Features
Sarath Silva googly gives CBK year less than expected, Helping Hambantota
Trips to Washington for IMF and World Bank meetings, bargain book sales
We were in the beginning of the year 2005 and the next Presidential election was coming ever closer. CBK had taken Chief Justice Sarath Silva’s advice and had taken oaths as President for the second time soon after the assassination attempt in 2001 in the belief that the balance period of her first term would be added to the tail end of her current tenure. Imagine her consternation when it was held that her second term ended exactly five years after her second oath taking.
It was a double blow in that her faith in Sarath Silva was shattered and her plans to undertake a year of reforms and groom a successor were now stymied. Sarath’s decision was tailor-made for his friend Mahinda Rajapaksa for if CBK had another year she may not have selected him to be the standard bearer of the PA in the forthcoming Presidential election. At this stage with Lakshman Kadirgamar’s demise, the odds on favourite was Anura Bandaranaike. But he was getting deeper into the cups and was not as proactive as his erstwhile protege MR.
The MR camp was busy demoralizing Anura. At the SLFP convention held in Kurunegala there was a well orchestrated hooting when Anura arrived on stage. Day by day pressure was brought on CBK to turn to MR and she was not helped by Anura’s reputation for drinking and indolence. No one knew that he had developed a cancer in his liver which Tissa Vitarana – a superb doctor, told me was caused by excessive drinking. The UNP which worked hand in glove with Mahinda to embarrass CBK now discovered that their favourite SLFPer (MR) whom they had nurtured could become a formidable candidate.
They filed a case through Kabir Hashim challenging Mahinda’s conduct in setting up “Helping Hambantota”, as a fund to collect money for the rehabilitation, presumably, as its name indicates, of Hambantota District. If found guilty he could have been imprisoned for four years as Sarath Silva proclaimed in retirement many years later. The “Helping Hambantota” fund created a dilemma for the Finance Ministry. Only the Treasury is entitled to set up special funds and when I was questioned about it in Parliament I had to frankly admit that “Helping Hambantota” was not properly constituted.
However MR’s Secretary Lalith Weeratunga had managed to get a letter from the Treasury stating that they were aware of this fund which proved to be a sufficient handle to save Mahinda. Kabir Hashim not only lost his case but was reprimanded by the CJ. He narrowly escaped being thrown in jail instead of MR.
Alternate Governor
As a prelude to a budgetary exercise the Ministry of Finance undertakes many discussions about foreign financial contributions which help in formulating our “foreign exchange budget”. All such inflows are depicted in the national budget under the relevant subheads. These discussions are held with both multilateral and bilateral donors. Among multilateral donors we transact business mainly with the IMF, the World Bank group and the ADB. In all these cases the Minister of Finance is an Alternate Governor who attends the annual sessions of these institutions.
The IMF-World Bank meetings are held twice a year as spring and autumn sessions and ADB meetings are held once a year. All these institutions have a practice of having their meetings in Washington and Manila as the case may be. However on every third year meetings are held in a member state. I was the Alternate Governor of these institutions from 2004 to 2015 which adds up to a considerable amount of travelling to all parts of the world. While innumerable ‘pilgrimages’ were made to Washington and Manila during this time, I also travelled to Ankara, Nagoya, Tokyo, Astana, Hyderabad, Singapore, Bali, Shanghai, and Bangkok for these multilateral sessions. Since most Finance Ministers of the world tend to attend these meetings, we also had fruitful meetings with many of them on bilateral issues. It was a good opportunity to review existing projects as well as discuss new requests. Many Ministers were accompanied by heads of their organizations that funded development efforts in the Third World. For instance the heads of the Saudi Fund, Norad, CIDA, UNDP, the Gulf Fund and many others who were funding Sri Lankan projects were present for a review of our joint efforts.
The agenda for IMF meetings was not too complicated. It began with the address of the heads of the IMF and World Bank followed by an overview of the global/regional economy and projections for the future by its Chief Economist. During my time, the post of Chief Economist was held by Raghuram Rajan, the distinguished scholar of Indian origin from the Economics Department of the University of Chicago. He was the first economist to predict the impending economic crisis of the late 20th century beginning with the failing housing market in the US.
He later became the Governor of the Reserve Bank of India at the invitation of Finance Minister Chidambaram. However having fallen out with the Modi government he went back to Chicago. We then had a meeting of the G40 which was a grouping of the developing countries. Here the concerns of the “receivers of aid” were articulated in the presence of the MD of the IMF and the President of the WB. At these meetings I was invariably asked to intervene by our group. Accordingly I characterized our plight as those of “innocent bystanders” whose economies were hit by the financial crisis which enveloped the developed world.
