News
Leftist Sri Lanka leader stuck with painful IMF deal: analysts
by Amal JAYASINGHE
Colombo (Sri Lanka)– 25 September 2024 12:30 – AFP: Sri Lanka’s new leftist leader has little room to renegotiate an IMF bailout that threw a lifeline to his bankrupt country but imposed punishing and unpopular austerity measures, analysts say.
Anura Kumara Dissanayake, 55, was a vocal critic of global lenders from the fringes of the island nation’s politics, including in the aftermath of Sri Lanka’s unprecedented economic meltdown two years ago.
He won Saturday’s presidential vote in a landslide promising to reverse steep tax hikes, raise public servant salaries and renegotiate the International Monetary Fund rescue package secured by his predecessor.
But after his inauguration two days later he appealed for international support to revive Sri Lanka’s economy, admitting he had no magic solution to its woes.
“There are certain red lines that the IMF will not agree to negotiate,” Murtaza Jafferjee of the Colombo-based economic think tank Advocata told AFP.
He said the Washington-based lender of last resort would be very unlikely to budge on core components of its $2.9 billion bailout, including a ban on printing money and revenue and spending targets agreed by the last administration.
Dissanayake’s party, the People’s Liberation Front (JVP), sports the hammer and sickle motif of the international communist movement on its logo.
The JVP was confined to the political wilderness for decades after leading rebellions in the 1970s and 1980s that left more than 80,000 people dead, before the party renounced violence.
Months of food, fuel and medicine shortages that accompanied the 2022 financial crisis and foreign debt default rallied the public behind it.
Dissanayake’s call to upend the island’s “corrupt” politics resonated with a public infuriated by chronic economic mismanagement and graft scandals in government ranks.
As the size of his victory became clear, his party moved quickly to assure markets and creditors that it would adhere to the broad strokes of the bailout deal.
“We will not tear up the IMF programme,” JVP politburo member Bimal Ratnayake said. “It is a binding document, but there is a provision to renegotiate.”
The ironic outcome of the pledge was that the same day as an avowed Marxist assumed the presidency, Colombo’s stock exchange rallied by 1.5 percent.
But by committing to maintain the rescue plan, Jafferjee said that any tweaks pushed by Dissanayake would necessarily be minor.
“On the fiscal side, there is not much adjustment that can be done,” he said.
Dissanayake’s predecessor, Ranil Wickremesinghe, was voted out of office after doubling income taxes and imposing other reviled austerity measures.
His policies ended the shortages as well as runaway inflation and returned the country to growth but left millions struggling to make ends meet.
The IMF said Wickremesinghe’s administration had made a great deal of progress in repairing the nation’s ruined finances after a $46 billion foreign debt default two years ago.

Analysts say the IMF would be very unlikely to budge on core components of its $2.9 billion bailout. Idrees MOHAMMED / AFP
But spokesperson Julie Kozack also warned ahead of the presidential poll that Sri Lanka was “not out of the woods yet”.
One of Dissanayake’s first acts of business will be to secure a parliamentary endorsement for a debt restructuring deal with international bondholders, negotiated by his predecessor at the eleventh hour and announced last week.
That will have to wait for the election of a new parliament, as Dissanayake sought to capitalise on his landslide win by calling snap polls on Tuesday, the day after he was sworn in.
Umesh Moramudali, an economics lecturer at the University of Colombo, warned that failing to secure the deal’s passage could open Sri Lanka to legal action from its creditors.
“It would be in the best interest of the country to avoid litigation with bondholders,” he told AFP.
Sri Lanka also owes billions to China and India, its two largest bilateral creditors who are both competing for influence in the island nation, which is strategically situated on global east-west sea routes.
Both nations have congratulated Dissanayake on his win and pledged to work with his administration.
Dissanayake’s ideological leanings, his campaign against an India-backed energy project and the JVP’s historical anti-India stance had led some experts to suspect his administration would lead Sri Lanka to a closer relationship with Beijing.
But he used his inauguration speech to reject “power divisions in the world” and pledged to work with all other countries for the benefit of his own.
“The new leader’s foreign policy stance will be important,” said Farwa Aamer of the Asia Society Policy Institute.
“It will be in his interest to work with India, as a regional partner, as he focuses on economic development.”
Latest News
India vs Pakistan match is a godsend for T20 World Cup hosts Sri Lanka
Almost 30 years ago today, India and Pakistan formed a combined cricket team to take on Sri Lanka ahead of the 1996 Cricket World Cup in an unprecedented moment of unity in the sport’s history.
