustration and helplessness in government ranks. As well, those who heralded the present government as once-in-a-generation of its kind – headed by the best ever non-political Sri Lankan to seek political office for the sake of the old country after forsaking the new, and those who sang hosanna to the highest from the outside, are now left with sugar on their faces. Literally. The sugar scam is not the only scam. And where there is no scam, there is rampant incompetence.

The question is how could a new government elected with unprecedented double majorities (one for the executive and another for the legislature) have come a cropper so early in its mandate? There was no want of goodwill. Even critics of Gotabaya Rajapaksa wanted the man to succeed as President. For the sake of the country. More so, after Covid-19 struck. And Covid-19 is no longer an excuse. If at all, the pandemic has become the biggest cauldron of examples for government confusion in decision making, crass sloppiness in dealing with medical professionals and scientists, and chaotic incompetence in rolling out Covid-19 vaccines.


One term too many?

One can see the manifestations of internal frustrations in Wimal Weerawansa’s warnings and outbursts, and in the responses and speculations of SLPP Parliamentarians. Mr. Weerawansa, before his latest outburst about Rishad Bathiudeen, was all about crowning President Gotabaya Rajapaksa as leader of the SLPP to let him learn the ropes of politics, as party leader, to become a successful president. The SLPPers, on the other hand, besides accusing Weerawansa of backstabbing and calling for his dismissal, have started speculating about a one-term presidency for Gotabaya Rajapaksa and musing about Basil Rajapaksa as the next patriotic presidential candidate with possible American affirmation.

What is going on? Who is getting tired of whom? After all the struggle of getting a two-thirds majority in parliament, is President Gotabaya Rajapaksa being coaxed and cajoled to limit himself to a single term? Or is it that he has had enough of this powerful but ineffectual presidential charade? Is one term too many even with a two-thirds majority?

Perhaps a more significant manifestation of the government’s internal troubles is in the work of the three parliamentary committees on – Public Finance (COPF), Public Enterprises (COPE) and on Public Accounts (COPA), and in the apparent audacity of their Chairmen, all government MPs (respectively – Anura Priyadarshana Yapa, Charitha Herath and Tissa Vitarana), to act with some independence and without looking for directions from the executive. It is their persistence that is widely believed to have forced Finance Ministry officials to come clean with the chronology of decisions and import activities behind the nearly Rs. 16 billion swindle in importing sugar.

I am inclined to see some difference between the antics of Weerawansa and his SLPP detractors, on the one hand, and the workings of the three parliamentary committees, on the other. Taking note of this difference has some relevance to discussing the current political quagmire and the absence of serious alternatives. And the difference is that the Weerawansa/SLPP responses to the government’s paralysis are an indication of the tired and tatty state of the executive presidency as a political system regardless of who the incumbent president is. As against this, the workings of the parliamentary committees are indicative, no matter how slimly, of the possibilities of parliament in spite of the current presidential incumbent and the two-thirds majority he commands in the legislature.


Bond scam and Sugar scam

Looked at it another way, there are also differences between the way the executive and the legislature responded to the bond scam of the last government, and the way they are responding to the sugar scam of the present government. The last government used parliament to do a more prolonged cover-up job than the present one. The current parliament has done a far more effective policing job with the sugar scam than its predecessor did with the bond scam. The JVP which was on mute mode for most of the bond saga, is now breathing fire and burning the government’s sugar, and has taken the case of the stolen sugar all the way to the Supreme Court. UNP MPs who were all for coverup then until it was too late, are now all reborn SJBers demanding total accountability.

One might also notice other curious similarities and contrasts. There was a Central Banker, the then Governor, no less, Arjuna Mahendran, who was in the eye of the bond storm. There is an indirect connection to the Central Bank now, through the current Finance Secretary, S.R. Attygalle, who is also a former Deputy Governor of the Central Bank, and who has had an interesting career path since then. He was one of the principal public service beneficiaries of the Sirisena-coup government that lasted from October 31 to December 18 in the year of constitutional grace – 2018. President Sirisena appointed Mr. Attygalle as Secretary Treasury displacing Dr. R.H.S. Samaratunga. When the Supreme Court pulled the plug on Sirisena’s childish coup, Attygalle had to give way to Samaratunga. But he was back within a year, and his was one of the first senior appointments by Gotabaya Rajapaksa when he became President in November 2019. Wheels within wheels? It is not only politicians who are caught in the web of unholy alliances, but high-post public servants are also not spared from them.