It must be remembered that this was the time when the global financial architecture was shaken to its roots following the American financial debacle. It was aptly described as a system “too big to fail”. The G40 meeting was followed by a luncheon hosted by the Indian Finance Minister for the South Asia group. Our geographical group comprised India, Bangladesh, Nepal, Bhutan and Sri Lanka. In my time our hosts were P. Chidambaram and Pranab Mukherjee who were the relevant Finance Ministers of India.
Afterwards many bilateral meetings were held on the sidelines of the main meetings. We invariably had meetings with India, the Gulf States, US, Japan, China and the Nordic countries where we could discuss progress in the projects underway funded by those countries as well as future funding for projects which had been submitted by the External Resources Division of the Finance Ministry. The grand finale was the plenary session where member states could make their interventions. Usually only eight minutes were allocated for each country.
The meeting ended with the formal responses of the heads of the IMF and WB to the concerns raised by delegates and a “family photograph”. I also had short “one to one” meetings with the MD of the IMF and the head of the World Bank. When De Rato the MD of IMF retired I called on him and presented him with a few packages of Ceylon tea and thanked him for his support extended to us particularly during the Tsunami. He remarked ruefully that I was the only representative of the developing countries who came to bid him farewell.
Country meetings
Perhaps the most important of our meetings were the “country meetings” when the senior officials of the IMF and WB reviewed the status of our economy as well as country projects spanning all aspects of the aid programme. I began the meeting with an introduction which reviewed the economy of Sri Lanka since our previous meeting. This was followed by a statement by the Governor of our Central Bank Nivard Cabral or his representative. One of the senior most officials of the IMF – Dr Kato a Japanese national, would then respond and turn over the discussion to the divisional leaders who would take up specific issues in project implementation. For example the Director overlooking education projects would review their activities in Sri Lanka while the Director in charge of budgetary reform would present his divisions analysis of our current budget and their recommendations for the forthcoming one.
It was an interesting high level discussion since we had come to know each other over a period of time and could speak frankly about our concerns. At the end of these discussions I would host the participants for a lunch usually at a top class Chinese restaurant close to the IMF building. Since we had an officer of the Central Bank attached to the IMF in Washington he took care of all these arrangements. He took care to invite a few other senior officials attached to the Maaging Director’s secretariat for that meal.
These and other public relations operations, including arranging a tour of our tourist hotspots when they were on mission in Sri Lanka, helped in smoothing our conversations and we were able to create a sense of goodwill which was very useful when it came to gaining the assent of the governing board which depended heavily on staff recommendations.
IMF ideology
A constant refrain about the IMF is that it follows a neo-liberal economic agenda. Since the West led by the US are the main shareholders of the IMF its Board usually toes a line which is favourable to Western interests. These interests include the regulation of the banking system and careful management of the global currency and exchange system which depended on US money supply and interest rates. Since the US dollar was the reserve currency of the world it held all the cards in the global financial game.
Part of our discussions were with the US Secretary to the Treasury and the Chairman of the Federal Reserve. When I first participated in IMF meetings the head of the Fed was Alan Greenspan [1987-2006] the legendary economist who dominated US economic policy for decades. He was followed by Ben Bernanke and Janet Yellen. They all participated in IMF meetings and Yellen in particular had special meetings with Finance Ministers to warn them of the possible consequences for their economies due to changes in the monetary policies of the US. For instance when the US raises interest rates money invested in developing countries tend to flow back to the US. When the US Fed reduces its interest rates there is a reverse flow to the poorer economies which offer higher rates.
Discussion with IMF officials in Colombo
When it comes to developing countries facing economic crises the IMF helps “by offering loans, technical assistance and surveillance of economic policies”. Loans are conditional on the following of a mutually agreed recovery programme for which funds are released in tranches after staff reviews which are endorsed by the Governing Board of the IMF. Sri Lanka has had 16 such programmes but none of them have been completed because the Sri Lankan side has aborted them mid stream due to political considerations.
In countries which go to varying types of polls almost every year, leaders find it difficult to accept the bitter economic recommendations of the IMF and the Central Bank. This is particularly true of Rajapaksa regimes because an electoral loss meant that “their occupation is gone” to use Shakespearean language. Subsidies however deleterious to growth is sacrosanct in this country and governments of the day prefer to pass on the hard decisions to future generations even if it means the breaking of its understandings with the IMF.
However there are some critics who challenge the model of growth adopted by the IMF. ‘Ihey find an alternative in closed economies where consumption is curtailed through a regime of restrictions and production is more for a domestic market. The economic models of such closed economies (also called “fortress economies”) have failed in the last 50 years and with the fall of the Communist blocs and the new trade policies of China, such an alternative is now hardly credible as a viable economic solution. Russia, China and Vietnam are keen members of the IMF and they jealously guard their interests in a globalized economy.
