Opinion
Reducing Trade Deficit
By DR. C. S. WEERARATNA
A trade deficit typically occurs when a country does not produce enough goods for its citizens. When production cannot meet demand as in Sri Lanka, there is a need to import thereby widening the trade deficit. A persistent trade deficit is detrimental to a country’s economy because it is financed with debt. The trade deficit in Sri Lanka had been persistent over a long period of time (Table 1)
Persistent Trade Deficit tends to have a negative impact on employment, growth, and value of the currency. If we are to reduce the trade deficit it is essential that exports are increased and imports are reduced as much as possible.
Increase export earnings
The dire need to increase our export earnings to meet the severe financial crisis we are facing today has been emphasised by many. As indicated in Table 1, exports during the last six years (this is the case even in earlier years) have not increased by any substantial amount in spite of an Export Development Board and numerous other related authorities. Increasing exports is of paramount importance to improve our economy. It is because of the importance of increasing exports that the government brought a National Export Strategy. But what are we going to export?
Plantation Sector
Our major exports are plantation crops, tea, rubber and coconut. Around 800,000 ha are cultivated with plantation crops. However, as indicated in Table 2, the production of these major export crops does not show any substantial increase during the last five years.
As shown in Table 2, tea production has been fluctuating around 275 million kg per year during the last few years. Annual rubber production shows a tendency to decrease. Coconut production has fluctuated around 300 million nuts per year. This appalling situation in the plantation sector can be attributed to many factors, but the Ministry of Plantation Industries and the relevant authorities appear to have not taken effective strategies to remedy this situation. If the productivity of this sector is raised, it would be possible to increase foreign exchange earnings thereby reducing the trade deficit. It is necessary that the relevant authorities take appropriate action to increase the production of the plantation crops.
A large number of crops other than tea, rubber and coconut cultivated in Sri Lanka have a high potential as export crops. There are 24 agro-ecological zones, each characterised by specific climate and soil. This makes it possible to cultivate different types of crops. Among these are spice crops such as cinnamon, pepper and nutmeg, tuberous crops, horticultural and floricultural crops, medicinal herbs etc. which have a considerable export potential. In 2020, spice crops earned around US $ 400 million. There are many organizations such as the Ministries of Agriculture, Industry and Commerce, Export Development Board, Industrial Development Board etc. but, there appears to be no proper plan to increase the production of these crops.
Out of the 6.5 million hectares of land, around 2.0 million hectares are in the Wet Zone. About 75% of it is cultivated and most of this land is of low-productivity mainly due to soil degradation. In the Dry Zone, out of the 4.5 million hectares only about 2 million hectares are in productive use. Thus, there is a large extent of potentially cultivable land in the Dry Zone. Most of the soils in the Dry Zone are relatively more fertile than those in the Wet Zone. Non-availability of adequate rainfall during the Yala season is one of the limiting factors of crop production in the Dry Zone. However, better water management practices would reduce this limitation. Also, various major irrigation projects such as Mahaveli, Kirindi Oya, Muthukandiya and Inginimitiya provide irrigation to about 200,000 hectares in the Dry Zone. The recently inaugurated Moraghakanda project is expected to provide irrigation water to nearly 80,000 ha. The numerous minor irrigation projects too would increase the irrigable area in the Dry Zone. Thus, there is a considerable potential to increase the level of crop production in Sri Lanka, export of which would enable to increase exports and reduce trade deficit.
Agro-Industries:
Promoting industries based on agriculture (agro-industries) will have a considerable positive impact on increasing export earnings thereby reducing trade deficit. There is an urgent need to develop agro-industries in Sri Lanka, which will have a tremendous positive impact on employment and rural poverty. A large number of crops cultivated in Sri Lanka, including rice, have a considerable potential in various agro-industries. However, only rubber, coconut and a few fruit crops are used in industries. Crops such as cassava, horticultural and floricultural crops, medicinal herbs, cane, bamboo, sunflower, castor, ayurvedic herbs such as katuwelbatu , etc. have a considerable potential as export crops, but are not cultivated to any appreciable extent for want of better and improved varieties, technological know-how, relevant market information etc. Development of agro-industries will also increase export income and will have a tremendous positive impact on the economy of the country, and also provide employment opportunities among rural people. Private sector can be involved in such projects for which appropriate technical assistance needs to be given by the relevant public organisations. However, there appears to be no proper long-term plan to develop agro-industries, except for some ad-hoc projects. The Ministries of Industries and Agriculture should implement an effective Agro-Industrial Development Programme, in collaboration with the private sector, which undoubtedly would improve export income, employment opportunities and incomes in the rural areas.