Back to sugar scam, Mr. Attygalle tried to make the far fetched argument to the Finance Committee that the government did not actually lose any money because of the reduction of import duty on sugar from 50 rupees to 25 cents per kilogram, because the government had not collected any money to lose! But that does not explain how the government set it up so beautifully that the state would not collect any money that should normally have flowed to its coffers. Here is the chronology from what has been quite well reported on the matter. In May 2020, the government raised the special commodity levy (SCL) from Rs 33 to Rs 50 per kilo – with all the good intentions of lowering imports, saving foreign exchange, boosting local production, and, lo and behold, fighting diabetes, obesity, and other sugar ailments. In less than five months, on October 13, the SCL was slashed from Rs 50 per kilo to, not Rs 33 but Rs 0.25, twenty five cents per kilo. The import floodgates were opened.

Between October 14 and February 20, 320,627MT (metric tonnes) of sugar was imported in four months, about 50 to 60% of annual sugar imports between 550,000 to 650,000MT. On November 10, under panic in the face of rising sugar prices and unable to control the flood of imports through licensing and permits, the government imposed maximum retail price (MRP) limits ranging between Rs 80 and Rs 90 per kilo for wholesale and retail sales of bulk and packeted sugar. But the price limits didn’t work either. Sugar prices were between Rs 118 and Rs 125 per kilo during the four month interval. The government forced Lanka Sathosa, the national retailer to sell at the maximum retail price after buying at much higher prices in the wholesale market. In the upshot, the helpless consumers were gouged, nobody knows how many diabetes patients benefited, and the government lost doubly in collections, at the customs gate and at the national retail counter. Yet it was no loss, by Finance Ministry accounting, because there was no money to lose. Remember Greek Bonds?


From Perpetual to Pyramidal

For whose benefit was this sham? The Finance Ministry has reportedly admitted that six major sugar importers potentially “earned a kind of additional profits.” The pie-chart on this page shows the major sugar importers during the October-February window and their import quantities. Leading the pack was Pyramid Wilmar Limited (PWL). An acknowledged giant in global sugar trade, PWL accounted for 40% of the sugar rush and reportedly diverted a shipment meant for another destination to sail to Colombo to take advantage of the slash in Sri Lanka’s import duty. It was not just another shipment that arrived on short notice but, as the Sunday Times reported last week, the largest sugar cargo to dock in Colombo in 30 years, with 26,000MT of sugar in 1,000 containers. PWL was also well positioned to benefit from the slashed duty, because unlike other importers, it was eligible to pay the 25 cents (instead of Rs 50) per kilo duty not only on new imports but also on old stocks held in its bonded warehouse.

It is not only sugar. The same sugar daddy is said to have had a trial run earlier with coconut oil. Except it was no trial run because the swindle was even bigger – Rs. 20 billion, according to reports citing SJB MP Patali Champika Ranawaka. To sugar and coconut oil – add rice, the nation’s staple, and turmeric, the popular Covid-19 neutraliser, and Sri Lanka has the textbook example of what Prof. WD Lakshman, the current Central Bank governor, has described as the government’s “alternative way” of managing the economy.

To elaborate, about a month ago , around February 12, Governor Lakshman was taking to task the “doom and gloom” critics of the government for their failure to appreciate “the government’s determination to move away from the, so far, heavy dependence on imports for foodstuffs.” He called it a “really significant long term policy approach despite in the short run there is an adverse impact in the prices.” He referred to the import ban on turmeric, the immediate price increase, and the eventual stabilization (apparently). “But now nobody is talking about turmeric,” he said. No Sir, now everyone is talking about sugar!

And rice too! There is some confusion in the government about the adequacy of rice/paddy stocks. On Friday, The Island editorial highlighted the confusion within the government whether there is or there isn’t a need to import rice. 100,000 MT of rice should be imported according to some government Ministers, but Basil Rajapaksa, the non-cabinet Task Force Minister has been assuring that there is plenty of paddy in the country. Hoarding is certainly the curse, but isn’t there anyone in the government who knows whether there is enough rice in the country or if it should be imported. As government priorities go, Dr. Tissa Vitarana issued this caution in his weekly Sunday Island statement: “Hunger needs to be overcome before highways and high life!”