Donor meetings
In 1978 Ronnie de Mel established the practice of holding an annual meeting with our donor community as a prelude to preparing the budget. Since the new administration under JRJ was popular with western countries there was no dearth of supporters from among non-Communist countries. This was best seen in the foreign financing of the giant Mahaweli scheme. A large amount of money was provided as grants while many of the loans were given on concessionary terms.
The funding of this “Jumbo”project – both bilateral and multilateral – was so extensive that it is unlikely that such funding would be repeated in the future. Germany, Canada, Sweden and the UK financed the building of dams in Randenigala, Rantembe, Kotmale and Victoria. Japan which wanted to join the bandwagon but could not be accommodated under Mahaweli, opted to donate a whole new TV system and a 1001 bed hospital in Jayawardenepura as outright grants. When Scandinavian countries and Canada drew up “short lists”of developing countries earmarked for foreign funding Sri Lanka ranked among the top three.
Donor meetings were held because it was difficult to manage foreign funding on a one to one basis. It was more feasible to bring our donors together with the External Resources Division of the Treasury for a three-day long meeting when project performance could be reviewed and new funds pledged for the coming year and sometimes even beyond on a three year cycle. The World Bank agreed to host such a meeting and its European office in Paris was selected as the venue.
Thus from 1978 Treasury officials and the Minister of Finance wended their way to Paris for this much anticipated donor conference. Pledges were wrapped up and the meeting concluded with a grand dinner at the Ritz hosted by Ronnie in which all heads of relevant financial institutions participated. This model was so successful that the World Bank prescribed such meetings for many countries which were on the “beggars list” for extensive foreign support. This procedure worked well under the JR regime but was reduced to a shambles by Premadasa who preferred private foreign investment particularly for his garment manufacturing enterprises.
It must be stated here that this strategy did not entail obtaining a range of loans which would come home to roost later. Funding was provided by private investors. Premadasa’s favourite official in the Treasury – the super efficient Civil Servant Paskaralingam and his handpicked Treasury officials managed to steer the foreign exchange budget to success as well as start many urban infrastructure projects which began to alter the Colombo skyline. But the raging war – LTTE in the North and East and the JVP in the South – put paid to Premadasa’s dream of making Sri Lanka economically resurgent like Singapore, South Korea and Germany – countries that he admired. He was no great fan, unlike JRJ, of the USA and UK.
When CBK took over the reins in 1994 she had to confront an ongoing northern war. Premadasa had by then physically eliminated the JVP and its top leadership. All CBK’s efforts to quickly solve the “national question” became a tragic failure which blighted her regime. It particularly affected her management of the economy which declined over time to zero growth. As Minister of Finance I managed to reverse this trend and achieve a five percent plus growth and a significant increase in per capita income.
Her presence at the Paris donor meetings enabled western countries and Japan to complain to her about the escalating war in the North and East. To add to the countries security concerns several senior ministers Kadirgamar, CV Goonaratne and Jeyaraj Fernandopulle were assassinated and she herself had a narrow shave – all highlighting the stresses in a war torn country which were noted by the donors. Her strategy of taking her deputies GL Peiris and SB Dissanayake to Paris backfired in that they were exposed to the details of our economic debacle and the persisting concerns of western donors.
As SB told the media later he and GL realized at these meetings that CBK could not meet the challenge of managing the economy and therefore decided to cross over to Ranil and the UNP. To add to the misery the Tsunami of 2004 derailed all her plans and called for a concerted effort to put our foreign funding on a sounder footing.
We in the Finance Ministry decided to take the bold step of holding the Development Forum in Kandy. Earlier an attempt was made by Japan to host the Forum in Tokyo. It was decided then to move the venue from Paris to Tokyo largely due to the initiative of Japan’s roving ambassador Akashi who was well known for formulating his “Akashi Doctrine”. According to this policy Japan pledged substantial funds for development if the countries’ domestic conflicts were ended. It had been tested and tried successfully in Cambodia. This approach had been welcomed by Ranil’s regime.
But the LTTE had pulled out at the last minute and the Tokyo meeting had to be canceled. Our decision to shift to Kandy was welcomed by the donor community. We invited Bill Clinton for this meeting and he responded positively by sending a recorded message through his “alter ego” Erskine Bowles, the son of Chester Bowles – the former US ambassador to India, who attended on his behalf. The Deputy Managing Director of the IMF Praful Patel and deputy MD of the ADB Li Jin (who later headed the China backed Asian Infrastructure Development Bank) also attended together with senior officials of the World Bank.