Small and Medium-Term Industries
Products of crop based Small and Medium Enterprises (SMEs), have a high export potential and play a very important role in economic development of Sri Lanka because they have the capacity to achieve rapid economic growth, while generating a considerable extent of employment opportunities. Promotion of SMEs would result in increasing industrial output of the country, leading to more exports. However, not much emphasis appears to have been placed on improving SMEs, except providing loans from banks. A main factor which limits the SME sector is inadequate raw materials.
Increasing cost of Imports
While some talk about strategies to increase exports, there appears to be not much emphasis on reducing crop-based imports, which will have an appreciable impact on reducing trade deficit. Our import costs are likely to increase due to escalation of freight costs as a result of Houthi attacks in the red sea. This will widen our trade deficit.
Most of the food imported such as sugar, milk food, lentils, onion, maize, etc., which involves around US$ 2,000 million annually, can be locally produced, thereby reducing expenditure on food imports. For example, nearly 16% of food imports is spent on importing sugar, most of which can be locally produced. Sugar production in the country has not increased by any appreciable amounts during the present decade in spite of three sugar companies, Pelwatta, Sevanagala and Hingurana and the Sugarcane Research Institute. Kantale sugar factory remains closed over a long period, while a plan to cultivate sugarcane in Bibile remains shelved. There are crops such as coconut, kitul and palmyrah which can be used to manufacture sugar-based substances such as jaggery and treacle, but there appears to be no effective strategy to promote the production of these crops.
With regard to milk production we have around 1 million cattle consisting of mostly indigenous breeds. Their productivity is low (1-3 litres/day) mainly due to the poor nature of the breeds and inadequate low-quality feed supply. As a result, annually we import nearly 300 million US dollars worth of milk and other dairy products. There appears to be no effective plan to increase local milk production by improving the local breeds and supply of cattle feed. The dairy industry has a potential to contribute considerably to Sri Lanka’s economic development. But, instead of implementing an effective viable plan to develop the dairy industry in the country, the government imported around 20,000 cattle from New Zealand and Australia involving USD 73 million. Importing cattle to improve the dairy industry in the country is a futile action, as importing cattle alone is not going to increase milk production in the long run, unless there is an effective programme to upgrade local cattle breeds, promote cultivation of improved pasture grasses which can be grown under coconut and provide better veterinary practices.
Nearly 300 million US dollars worth of rice (a carbohydrate) is imported annually when there are many tuberous crops such as innala, sweet potato, yams which can replace a part of the rice we import thereby reducing expenditure on imports.
Eppawala Apatite (EA), which was discovered a few decades ago still remains partly underutilized. EA can be used to manufacture phosphate fertilisers. But still we grind the rock and use the ground apatite as a P fertiliser, while spending millions to import Single Superphosphate and Triple Super Phosphate, which can be manufactured from EA.
The expenditure on subsidiary crops such as chillies, green gram, ground nut, potato etc, is millions of US dollars. The average per hectare yields and the extent of these crops have not increased by any appreciable amount during the last decade. In fact, chili production has decreased during the last few years. In the recent past, a former Minister of Agricultural Development Chamal Rajapaksa, appointed an Advisory Panel to make proposals to develop the agricultural sector in the country so that there is a quantitative and qualitative increase in crop production at a lower cost with no damage to the environment. During the last few years numerous programmes such as “AMA’, Waga Sangramaya and Govi Sevana” were implemented. All these activities/programmes, appear to have not made any appreciable positive impact on the agricultural sector of the country indicated by increasing expenditure on food.
Science and Technology.