Talking about high life and politics, the political connections of Pyramid Wilmar Limited in Sri Lanka are not unlike those of Perpetual Treasuries Limited that was the central entity in the earlier bond scam. Media reports say that the local agent of Pyramid Wilmar, is Sajaad Mohammaed Mowzoon, who is also the proprietor of Shangri-La Hotel. It is well known that it was at Shangri-La that Gotabaya Rajapaksa launched his saubhagya project under the auspices of Viyath Maga. Mr. Mawzoon is also reported to be having business connections to the Adani Group, India’s mover and shaker in port development business among other portfolios. The Adani group has been making waves between the East and the West Container Terminals at the Colombo harbour, and now we hear more than rumours of a potential business partnership between two powerful political benefactors in India and Sri Lanka.

And where high life wrongfully pursued will take you became evident in the Colombo High Court last week, with the indictment of former Finance Minister Ravi Karunanayake and eleven others in connection with the 2016 Central Bank bond auctions. The Court also ordered to remand the accused who showed up till March 23, when the case will be taken up again. Those who stand accused deserve their day in court and to have what they say heard. But indictments in Sri Lanka are not what they used to be before the turn of the century. There is more public cynicism about indictments today than there is respect for them, for their impartiality and consistency. Even so, the indictments served last week are still a reminder that what is sauce for one political goose today can be sauce another goose tomorrow.



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An air of discontent prevails



We have had a series of “Avurudhu parties” here in Aotearoa. No shortage of Kavum, Kokis, Athiraha, and even Wali Thalapa. Buffalo curd available locally and of course imported treacle in abundance. Yours truly has assumed the role of a fly on the wall during these festivities and gleaned much information, worth talking about.

First to get on to the Pearl, the talk of the botched-up vaccination plan and running out of the second dose of vaccine. Bizarre permutations as to what would happen if the second dose was not available on time and to who would be press-ganged into getting the “dodgier” types of vaccine from China and Russia, etc. The possible repercussions of getting a second dose of another type of vaccine to the original, the speculations of which left me rather glad that the general populace of Aotearoa has not been vaccinated to date. The talk moved on to the Easter bombings and the recent comments by leaders of the Roman Catholic church as to the possible perpetrators of the attack. Some increasingly obvious conclusions as to those responsible for the planning and funding of same are being reached by those other than some of us who dared to voice our opinions over a year ago! This combined with the increasing and very rapid unpopularity of the person they elected to high office hoping he was genie of the magic lamp type, and the possible reverse of Hong Kong that could take shape on the reclaimed land near the Colombo port, does not bode well for an already dubious future. By reverse of Hong Kong, I mean Hong Kong is trying to hold out as a bastion for democracy, whilst the proposed port city seems to be modeled on the opposite!

Moving on to Aotearoa, the rest of the world seems to be praying for a leader such as our own Jacinda Ardern, but the fat cats of Aotearoa are getting rather sick of her. Those who own multiple houses and have been setting off their interest payments against their taxes due to a loophole in the law that has now been plugged are grumbling. The fact that most young people can’t afford to buy their first houses due to rich people and property developers snapping up all available property, happily funded by banks who are only interested in the bottom line, is of no consequence to them. The fact that this could lead to so much discontent that it could even lead to armed insurrection doesn’t bother them. They seem to have forgotten that we have had almost no deaths and hardly any Covid 19 cases in our community when they say that the lockdowns, we underwent were too excessive and how the economy and business sector has suffered. These very people throng the stadia during the rugby and cricket games and enjoy music concerts with gay abandon. Megacorporations are not happy about the restrictions that are coming on with regard to the use of Liquid Petroleum Gas (LPG) due to environmental concerns. To top it all off I had a lecture from my 13-year-old daughter about how I am being “led by the nose” by Jacinda Ardern and her propaganda! Where she got that from could only be from her elder brothers whose get rich quick schemes have seen a setback due to certain leftist policies coming in from the Labour government that is in power with an absolute majority.