The Ceylon Observer newspaper reported “More than 150 representatives from over 50 countries and international donor agencies will participate at this meeting. According to sources, the Government aims to cut down the budget deficit for 2005 with the assistance from donor countries and agencies. Sri Lanka maintains a 5.6 percent economic growth rate even in the midst of its largest ever disaster”.
After the ensuing discussions in which attention was drawn to the need to increase funding for Tsunami relief and strengthening the peace process, more specifically P-TOMS (Post-Tsunami Opertionl Mnsgement Structure), the international community pledged three billion US dollars for reconciliation and reconstruction activity in Sri Lanka. The holding of the development Forum in Sri Lanka was welcomed by the donors and it was continued the next year in Galle. However with the change of management a few years later it was abandoned by MR and successive administrations. Those Finance Ministers preferred to have bilateral discussions by themselves with donors and their contractors which led to many accusations of corruption which became more strident by the day. Instead of donor meetings emphasis was placed by MR and Basil Rajapaksa on “unsolicited proposals”.
Sunday off
Sunday in Washington was a free day which we used to visit the bookshops in Washington and go to the theatre. There was a bargain bookshop near Dupont Circle close to our hotel which was patronized by our delegation. It had many rare books donated to it by publishers since the sales collection went to charities. It was manned by students from top universities who were only too happy to engage in discussions about new books. Another memorable event was the closing down sale of the famous Borders bookshop since the company had gone bankrupt.
All books in the shop were sold at one dollar apiece. Borders bookshops in downtown Washington and Georgetown were stormed by “egg heads” who bought up not only books at a dollar each but even the shelves and safes which were on offer in the fire sale. I also visited my Peradeniya friend and colleague Professor HL Seneviratne and his family in Charlottesville, Virginia. Once I visited Stanley Tambiah my old teacher at Peradeniya. He had retired from teaching at Harvard and was installed in an old folks home by his ungrateful family. That was my last encounter with our much loved teacher from the fifties since Tambiah died a few months later.
The practice then was to attach a senior Central Bank officer to the IMF for a two year stint. It began with AS Jayawardene who later became Governor of our Central Bank. He was followed by Karunaratne, Jayatissa, Herath, Nandalal Weerasinghe, Dheerasinghe and Ranasinghe (the last three of whom we referred to as the “The three Sinhas”- lions). They all entertained us to dinner in their homes in Maryland. There were a large number of IMF and World Bank professionals who lived close to each other in the district.
It was no surprise therefore to learn that the Democratic Senator representing Maryland was Christopher Van Hollen Jr., the son of Chris Van Hollen, a long serving US Ambassador in Colombo who was a good friend of mine. Senator Van Hollen had his early schooling in Colombo. He was a Sri Lanka supporter who was always available for meetings with us. I was happy to present a book edited by his father to mark the historic relations between Sri Lanka and the USA to mark the bicentennial.
Our Ambassadors in Washington also assisted us. They participated in our IMF-WB meetings and arranged receptions so that we could meet IMF-WB staffers socially and also meet important US politicians and officials. As they say, Washington “inside the beltway” is the happy hunting grounds of politicians and bureaucrats. I particularly remember an Ambassador joining me for a memorable concert by Ravi Shankar and his daughter Anoushka held at the Kennedy Centre. Though our work in Washington was arduous and we had to burn midnight oil, we also had a lot of fun during our visits to the US capitol.
(Excerpted from vol. 3 of the Sarath Amunugama autobiography) ✍️
Features
New arithmetic of conflict: How the drone revolution is inverting economics of war
The contemporary global landscape is currently defined by two distinct but interconnected theaters of conflict that are fundamentally reshaping the future of military engagement, as noted by political analyst Fareed Zakaria. This shifts the advantage toward smaller states, or even non-state actors, who do not need to defeat a superpower in direct confrontation; they only need to sustain a constant level of low-cost harassment. In the Middle East, the escalating tensions between the United States and Iran have moved beyond traditional brinkmanship into a high-stakes confrontation centred on the Strait of Hormuz and regional infrastructure. This direction is characterised by Iran’s sophisticated use of asymmetric ‘precise mass’ to challenge American naval and technological superiority, forcing a re-evaluation of how a superpower maintains deterrence against a revolutionary regime that views its own hardware as expendable. This theatre serves as a primary example of how a medium-sized power can utilise low-cost, high-volume technology to neutralize the traditional advantages of a much wealthier adversary, potentially driving the region toward a dangerous nuclear threshold as conventional red lines are blurred.