Effective use of Science and Technology (S&T) would tend to reduce imports and increase exports. During the last two decades, effective use of Science and Technology (S&T) enabled most of the South and South East Asian countries to develop substantially. However, in Sri Lanka, in spite of a number of scientific organisations such as the National Science Foundation, National Institute of Fundamental Studies, National Research Council of Sri Lanka, National Science and Technology Commission, which use a considerable amount of scarce financial resources, S&T has been used to a relatively very little extent to decrease imports which will tend to reduce trade deficit thereby improving the economy of the country.
A primary objective of use of S&T in a developing country such as Sri Lanka must be to conduct appropriate studies on the critical issues and advise the authorities on relevant action to be taken. Science and Technology need to be used to utilise locally available resources. Conducting research alone will not lead to economic development, unless the technologies developed by research are commercialised. Organisations such as the Industrial Development Board, the Board of Investments etc. need to coordinate with the relevant scientific organisations to attract investments on commercialisation of proven technologies. Vidatha Centers have been established in many DS Divisions to commercialise S&T. Perhaps the Ministry of Technology and Research may indicate to what extent these Vidatha Centers have been effective in commercialising S&T.
In Sri Lanka, during the last two decades, perhaps a few hundreds of research studies, involving billions of rupees worth of scarce resources, have been conducted. Findings of these research projects were presented at numerous conferences, seminars etc. It is important that we utilise these research findings to find solutions to some of the pressing problems of the country. But there appears to be no effective system to achieve this. Instead, the authorities are concerned in conducting more and more seminars and symposia without any plan to effectively utilise the findings/conclusions.
The authorities concerned should discuss these issues and take appropriate action. There has been rhetoric on economic development during the last few years. It is meaningful and effective actions that are necessary.
Opinion
War with Iran and unravelling of the global order – II
Broader Strategic Consequences
One of the most significant strategic consequences of the war is the accelerated erosion of U.S. political and moral hegemony. This is not a sudden phenomenon precipitated solely by the present conflict; rather, the war has served to illuminate an already evolving global reality—that the era of uncontested U.S. dominance is in decline. The resurgence of Donald Trump and the reassertion of his “America First” doctrine reflect deep-seated domestic economic and political challenges within the United States. These internal pressures have, in turn, shaped a more unilateral and inward-looking foreign policy posture, further constraining Washington’s capacity to exercise global leadership.
Moreover, the conduct of the war has significantly undermined the political and moral authority of the United States. Perceived violations of international humanitarian law, coupled with the selective application of international norms, have weakened the credibility of U.S. advocacy for a “rules-based international order.” Such inconsistencies have reinforced perceptions of double standards, particularly among states in the Global South. Skepticism toward Western normative leadership is expected to deepen, contributing to the gradual fragmentation of the international system. In this broader context, the ongoing crisis can be seen as symptomatic of a more fundamental transformation: the progressive waning of a global order historically anchored in U.S. hegemony and the emergence of a more contested and pluralistic international landscape.
The regional implications of the crisis are likely to be profound, particularly given the centrality of the Persian Gulf to the global political economy. As a critical hub of energy production and maritime trade, instability in this region carries systemic consequences that extend far beyond its immediate geography. Whatever may be the outcome, whether through the decisive weakening of Iran or the inability of external powers to dismantle its leadership and strategic capabilities, the post-conflict regional order will differ markedly from its pre-war configuration. In this evolving context, traditional power hierarchies, alliance structures, and deterrence dynamics are likely to undergo significant recalibration.