I laugh to myself and think about other examples I have seen of self-proclaimed pundits never being content with their lot. My education was in a very large Government school. As a perfect and a member of some sports teams we handled the administration and some of the governance of this school. Later in life when my children were attending a private school I got involved in the Executive committee of the PTA of that school. The “problems” faced by the private school and the vast dramas that were involved in trying to solve those problems were laughable when compared to those faced by even us, senior students (a much lower level in the administration) of the Government school.

It led me to believe that people always grumble. They are never content with their lot and there is always someone plugging their case and trying to sow the seeds of discontent among the populace. If those living in Aotearoa, in the present situation and well aware of the chaos and mayhem that is prevailing in the rest of the world are dissatisfied, when will anyone be satisfied? Everything is relative and one should try to step outside the confines of one’s own situation and look at the broad picture. In the words of learned barristers, I rest my case!

This week’s missive will not be complete without a tribute to the memory of Prince Phillip, the Duke of Edinburgh. He lived through some of the best and worst times of human existence on this planet and conducted himself impeccably. He showed his humanity and his failings, with a few bloopers down the line but most of those had an undercurrent of humor and couldn’t really be construed as offensive, despite the best efforts of the media and others to make them so. He served as consort to her Majesty the Queen with loyalty and aplomb and he leaves behind an enviable legacy in the world of conservation and youth affairs. It is hoped that his heirs will be up to the task for they face a task which in cricketing terms could be classed as coming into bat after the great Sir Vivian Richards had just scored a century, in his prime. Something very difficult to surpass in skill and entertainment value. Unfortunately, the Duke made just 99. May he rest in peace!


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We have much to learn; and emulation is no disgrace



“Imitation is the sincerest form of flattery that mediocrity can pay to greatness.” said Oscar Wilde who, through sharply ironic wit, often proclaimed the absolute truth.

Cassandra quotes him today as she wants to point out how much we in Sri Lanka can benefit by reaping some ideas from the recent royal funeral in Windsor. And she does not excuse herself for placing stress on our mediocrity as juxtaposed with greatness. Nationalists may shout themselves hoarse and bring down a few more majestic trees by decrying the comparison. They can justifiably claim we have a cultural heritage of two and a half millennia but have we remained cultured, following faithfully and correctly the four great religions of the world? A loud NO from Cass, echoed by millions of others. Though Britain’s development of the English language, culture, arts and science was later than our civilization, they outstripped all countries at one time and are again elevated, while we are poised on bankruptcy, with the begging bowl in hand and thugs and thieves as legislators. We in Sri Lanka are mediocre if not degraded against the greatness shown by the Brits in many spheres. This is no Anglophile speaking but a dame who was born when the Brits were leaving us to govern ourselves and grew up with our statesmen doing a jolly good job of it; Sinhalese, Tamil, Burgher, and a few Muslims taking the lead graciously and effectively with complete honesty, to serve the people. They maintained and improved our country so it was admired by others and even some desiring to imitate Ceylon as Singapore’s Lee Kwan Yew admitted. And where are we now? Except the Rajapaksa family from Medamulana, wearing rose tinted glasses or with eyes shut by arrogance, and their followers and throngs of sycophants, others see our country and our people for what it, and the people, really are. No need to elaborate.


The funeral of Prince Philip juxtaposed against customs here

The low-key funeral observing all Covid-19 restrictions was noteworthy for being utterly devoid of bombast and vainglory. It was dignified and moving. Cass wonders how many of her readers watched the funeral on Saturday 17, late evening here. Prince Philip had detailed all arrangements from the Navy being prominent and other Forces joining in plus the substitution of the gun carriage with a jeep he had helped design. The horse carriage he was adept at racing was stationed close by the entrance to the chapel. He has bequeathed it to the daughter of his youngest son and Sophie; the Wessexes having been very close to him and the Queen.

The entire proceedings proved first and foremost that the royal family observed strict pandemic restrictions like mask wearing and physical distancing. There was no one rule for them and another rule for us, thus proving beyond doubt that England (usually), and more so the Royal Family (definitely) are a country and an institution despising double standards. The monarch decreed and abided by the same regulations that have restricted everyone else in the UK, sharing their fate. An anecdote is relevant here. The Queen learned that lesson long ago. She was 14 when her mother said, after Buckingham Palace was bombed in September 1940, that she “could look the East End in the face now.”