Simultaneously, the war between Ukraine and Russia has become the world’s preeminent laboratory for the digital transformation of the battlefield. The direction of this conflict has shifted from a 20th-century war of attrition into a 21st-century war of algorithms, where the most critical ammunition is no longer just artillery shells, but data and software. Ukraine’s rapid adaptation—turning commercial drones into precision interceptors and using AI to process millions of combat images—has created a template for modern survival against a larger industrial power. Together, these two conflicts signal a global transition where the ‘exquisite’ military models of the past are being dismantled by the ‘new arithmetic’ of mass-produced precision. This essay examines how the inversion of war economics in these regions is ensuring that future supremacy will not belong to those with the most expensive platforms, but to those who can master the integration of industrial-scale with near-real-time software intelligence.
Fundamental departure
The ‘New Arithmetic of Conflict’ represents a fundamental departure from the 20th-century military paradigm, shifting the focus from high-cost, high-performance ‘exquisite’ systems to the power of ‘precise mass.’ For the last 50 years, military supremacy—particularly for the United States and its allies—has been defined by technologically superior platforms, such as the F-35 fighter jet or the Tomahawk cruise missile. While these systems are undeniably magnificent in their capabilities, they are also incredibly costly and irreplaceable in the short term. Because they take years to design and manufacture, losing even a handful in active combat is strategically damaging and painful for a modern military. This old model relied on a limited number of high-end assets that were slow to produce and even slower to replace, creating a vulnerability that smaller, more agile adversaries have now begun to exploit.
This traditional economic model is being turned upside down by the rise of cheap, commercial-off-the-shelf technology that achieves results previously reserved for superpower budgets. The emergence of the Shahed-type drone, which costs approximately $35,000, illustrates this shift perfectly. Unlike a $2 million cruise missile, these ‘one-way’ drones are built from common parts and can be launched in massive swarms. This creates a state of ‘precise mass,’ where the sheer volume of incoming, low-cost threats can overwhelm even the most sophisticated and expensive defence systems. The attacker no longer needs a massive industrial base to strike with precision; they only need the ability to scale simple, autonomous hardware.
Perhaps the most radical aspect of this inversion is the ‘cost-exchange ratio’ between attack and defence. In the past, an attacker generally had to spend more to destroy a target than a defender spent to protect it. Today, the arithmetic favours the attacker by an order of magnitude. To intercept a single $35,000 drone, a defender may be forced to fire a Patriot interceptor missile that costs roughly $4 million. This means the defender is spending over 100 times more than the attacker just to maintain the status quo. This economic reality suggests that a wealthier nation can effectively be ‘bankrupted’ or depleted of its ammunition reserves by a much smaller state or even a non-state actor using constant, low-cost harassment.
Primary laboratory
Ukraine has served as the primary laboratory for this new era of warfare, demonstrating that the real value in modern conflict is shifting from hardware to software and data. Ukrainian forces are producing stinging interceptor drones for as little as $2,000, capable of taking down far more expensive hardware. More importantly, they are treating battlefield data as a strategic asset, using millions of annotated images from combat flights to train drone AI. This creates a cycle of rapid wartime adaptation where lessons from the battlefield are turned into mass production in days rather than years. Ultimately, the winner of future conflicts may not be the nation with the finest individual platforms, but the one that can combine a small number of ‘exquisite’ weapons with a vast, intelligent, and cheaply networked mass of autonomous systems.
Building on the distinction between the ‘exquisite’ and the ‘expendable,’ the shift in military doctrine reflects a move away from the post-Cold War reliance on a small number of ultra-sophisticated assets toward a more resilient, high-volume architecture. For decades, Western military superiority was predicated on having the most advanced technology in the sky or on the sea, but the sheer cost and complexity of these systems have created a ‘fragility of excellence.’ When a single stealth fighter costs over $100 million, its loss is not merely a tactical setback but a national news event and a significant blow to the overall fleet’s readiness. This creates a psychological and strategic ‘risk aversion,’ where commanders may hesitate to deploy their most capable assets in high-threat environments for fear of losing an irreplaceable piece of national infrastructure.
Furthermore, the industrial reality of ‘exquisite’ systems is that they are built on highly specialised, low-volume production lines. In a high-intensity conflict, the rate of attrition—the speed at which equipment is destroyed—can quickly outpace the capacity of a modern industrial base to replace it. If a nation can only produce a few dozen advanced interceptors a year but loses hundreds of drones or missiles in a single week of combat, the mathematical deficit becomes insurmountable. This bottleneck has forced a re-evaluation of what constitutes a ‘good’ platform; the priority is shifting toward systems that are ‘good enough’ to be effective but cheap enough to be lost without compromising the mission or the budget.