The two age-old rivals put aside their differences and came together in an act of solidarity to support a fellow South Asian team, who faced the threat of match boycotts in a tournament they had battled hard to host.
India versus Pakistan is the most highly marketed fixture at every multination tournament – the World Cup, Asia Cup or Asian Games – whether it’s a men’s, women’s or Under-19 event.
Few sporting events globally carry the weight and anticipation of an India-Pakistan cricket match. So, when Pakistan’s government ordered its team not to face India at the ongoing T20 World Cup, the tournament was briefly pushed into a state of chaos.
It also left Sri Lanka, the designated host of the fixture, holding its collective breath.
A week of negotiations led to a dramatic late U-turn by the Pakistani government and the match will now take place as scheduled on Sunday at the R Premadasa International Cricket Stadium in Colombo.
But what if the boycott had gone ahead? The impact could have been catastrophic, not just for Pakistan, but also for the International Cricket Council (ICC), as well as Sri Lanka.
With the crisis seemingly averted, the island nation stands poised to reap the benefits in its financial landscape, diplomatic standing and community.
The tourism and hospitality industry was one of the hardest hit during Sri Lanka’s financial meltdown and this match will see an enormous influx of fans from India and Pakistan coming into the country.
Hotels in and around Colombo were fully booked out well ahead of the tournament but the industry braced itself for heavy losses after Pakistan threatened a boycott.
“There’s been a massive impact since the boycott was announced,” Sudarshana Pieris, who works in Sri Lanka’s hospitality sector, told Al Jazeera.
“All major hotels in Colombo were fully booked by Indian travel agencies well ahead of the match and once the boycott was announced, we lost almost all of those bookings,” he said.
“But after Pakistan reversed their decision, hotel room rates shot up by about 300-400 percent at five-star establishments in Colombo.”
It’s not just hotels but several other local businesses – from street vendors to high-end restaurants – who are hoping for an increased footfall and spending over the weekend.
These short trips and the experiences they offer could influence visitors to extend their stay or return to Sri Lanka on holiday, long after the game has ended, in a potential long-term benefit to the industry.
Another relatively underestimated impact of the game would be the employment opportunities it creates, albeit temporarily, in the media, event management, security and transportation industries.
Asanka Hadirampela, a freelance journalist and broadcaster currently working as a Sinhala language commentator for the World Cup, recognises the marquee match as a great opportunity from a personal standpoint.
“This is my first World Cup as a broadcaster,” Hadirampela said.
“The India-Pakistan fixture is the biggest and most-watched game of the tournament. So to get to work on such a match is exciting and I consider it a special achievement.”
The lines are always blurred between sport and politics in South Asia.
So while the financial gains are expected to be significant, the fixture’s impact on the region’s geopolitical environment cannot go amiss.
Pakistan’s boycott, too, was explicitly political, as confirmed by the country’s Prime Minister Shehbaz Sharif when he said that they were offering support to Bangladesh after the Tigers were kicked out of the tournament by the ICC.
The reversal of Pakistan’s decision, which they said came after requests to reconsider the boycott by several regional “friends”, was steeped in politics, too.
Sri Lanka’s President Anura Kumara Dissanayake reportedly had a phone conversation with PM Sharif, urging his government to rethink their decision to boycott the game as the successful staging of this encounter would not only position Sri Lanka as a capable host of global sporting events but also reinforce its standing as a neutral mediator in a region fraught with geopolitical complexities.
Sri Lanka and Pakistan have always maintained strong diplomatic relations, which have extended to the cricket field as well.
Sri Lanka were one of the first teams to travel to Pakistan following their 10-year ostracisation from international cricket, which came as a result of a terrorist attack targeting the Sri Lankan team in March 2009.
When Al Jazeera reached out to Sri Lanka Cricket (SLC), its vice president Ravin Wickramaratne confirmed that SLC did, indeed, reach out to the Pakistan Cricket Board (PCB) after the boycott was announced.
“We asked them to reconsider the decision,” Wickramaratne said.
“It [boycott] would have impacted Sri Lanka economically, whether directly or indirectly.
“We have always had a good relationship with the PCB and we have always supported them, so we’re happy with their decision.”
A little over 24 hours ahead of the match in Colombo, there is a sense of palpable excitement and a growing buzz around the fixture as it returns from the brink of cancellation.