Do all our people follow rules common to everyone? Oh! My heavens NO! There are differentiations according to layers in society. Shangri La would host a party for a hundred when only 30 are allowed to gather. During the height of the first wave when restrictions were strict, SLPP electioneering saw hordes thrust together and baby carrying, patting heads and hand clasping mostly by Mahinda Rajapaksha sans a mask. He has a charismatic bond with the masses but that needed to be curbed. Sajith Premadasa’s meetings were strict on physical distancing and mask wearing.

Only 30 were invited to the extremely solemn and yes, beautiful funeral service at Windsor Chapel. This meant eliminating even close relatives of the Family; but it was done. The Queen sat distanced from her daughter and sons and their spouses. Her now diminutive figure seated alone emphasized the loneliness she must be feeling after a close and successful marriage of 73 years.

This brings to mind our First Ladies. Cass steps out bravely to say that Elina Jayewardene was a gracious lady of restraint and dignity, the only perfect consort so far. Cass remembers Hema Premadasa beating her breast (true) and crying over the coffin of her late husband’s remains – in the true sense of the word – at the Prez’s funeral at Independence Square. There is dignity in restraint of even tears over a death in public. Among the women Heads of the country, the mother completely beat the daughter in dignity and ability.

We Sri Lankan women are now much more restrained in our mourning at funerals. Time was when widows even hoarsely wailed their sorrow, coiled and roiled with grief, and begged the dear departed “To look once more; say one word.” Cass in all the expressed grief of such funerals suppressed her laughter with difficulty. How would it be if the corpse obliged?

The choir at the funeral of Prince Philip was just four – one woman and three men. But their singing resounded in the high vaulted, completely majestic, centuries old church. The lone kilted piper within the Chapel evoked much. The service itself was short, just a Reading, prayers and listing of the multitude of honours bestowed on the Duke of Edinburgh, whose medals and decorations were on display beside the alter. The Archbishop of Canterbury, Justin Welby, and the Dean of Windsor, David Conner conducted the service.

To conclude, the Duke of Edinburgh had advised and laid stipulations on a simple funeral with the necessary pomp and pageantry but low key and very unostentatious. The actual funeral was even more low-key with mourners requested not to be on the streets or place flowers. The latter they did in all the residencies of the Royal Family in appreciation of a man who faithfully stood by the Queen and in his own way gave service to the nation.

Coming back to Free Sri Lanka, we seem to stress on that first word Cass inserted to the country name, even in these dire times of no crowds. And the worst is milling crowds are apparently encouraged to boost popularity of certain VVIPs by sycophants and by the preference/orders of the VVIP himself.

Consider the funeral of Minister Thondaman: crowds in Colombo and all VIPs wishing to register their presence before the body, and then the commotion at the actual cremation Up Country. Consider this year’s Sinhala New Year celebrations which were very dignified at the President’s residence but were inclusive of all traditions and a large gathering in the PM’s home, even raban playing by the Second Lady, and milling crowds outside.


Roller coaster ride of the country continues

Cass is relieved she had a topic to write on; namely that we should emulate the manner in which the much admired Duke of Edinburgh’s funeral was conducted, abiding by his stricture of it being low key and the country’s Covid restrictions. Our leaders especially must accept the saying I quoted at the beginning.

The country continues its roller coaster bumpy ride with some crying out the country is being sold to the Chinese, we will be a colony of theirs after they occupy the Port City; and others in remote areas sitting down for days on end, some near 100 days, drawing attention to the human elephant conflict. Much is touted about the Bill relating to the rules to govern the Port City.

Cassandra listens to all, and is somewhat warned and frightened, but cannot comment. However, one matter she speaks about loud and clear. The people must be told the status quo of the pandemic – daily numbers catching the infection and numbers dying. This is not for interest sake or ghoulish appetites; but to know how things are so we relax a wee bit or shut in more stringently. The Covid-19 Task Force, or the Health High Ups (not Pavithra please) should tell the country of the true situ of the pandemic as it holds the country in its grip. We want to know whether the grip is tightening or weakening. Please give us daily statistics. This newspaper announces total numbers. No help. Are we expected to jot down figures, subtract, and give ourselves daily infection and death statistics? No! It goes to prove that other matters – political slanted, ego boosting and economics – are more important than warning, containing the pandemic, and saving lives.

