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Only 27% of funds allocated to SPC from Indian creditline spent: Ex-deputy Treasury Chief

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Former Deputy Secretary to the Treasury R. M. P. Ratnayake told the Colombo Permanent High Court Trial-at-Bar on Friday that under an India–Sri Lanka loan agreement, funds allocated for the purchase of medicines must be used strictly for that purpose, and any issues should be addressed through a remedial committee.

Ratnayake made these submissions during the continuation of evidence in the case filed by the Attorney General against former Health Minister Keheliya Rambukwella and other accused. The case pertains to the procurement of substandard human immunoglobulin. The matter was heard before a Permanent High Court Trial-at-Bar, comprising Justices Priyantha Liyanage, Viraj Weerasuriya, and Thilakaratne Bandara.  He appeared as the 182nd witness in the case related to irregularities in government purchases of medicines under the Indian Loan Proposal Scheme. He told the court that he did not have full knowledge of all conditions of the agreement and could not recall having seen a copy of the full document.

The loan, originally approved at USD 1 billion during the tenure of then President and Finance Minister Ranil Wickremesinghe, was granted to ease foreign exchange shortages and support essential imports. Ratnayake said the funds were not a grant and must be repaid after four years with interest.

During cross-examination, he admitted that only about 27% of the funds allocated to the State Pharmaceuticals Corporation had been spent, while nearly 100% of the private sector allocation was used as intended. He said he had informed relevant authorities, including the chair of the Pharmaceutical Procurement Committee, of the shortfall and delays.

Ratnayake said the government had intended to maximise the loan’s benefits and address delays, and that he had acted on behalf of the Treasury Secretary in signing conditions to extend the loan period. He also confirmed that public hospitals and healthcare services continued to operate free of charge despite the funding issues.

The witness acknowledged that the higher dollar exchange rate at the time had contributed to rising prices and inflation. He added that any problems arising from the Indian loan scheme were to be handled by a designated remedial committee, as stipulated in the agreement.

The court adjourned the examination of the witness until 10 am today (9).

by A. J. A. Abeynayake



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Maldives Coast Guard Ship Huravee departs island

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The Maldives Coast Guard Ship Huravee which arrived in Sri Lanka for replenishment purposes, departed the island on 04 Mar 26.

In accordance with naval tradition, the Sri Lanka Navy extended a customary farewell to the departing ship at the Port of Colombo

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‘IRIS Dena was Indian Navy guest, hit without warning’, Iran warns US of bitter regret

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A day after a US submarine sunk an Iranian Navy warship off the coast of Sri Lanka, the Foreign Minister of Iran, Sayed Abbas Araghchi, has warned that the US would “pay bitterly” for targeting a ship in international waters, The Tribune has reported.

Araghchi posted on social media platform X on Thursday saying, “The US has perpetrated an atrocity at sea, 2,000 miles away from Iran’s shores.”

The frigate IRIS Dena, a guest of India’s Navy carrying almost 130 sailors, was struck in international waters without warning, said the Iran Foreign Minister, adding, “Mark my words: The US will come to bitterly regret the precedent it has set.”

US Secretary of War, Pete Hegseth, on Wednesday confirmed that a US submarine fired a torpedo and sank the Iranian Navy vessel IRIS Dena west of Sri Lanka.

In a way, the Iran and US-Israel conflict has reached close to the Indian coast. The strike today at sea was almost 4,000 kms away from Iran, significantly expanding the radius of war. Already, fearing Iranian missile strikes, several US warships have moved eastward towards India.

These ships are in international waters. India has denied that any US Navy assets were using Indian ports. The Iranian ship, hit on Wednesday, was returning after participating in the international fleet review and exercise Milan hosted by India at Visakhapatnam.

The Iranian ship went down with almost 130 sailors on board missing. The Sri Lankan Navy, acting on a distress call, rescued 32 of the Iranian sailors. Hegseth confirmed the act by the US forces, saying the ship was hit in the Indian Ocean, stating, “an Iranian warship that thought it was safe in international waters. .. Instead, it was sunk by a torpedo”.

Hegseth did not name the Iranian ship that was attacked. But earlier, the Sri Lankan Navy reported the distress call from IRIS Dena when it was some 40 kms west of Galle, located on the south-western part of the island country. On February 16, the Iranian ship had sailed into the port of Visakhapatnam, where seventy-four nations participated.

Warships from Australia, Japan, South Korea, Russia, and dozens of others were anchored alongside the now-sunk Iranian vessel. Iran’s Navy Commander, Rear Admiral Shahram Irani, held talks with India’s Chief of Naval Staff on strengthening maritime security cooperation.

The theme was “United through Oceans.” Notably, the US Navy was supposed to send the guided-missile destroyer USS Pinckney to the exercise Milan; however, the ship was diverted to Singapore on February 15. The US did not field its warship in Milan, which had ships from Russia and Iran.

The exercise ended on February 25. Three days later, on February 28, the United States and Israel launched Operation Epic Fury. The IRIS Dena was transiting home. This morning at 5:08 a.m. local time, the IRIS Dena issued a distress call. Sri Lanka’s Foreign Minister, Vijitha Herath, informed parliament that two navy vessels and an aircraft were deployed. Thirty crew members were rescued and admitted to Karapitiya Hospital in Galle.

The Straits Times reported 32 critically wounded survivors. Reuters reported 101 missing and 78 wounded. The Sri Lankan Navy spokesman said the operation was conducted in line with the International Convention on Maritime Search and Rescue.

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Risk of power cuts due to use of low-quality coal,PUCSL warns

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The Public Utilities Commission of Sri Lanka (PUCSL) has warned of a possible risk of power cuts due to the use of inferior quality coal affecting generation capacity at the Lakvijaya Power Plant, according to a recent commission report.

The commission said the risk to the continuous electricity supply was assessed based on the peak demand forecast submitted by the Ceylon Electricity Board (CEB) for 2026.

According to the report, the analysis assumed that hydropower plants could contribute up to 1,300 MW to meet the night peak demand, while the Lakvijaya Power Plant (LVPS) would be able to contribute only up to 690 MW due to a capacity shortfall, assuming a 40 MW generation capacity reduction from each unit.

The PUCSL said the assessment was carried out taking into account the planned maintenance schedule submitted by the CEB. Under the schedule, Unit 1 of the Lakvijaya plant is due to undergo maintenance checks and repairs in June for a period of 25 days, while Unit 2 is scheduled for maintenance in July for another 25 days.

The report also noted that the 270 MW West Coast Power Plant is scheduled to undergo maintenance in April for 10 days, while the 150 MW Kelanitissa Combined Cycle Power Plant (KCCP 2) is expected to undergo maintenance during May, June and July.

Under normal conditions, the report said, there is a potential risk of a generation capacity shortage if electricity demand reaches 3,030 MW in April, 3,070 MW in June and 3,000 MW in July.

The highest recorded night peak demand so far in 2026 was 2,949 MW on February 25.

The PUCSL further warned that if one coal unit or any major power plant becomes unavailable from the existing generation mix, there would be a significant risk of a generation capacity shortage to meet the night peak demand, particularly during April, June and July.

Energy sector analysts said the use of substandard coal could further aggravate operational challenges at the Norochcholai plant, potentially affecting generation efficiency and reliability if corrective measures are not taken promptly.

By Ifham Nizam

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