A key lesson underscored by the war is the deep interconnectivity of the contemporary global economic order. In an era of highly integrated production networks and supply chains, disruptions in a single strategic node can generate cascading effects across the global system. As such, regional conflicts increasingly assume global significance. The structural realities of globalisation make it difficult to contain economic and strategic shocks within regional boundaries, as impacts rapidly transmit through trade, energy, and financial networks. In this context, peace and stability are no longer purely regional concerns but global public goods, essential to the functioning and resilience of the international system
The conflict highlights the emergence of a new paradigm of warfare shaped by the integration of artificial intelligence, cyber capabilities, and unmanned systems. The extensive use of unmanned combat aerial vehicles (UCAVs)—a trend previously demonstrated in the Russia–Ukraine War—has been further validated in this theatre. However, unlike the Ukraine conflict, where Western powers have provided sustained military, technological, and financial backing, the present confrontation reflects a more direct asymmetry between a dominant global hegemon and a Global South state. Iran’s deployment of drone swarms and AI-enabled targeting systems illustrates that key elements of Fourth Industrial Revolution (4IR) warfare are no longer confined to technologically advanced Western states. These capabilities are increasingly accessible to Global South actors, lowering barriers to entry and significantly enhancing their capacity to wage effective asymmetric warfare. In this evolving context, technological diffusion is reshaping the strategic landscape, challenging traditional military hierarchies and altering the balance between conventional superiority and innovative, cost-effective combat strategies.
The war further exposed and deepened the weakening of global governance institutions, particularly the United Nations. Many of these institutions were established in 1945, reflecting the balance of power and geopolitical realities of the immediate post-Second World War era. However, the profound transformations in the international system since then have rendered aspects of this institutional architecture increasingly outdated and less effective.
The war has underscored the urgent need for comprehensive international governance reforms to ensure that international institutions remain credible, representative, and capable of addressing contemporary security challenges. The perceived ineffectiveness of UN human rights mechanisms in responding to violations of international humanitarian law—particularly in contexts such as the West Bank and the Gaza Strip, and more recently in Iran—has amplified calls for institutional renewal or the development of alternative frameworks for maintaining international peace and security. Moreover, the selective enforcement of international law and the persistent paralysis in conflict resolution mechanisms risk accelerating the fragmentation of global norms. If sustained, this trajectory would signal not merely the weakening but the possible demise of the so-called liberal international order, accelerating the erosion of both the legitimacy and the effective authority of existing multilateral institutions, and deepening the crisis of global governance.
Historically, major wars have often served as harbingers of new eras in international politics, marking painful yet decisive transitions from one order to another. Periods of systemic decline are typically accompanied by instability, uncertainty, and profound disruption; yet, it is through such crises that the contours of an emerging order begin to take shape. The present conflict appears to reflect such a moment of transition, where the strains within the existing global system are becoming increasingly visible.
Notably, key European powers are exhibiting a gradual shift away from exclusive reliance on the U.S. security umbrella, seeking instead a more autonomous and assertive role in global affairs. At the same time, the war is likely to create strategic space for China to expand its influence. As the United States becomes more deeply entangled militarily and politically, China may consolidate its position as a stabilising economic actor and an alternative strategic partner. This could be reflected in intensified energy diplomacy, expanded infrastructure investments, and a more proactive role in regional conflict management, advancing Beijing’s long-term objective of reshaping global governance structures.
However, this transition does not imply a simple replacement of Pax Americana with Pax Sinica. Rather, the emerging global order is likely to be more diffuse, pluralistic, and multilateral in character. In this sense, the ongoing transformation aligns with broader narratives of an “Asian Century,” in which power is redistributed across multiple centers rather than concentrated in a single hegemon. The war, therefore, may ultimately be understood not merely as a geopolitical crisis, but as a defining inflection point in the reconfiguration of the global order.
Conclusion: A New Era on the Horizon
History shows that major wars often signal the birth of new eras—painful, disruptive, yet transformative. The present conflict is no exception. It has exposed the vulnerabilities of the existing world order, challenged U.S. dominance, and revealed the limits of established global governance.
European powers are beginning to chart a more independent course, reducing reliance on the U.S. security umbrella, while China is poised to expand its influence as an economic stabiliser and strategic partner. Through energy diplomacy, infrastructure investments, and active engagement in regional conflicts, Beijing is quietly shaping the contours of a more multipolar world. Yet this is not the rise of Pax Sinica replacing Pax Americana. The emerging order is likely to be multilateral, fluid, and competitive—a world in which multiple powers, old and new, share the stage. The war, in all its turbulence, may therefore mark the dawn of a genuinely new global era, one where uncertainty coexists with opportunity, and where the next chapter of international politics is being written before our eyes.
by Gamini Keerawella
(First part of this article appeared yesterday (08 April)
Opinion
University admission crisis: Academics must lead the way
130,000 students are left out each year—academics hold the key
Each year, Sri Lanka’s G.C.E. Advanced Level examination produces a wave of hope—this year, nearly 175,000 students qualified for university entrance. Yet only 45,000 will be admitted to state universities. That leaves more than 130,000 young people stranded—qualified, ambitious, but excluded. This is not just a statistic; it is a national crisis. And while policymakers debate infrastructure and funding, the country’s academics must step forward as catalysts of change.