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Do you pump Octane 95 Petrol to your car to get better performance?



If your answer is YES, this article is for you

Dr. Saliya Jayasekara.

Senior Lecturer Department of Mechanical Engineering
University of Moratuwa

Many passenger vehicles, including three-wheelers and motorcycles are fueled by octane 95 gasoline when octane 92 gasoline (petrol) is available at a lower price. 

Otto engine (petrol engine) is an internal combustion spark ignition engine invented by a German engineer Nicolaus Otto in 1876 and used in most of the light weight vehicles including cars, three wheelers and motor bicycles. Otto engines can burn most of the hydrocarbon fuels (including hydrogen and ethanol) that can mix with air by evaporation (low boiling point). But the combustion characteristics of different hydrocarbons are not the same when burned inside an engine. If an Otto engine is designed for a particular fuel, it would not perform similarly with a fuel that has a different chemical composition.

In a well-tuned Otto engine run on gasoline for which the engine is designed, the combustion of the gasoline (petrol) / air mixture will continue smoothly from the spark plug to the piston head by igniting successive layers of the mixture as shown in Figure 1 (a).

If low grade gasolines are used, the combustion of some of the air/ fuel mixture in the cylinder does not result from propagation of the flame front initiated by the spark plug, but one or more pockets of air/fuel mixture explode (Detonate) outside the envelope of the normal combustion front as shown in Figure 1 (b). This detonation can cause severe damage to the piston and the head of the engine while deteriorating thermal performance of the engine (low efficiency)

Gasoline is a petroleum-derived product comprising a mixture of different hydrocarbons ranging from 4 to 12 carbon atoms in a carbon chain with the boiling point ranging of 30–225°C. It is predominantly a mixture of paraffins, naphthenes, aromatics and olefins. Additives and blending agents are added to improve the performance and stability of gasoline. The engine designers learned that straight-chain paraffin have a much higher tendency to detonate than do branched-chain paraffin.

The tendency of a particular gasoline to detonate is expressed by its octane number (ON). Arbitrarily, tri-methyl-pentane, C8H18 (iso-octane) is assigned an ON of 100, while the straight-chain paraffin n-heptane, C7H16 is given an ON of zero. Hence, a fuel sample with the same anti-detonation quality as that of a mixture containing 90% iso-octane and 10% n-heptane is said to have an ON of 90. Gasoline is made up of a mixture of mostly branched-chain paraffin with suitable additives to give an ON in the range 90 –100. It was also learned through experiments that the ON of a gasoline blends (e.g. gasoline and ethanol) can be calculated by using weighted average ON of each compound. Most importantly, the octane number has nothing to do with the heating value (Calorific value) or the purity of the fuel.

Engine thermodynamics show that engines with a high compression ratio offer higher thermal performance than engines with a low compression ratio. These engines having high compression ratio require high octane gasoline (for example octane 95) to avoid detonation. However, using gasoline having higher octane ratings for the engines designed for a low octane rating (for example, 92 octane) would not provide an additional benefit or loss, other than increased fuel cost.

Therefore, it is important to know the designed octane number of the engine before fueling (refer owner’s manual of the vehicle). For example: the minimum ON requirement for two and three wheelers in south Asia is 87 (The World Bank). Most of the Toyota, Honda and Nissan models including hybrid engines recommend 92 octane gasoline.

Dr. Saliya Jayasekara received the B. Sc. degree in mechanical engineering from university of Moratuwa in 2001, and the M.Sc. and PhD degrees in decentralized power generation systems from Royal institute of technology Sweden and the Melbourne University Australia in 2004 and 2013 respectively. He has well over 13 years of national and international experience in design and installation of centralised/decentralised power plants, boilers (utility/package) and heat exchangers. Currently he is serving as a senior lecture at University of Moratuwa, a visiting lecturer and fellow at Deakin University Australia.

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