In contrast to these legacy systems, the ‘expendable’ model treats hardware as a consumable resource, much like ammunition. By utilising modular designs and civilian-grade components, nations can mass-produce thousands of autonomous units that are inherently ‘attrition-tolerant.’ This does not mean the end of high-end technology, but rather its repositioning. Instead of a single $100 million jet trying to do everything, the future likely involves a ‘high-low’ mix where a few exquisite platforms act as command-and-control hubs, orchestrating vast swarms of cheap, expendable drones. This evolution ensures that even if the enemy successfully targets dozens of units, the collective network remains functional, shifting the strategic advantage back to the side that can sustain the fight through industrial scale and digital adaptability.
Concept of ‘precise mass’
The concept of ‘precise mass’ represents a strategic pivot where quantity possesses a quality of its own, enabled by the democratization of high-end technology. Historically, precision was a luxury available only to the world’s most advanced militaries, requiring specialised Guidance Systems and satellite constellations. Today, the ‘New Arithmetic’ flips this model by integrating commercial-off-the-shelf components—such as GPS chips found in smartphones and engines from hobbyist aircraft—into lethal, autonomous platforms.
This shift allows smaller states and non-state actors to achieve tactical objectives that once required a superpower’s budget, effectively levelling the playing field through the clever application of low-cost innovation.
The ‘Shahed Model’ serves as the primary case study for this transformation. By producing ‘one-way’ suicide drones for approximately $35,000 each, Iran has created a weapon that is essentially a flying piece of ammunition.
Because these drones are built from common, globally available parts, they are insulated from many traditional supply chain disruptions and can be manufactured at an industrial scale that far outpaces sophisticated cruise missiles. This approach prioritises ‘good enough’ technology—systems that are sufficiently accurate to hit a target but inexpensive enough to be deployed in staggering numbers without financial second-guessing.
The true power of this model is realised through ‘swarm tactics,’ which weaponise the mathematical limitations of modern air defences. When a country launches dozens or even hundreds of these low-cost drones simultaneously, it forces the defender into a ‘saturation’ crisis. Even the most advanced missile defence systems have a limited number of interceptors and can only track a finite number of targets at once. By flooding the airspace with cheap decoys and suicide drones, an attacker can ensure that while many units are shot down, a sufficient percentage will inevitably leak through to strike their targets. This creates a state of ‘precise mass,’ where volume becomes the ultimate delivery mechanism for precision, rendering traditional, high-cost defence umbrellas increasingly obsolete.
This evolution signifies that the era of the ‘silver bullet’—the single, perfect weapon—is giving way to the era of the ‘steel rain.’ In this new environment, the strategic advantage shifts to the side that can manage the highest rate of ‘precise attrition.’ Success is no longer measured by the technical sophistication of a single strike, but by the ability to sustain a continuous, overwhelming flow of autonomous threats that exhaust the enemy’s resources, patience, and defensive capacity.
‘Bankruptcy of the Defence’
The ‘Bankruptcy of the Defence’ represents a critical failure in the modern military-industrial complex’s ability to counter asymmetric threats. In the 20th century, the financial burden of warfare typically fell on the aggressor, who had to invest in expensive bombers or long-range missiles to penetrate a nation’s borders. Today, that economic gravity has shifted entirely. The most radical part of this inversion is the ‘cost-exchange ratio,’ a mathematical reality that turns defensive success into a financial liability. When a defender successfully intercepts a threat, they are often winning the tactical battle while simultaneously losing the economic war.
This disparity is most visible in what can be called the ‘$4 Million Solution.’ In modern conflict zones, we regularly see sophisticated air defence batteries—designed to intercept high-altitude ballistic missiles—being forced to engage low-speed, ‘suicide’ drones. Using a $4 million Patriot interceptor to neutralise a $35,000 Shahed-type drone is an unsustainable strategy. Even if the defence achieves a 100% intercept rate, the attacker is essentially ‘trading up’ in value at a staggering scale. The defender is forced to expend a finite, high-cost resource to eliminate a nearly infinite, low-cost nuisance, creating a logistical bottleneck where the supply of interceptors can never meet the demand of the swarm.
This ‘Losing Game’ fundamentally alters the grand strategy of global powers. Mathematically, when a defender is spending over 100 times more than the attacker per engagement, they are participating in a process of rapid financial and material depletion. As Fareed Zakaria notes, this ‘new arithmetic’ shifts the advantage toward smaller states, insurgent groups, or even criminal organisations. These actors do not need to defeat a superpower’s navy or air force in a direct confrontation; they only need to sustain a constant level of low-cost harassment. Over time, the cost of maintaining a ‘perfect’ defense becomes so high that it can effectively bankrupt a wealthier opponent or force them to withdraw from a region simply because the price of protection has become greater than the value of the presence.