As of Saturday morning, 28,000 tickets had been sold for the game but local organisers expect a capacity crowd of 40,000 to make it into the stands.
Come Sunday, thousands more will line the streets in and around Maligawatte, the bustling Colombo suburb that houses the famous Premadasa Stadium.

Business
“We Are Building a Stable, Transparent and Resilient Sri Lanka Ready for Sustainable Investment Partnerships” – PM
Prime Minister Dr. Harini Amarasuriya addressed members of the Chief Executives Organization (CEO) during a session held on Thursday [3 February 2026] at the Shangri-La Hotel, Colombo, as part of CEO’s Pearl of the Indian Ocean: Sri Lanka programme.
The Chief Executives Organization is a global network of business leaders representing diverse industries across more than 60 countries. The visiting delegation comprised leading entrepreneurs and executives exploring Sri Lanka’s economic prospects, investment climate, and development trajectory.
Addressing the gathering, the Prime Minister emphasized that Sri Lanka’s reform agenda is anchored in structural transformation, transparency, and inclusive growth.
“We are committed not only to ensuring equitable access to education, but equitable access to quality education. Our reforms are designed to create flexible pathways for young people beyond general education and to build a skilled and adaptable workforce for the future.”
She highlighted that the Government is undertaking a fundamental pedagogical shift towards a more student-focused, less examination-driven system as part of a broader national transformation.
Reflecting on Sri Lanka’s recent political transition, the Prime Minister stated:
“The people gave us a mandate to restore accountability, strengthen democratic governance, and ensure that opportunity is not determined by patronage or privilege, but by fairness and merit. Sri Lanka is stabilizing. We have recorded positive growth, restored confidence in key sectors, and are committed to sustaining this momentum. But our objective is not short-term recovery it is long-term resilience.”
Addressing governance reforms aimed at improving the investment climate, she said:
“We are aligning our legislative and regulatory frameworks with international standards to provide predictability, investor protection, and institutional transparency. Sustainable investment requires trust, and trust requires reform.”
Turning to the recent impact of Cyclone Ditwa, which affected all 25 districts of the country, the Prime Minister underscored the urgency of climate resilience.
“Climate change is not a distant threat. It is a lived reality for our people. We are rebuilding not simply to recover, but to build resilience, strengthen disaster mitigation systems, and protect vulnerable communities.”
Inviting CEO members to consider Sri Lanka as a strategic partner in the Indo-Pacific region, she highlighted opportunities in value-added mineral exports, logistics and shipping, agro-processing, renewable energy, pharmaceuticals, and innovation-driven sectors.
“We are not looking for speculative gains. We are seeking long-term partners who share our commitment to transparency, sustainability, and inclusive development.”
She further emphasized collaboration in education, research, vocational training, and innovation as essential pillars for sustained economic growth.
Concluding her address, the Prime Minister expressed appreciation to the Chief Executives Organization for selecting Sri Lanka as part of its 2026 programme and reaffirmed the Government’s readiness to engage constructively with responsible global investors.
The event was attended by the Governor of the Western Province, Hanif Yusoof, and other distinguished guests.


[Prime Minister’s Media Division]
News
Prez AKD congratulates BNP’s Tarique Rahman on B’desh election win
President Anura Kumara Dissanayake has extended his congratulations to the Bangladesh Nationalist Party (BNP) and its leader, Tarique Rahman, following their landslide victory in Bangladesh’s parliamentary elections.
“Best wishes to the people of Bangladesh for reaffirming their faith in democracy, and congratulations to Mr. Tarique Rahman on leading the BNP in these elections. The results reflect the trust placed in him. I look forward to strengthening ties between our two nations,” President Dissanayake said, in a post on ‘X’.
The Bangladesh Nationalist Party won a landslide parliamentary election on Friday, securing a resounding mandate in a pivotal vote that is expected to restore political stability in the South Asian nation.
The parliamentary election held on Thursday was Bangladesh’s first vote since the 2024 Gen Z-driven uprising that toppled long-time premier Sheikh Hasina.
Opinion polls had given BNP an edge, and the party lived up to the forecasts, with the coalition it dominates winning 209 seats to secure an overwhelming two-thirds majority in the 300-member Jatiya Sangsad, or House of the Nation, Jamuna TV showed.
Soon after it won a majority in the overnight vote-count, the party thanked and congratulated the people and called for special prayers on Friday for the welfare of the country and its people.
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