Beyond the Numbers: A National Responsibility
Education is the backbone of Sri Lanka’s development. Denying access to tens of thousands of qualified students risks wasting talent, fueling inequality, and undermining national progress. The gap is not simply about seats in lecture halls—it is about the future of a generation. Academics, as custodians of knowledge, cannot remain passive observers. They must reimagine the delivery of higher education to ensure opportunity is not a privilege for the few.
Expanding Pathways, Not Just Campuses
The traditional model of four-year degrees in brick-and-mortar universities cannot absorb the demand. Academics can design short-term diplomas and certificate programmes that provide immediate access to learning. These programmes, focused on employable skills, would allow thousands to continue their education while easing pressure on degree programmes. Equally important is the digital transformation of education. Online and blended learning modules can extend access to rural students, breaking the monopoly of physical campuses. With academic leadership, Sri Lanka can build a reliable system of credit transfers, enabling students to begin their studies at affiliated institutions and later transfer to state universities.
Partnerships That Protect Quality
Private universities and vocational institutes already absorb many students who miss out on state admissions. But concerns about quality and recognition persist. Academics can bridge this divide by providing quality assurance and standardised curricula, supervising joint degree programmes, and expanding the Open University system. These partnerships would ensure that students outside the state system receive affordable, credible, and internationally recognised education.
Research and Advocacy: Shaping Policy
Academics are not only teachers—they are researchers and thought leaders. By conducting labour market studies, they can align higher education expansion with employability. Evidence-based recommendations to the University Grants Commission (UGC) can guide strategic intake increases, regional university expansion, and government investment in digital infrastructure. In this way, academics can ensure reforms are not reactive, but visionary.
Industry Engagement: Learning Beyond the Classroom
Sri Lanka’s universities must become entrepreneurship hubs and innovation labs. Academics can design programmes that connect students directly with industries, offering internship-based learning and applied research opportunities. This approach reduces reliance on classroom capacity while equipping students with practical skills. It also reframes education as a partnership between universities and the economy, rather than a closed system.
Making the Most of What We Have
Even within existing constraints, academics can expand capacity. Training junior lecturers and adjunct faculty, sharing facilities across universities, and building international collaborations for joint programmes and scholarships are practical steps. These measures maximise resources while opening new avenues for students.
A Call to Action
Sri Lanka’s university admission crisis is not just about numbers—it is about fairness, opportunity, and national development. Academics must lead the way in transforming exclusion into empowerment. By expanding pathways, strengthening partnerships, advocating for policy reform, engaging with industry, and optimizing resources, they can ensure that qualified students are not left behind.
“Education for all, not just the fortunate few.”
Dr. Arosh Bandula (Ph.D. Nottingham), Senior Lecturer, Department of Agricultural Economics & Agribusiness, Faculty of Agriculture, University of Ruhuna
by Dr. Arosh Bandula
Opinion
Post-Easter Sri Lanka: Between memory, narrative, and National security
As Sri Lanka approaches the seventh commemoration of the Easter Sunday attacks, the national mood is once again marked by grief, reflection, and an enduring sense of incompleteness. Nearly seven years later, the tragedy continues to cast a long shadow not only over the victims and their families, but over the institutions and narratives that have since emerged.
Commemoration, however, must go beyond ritual. It must be anchored in clarity, accountability, and restraint. What is increasingly evident in the post-Easter landscape is not merely a search for truth, but a contest over how that truth is framed, interpreted, and presented to the public.
In recent times, public discourse has been shaped by book launches, panel discussions, and media interventions that claim to offer new insights into the attacks. While such contributions are not inherently problematic, the manner in which certain narratives are advanced raises legitimate concerns. The selective disclosure of information particularly when it touches on intelligence operations demands careful scrutiny.