Interceptors alone won’t do
Ultimately, this economic inversion suggests that the future of defence cannot rely on ‘exquisite’ interceptors alone. The current model is built on a scarcity of precision, but in an era where precision is mass-produced, the defense must find a way to make interception as cheap as the intrusion. Until a nation can field directed-energy weapons or low-cost kinetic interceptors that match the $35,000 price point of the threat, they remain trapped in a defensive paradigm that is both mathematically flawed and strategically exhausting.
The final piece of this military evolution is the emergence of Ukraine as the ‘Great Laboratory’ of modern warfare, where necessity has birthed a model of adaptation that operates at wartime speed. This environment has transformed the country from a passive recipient of aid into a sovereign architect of a new kind of combat. Central to this transformation is the development of the ‘STING’ interceptor drone. Produced by groups like Wild Hornets for approximately $2,000, these drones can reach speeds of 280 km/h—fast enough to chase down and destroy the lumbering Shahed drones that have plagued Ukrainian infrastructure. By mid-2025, these low-cost predators had already downed over 3,000 enemy targets, proving that a $2,000 solution could reliably neutralize a threat costing tens of thousands, further tilting the economic scales in favor of the agile defender.
However, the most significant output of this laboratory is not the hardware itself, but the data it generates. Defense Minister Mykhailo Fedorov has noted that Ukraine now possesses a unique array of battlefield data that is unmatched anywhere in the world, including millions of annotated images gathered during tens of thousands of combat flights. In a historic move, Ukraine has begun opening access to this ‘digital ammunition’ through a dedicated AI platform. This allows international partners and defense firms to train their algorithms on real-world combat footage—spanning everything from electronic warfare interference to the movements of camouflaged ‘turtle tanks’—bridging the ‘sim-to-real’ gap that often causes sophisticated Western drones to fail in unpredictable, messy environments.
‘Software-defined’ battlefield
This data-centric approach has led to a ‘software-defined’ battlefield where the loop between a lesson learned, and a technical update is measured in days. Ukraine is now moving toward a procurement model where AI-driven analytics, rather than manual requests, determine which systems are purchased based on their real-world effectiveness. By treating every drone sortie as a data point in a broader matrix, the Ukrainian military is effectively closing the loop on procurement and employment, ensuring that only the most effective, attrition-tolerant technologies reach the front. This institutionalisation of failure analysis into the next generation of software means that the ‘Made in Ukraine’ badge has become a global gold standard for battle-proven, autonomous technology.
Ultimately, the implications of this laboratory stretch far beyond the current conflict. As human judgment gradually gives way to computer algorithms for target detection and navigation, the war’s most valuable legacy may be the creation of the world’s first ‘algorithmic’ military. The transition from industrial mass to algorithmic precision suggests that the countries that prevail in the future will not be those with the largest stockpiles of stagnant hardware, but those that can own and manage the ‘data polygons’ necessary to refine their autonomous systems in near-real time. Ukraine is no longer just fighting a war; it is hosting the debut of a future where data is the ultimate force multiplier.
The inversion of war economics signifies a fundamental shift where industrial capacity and software integration have eclipsed the traditional pursuit of ‘technological exquisiteness’ as the primary metrics of military power. For decades, the measure of a superpower was its ability to field a small number of nearly invulnerable, multi-million-dollar platforms. However, in the modern landscape, these ‘exquisite’ systems are increasingly vulnerable to ‘precise mass’—vast swarms of low-cost, autonomous drones that can be produced at a rate of thousands per day. This transition means that the ‘physical platform’ is becoming a commodity, while the true competitive advantage lies in the ‘compute foundation’ and ‘software-defined’ capabilities that allow these systems to be networked and updated in real-time. Consequently, the victor in future conflicts will not necessarily be the nation with the most expensive fighter jet, but the one that can maintain a resilient, high-volume industrial base capable of sustaining an ‘attrition-tolerant’ force that evolves faster than an adversary can target it.
Double-edged sword for smaller nations
For smaller nations like Sri Lanka, the arrival of this new military era offers a double-edged sword of strategic opportunity and profound vulnerability. Traditionally, small states were sidelined in the global arms race due to the prohibitive costs of ‘exquisite’ platforms like advanced fighter jets or missile destroyers, which often consumed unsustainable portions of a national budget. However, the shift toward ‘precise mass’ means that countries with limited resources can now develop significant deterrent capabilities through the localised production of low-cost, high-impact autonomous systems. By investing in software-defined defences and domestic drone manufacturing, a nation like Sri Lanka can achieve a level of coastal and territorial security that previously required a superpower’s investment. Not only that, but Sri Lanka can also develop into an export market for the new precise technology which has a wide demand from warring countries. Conversely, the democratisation of these ‘one-way’ technologies also means that non-state actors or regional adversaries can more easily threaten national infrastructure, forcing small nations to prioritise digital resilience and rapid technological adaptation over the maintenance of ageing, high-cost legacy hardware.
by Prof. M. W. Amarasiri de Silva
Features
Turning science into action: Prof. Gothamie Weerakoon calls out Biodiversity “Narratives”
By Ifham Nizam
In an exclusive interview with The Island, Ifham Nizam speaks with Professor Gothamie Weerakoon—Senior Curator and leading researcher on lichens and slime moulds at the Natural History Museum—who offers a candid, evidence-driven critique of corporate sustainability, global biodiversity governance, and the realities facing countries like Sri Lanka.