Sri Lanka’s legal and institutional framework is clear on the sensitivity of such matters. The Official Secrets Act (No. 32 of 1955) places strict obligations on the handling of information related to national security. Similarly, the Police Ordinance and internal administrative regulations governing intelligence units emphasize confidentiality, chain of command, and the responsible use of information. These are not mere formalities; they exist to safeguard both operational integrity and national interest.
When individual particularly those with prior access to intelligence structures enter the public domain with claims that are not subject to verification, it raises critical questions. Are these disclosures contributing to justice and accountability, or are they inadvertently compromising institutional credibility and future operational capacity?
The challenge lies in distinguishing between constructive transparency and selective exposure.
The Presidential Commission of Inquiry into the Easter Sunday Attacks provided one of the most comprehensive official examinations of the attacks. Its findings highlighted a complex web of failures: lapses in intelligence sharing, breakdowns in inter-agency coordination, and serious deficiencies in political oversight. Importantly, it underscored that the attacks were not the result of a single point of failure, but a systemic collapse across multiple levels of governance.
Yet, despite the existence of such detailed institutional findings, public discourse often gravitates toward simplified narratives. There is a tendency to identify singular “masterminds” or to attribute responsibility in ways that align with prevailing political or ideological positions. While such narratives may be compelling, they risk obscuring the deeper structural issues that enabled the attacks to occur.
Equally significant is the broader socio-political context in which these narratives are unfolding. Sri Lanka today remains a society marked by fragile intercommunal relations. The aftermath of the Easter attacks saw heightened suspicion, polarisation, and, in some instances, collective blame directed at entire communities. Although there have been efforts toward reconciliation, these fault lines have not entirely disappeared.
In this environment, the language and tone of public discourse carry immense weight. The framing of terrorism whether as a localized phenomenon or as part of a broader ideological construct must be handled with precision and responsibility. Overgeneralization or the uncritical use of labels can have far-reaching consequences, including the marginalization of communities and the erosion of social cohesion.
At the same time, it is essential to acknowledge that the global discourse on terrorism is itself contested. Competing narratives, geopolitical interests, and selective historiography often shape how events are interpreted. For Sri Lanka, the challenge is to avoid becoming a passive recipient of external frameworks that may not fully reflect its own realities.
A professional and unbiased approach requires a commitment to evidence-based analysis. This includes:
· Engaging with primary sources, including official reports and judicial findings
·
· Cross-referencing claims with verifiable data
·
· Recognizing the limits of publicly available information, particularly in intelligence matters

It also requires intellectual discipline the willingness to question assumptions, to resist convenient conclusions, and to remain open to complexity.
The role of former officials and subject-matter experts in this discourse is particularly important. Their experience can provide valuable insights, but it also carries a responsibility. Public interventions must be guided by professional ethics, respect for institutional boundaries, and an awareness of the potential impact on national security.
There is a fine balance to be maintained. On one hand, democratic societies require transparency and accountability. On the other, the premature or uncontextualized release of sensitive information can undermine the very systems that are meant to protect the public.
As Sri Lanka reflects on the events of April 2019, it must resist the temptation to reduce a national tragedy into competing narratives or political instruments. The pursuit of truth must be methodical, inclusive, and grounded in law.
Easter is not only a moment of remembrance. It is a test of institutional maturity and societal resilience.
The real question is not whether new narratives will emerge they inevitably will. The question is whether Sri Lanka has the capacity to engage with them critically, responsibly, and in a manner that strengthens, rather than weakens, the foundations of its national security and social harmony.
In the end, justice is not served by noise or conjecture. It is served by patience, rigor, and an unwavering commitment to truth.
Mahil Dole is a former senior law enforcement officer and national security analyst, with over four decades of experience in policing and intelligence, including serving as Head of Counter-Intelligence at the State Intelligence Service of Sri Lanka and a graduate of the Asia Pacific Center for Security Studies in Hawai, USA.
by Mahil Dole
Former Senior Law Enforcement Officer National Security Analyst; Former Head of Counter-Intelligence, State Intelligence Service)
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