With over 450,000 specimens under her care and more than 100 new lichen species described through fieldwork across South and Southeast Asia, Prof. Weerakoon brings a rare combination of deep scientific expertise and frontline ecological observation.
Her message is clear: biodiversity loss is accelerating, and much of what is presented as “progress” remains largely unproven.
Excepts of the full interview
Q: The Natural History Museum speaks of turning science into action—what evidence is there that businesses are actually changing behaviour rather than rebranding sustainability narratives?
A:There is emerging evidence of change, but when biodiversity is the focus, the gap between action and narrative becomes much more visible.
Some companies are moving beyond broad commitments by measuring their impacts on ecosystems, setting targets to halt biodiversity loss, and reporting through frameworks like TNFD (Taskforce on Nature-related Financial Disclosures). But these are still the exceptions.
Real change becomes evident when businesses transform supply chains—eliminating deforestation-linked commodities, adopting regenerative agriculture, and working with local communities to restore ecosystems. Investment in habitat restoration and science-led, location-specific action also signals progress.
However, without clear baselines, measurable outcomes, and long-term commitment, biodiversity claims risk remaining abstract. At present, biodiversity is still more visible in corporate language than in verified outcomes.
Q: Are multinational corporations genuinely reducing their biodiversity footprint, or simply shifting environmental costs to developing countries like Sri Lanka?
A: The reality is mixed, but there is strong evidence that impacts are often being shifted rather than reduced.
Consumption in wealthier economies continues to drive habitat loss in biodiversity-rich regions. In countries like Sri Lanka, export-driven sectors, such as agriculture and rubber, contribute to deforestation and habitat fragmentation.
Companies may improve their environmental performance, domestically, while outsourcing ecological damage to regions with weaker regulation. So while awareness is increasing, most corporations are not yet reducing their global biodiversity footprint.
Q:How do you distinguish between credible biodiversity action and corporate greenwashing in real terms?
A:Credible action is science-based, measurable, and location-specific.
Companies must establish baselines, quantify their ecological impacts, and demonstrate real outcomes—such as reduced deforestation or restored habitats—verified independently.
Greenwashing, on the other hand, relies on vague terms like “nature-positive” without evidence. It often highlights small projects while ignoring major impacts, or depends on offsets instead of reducing harm.

Red Christmas lichens are not a species found in Arctic habitats. Instead, it is characteristic of tropical and subtropical regions, indeed found in the Sinharaja Forest Reserve, particularly in the Morningside and Pitadeniya areas
The key test is simple: can a company prove that biodiversity loss linked to its operations is declining in specific places over time? If not, it is likely narrative rather than action.
Q:Many biodiversity commitments remain voluntary—should there be legally binding global standards for corporate accountability?
A:Yes, there is a strong case for binding standards.
Voluntary commitments lead to uneven progress and make it difficult to separate genuine action from superficial claims. Legal frameworks could ensure consistent reporting, accountability, and minimum standards.
However, biodiversity is highly local. Any global system must allow for flexibility and support developing countries rather than imposing rigid rules.
Q:What sectors are currently causing the most irreversible biodiversity damage, and why are they still operating with limited restrictions?
A:The most damaging sectors include agriculture, forestry, mining, and fossil fuel extraction.
Agriculture—especially large-scale monocultures—drives deforestation and habitat loss. Mining and fossil fuels cause long-term ecological disruption, while marine ecosystems suffer from overfishing.
These sectors persist with limited restrictions because they are economically powerful, biodiversity loss is harder to quantify than carbon emissions, and global supply chains allow impacts to be outsourced. Regulation also remains fragmented and weakly enforced.
Q:In countries like Sri Lanka, development projects often override environmental concerns—how can science-based tools realistically influence political decision-making?
A:Science-based tools can make biodiversity loss visible and measurable.
Environmental impact assessments, ecological mapping, and predictive models allow policymakers to understand trade-offs clearly. When ecological risks are quantified, they become harder to ignore.
The key is integrating these tools into planning systems so environmental considerations are not optional, but a core part of decision-making.
- Phyllopsora species in Monatne forest of Sri Lanka
- Green Algal lichens are dominant in wet mountains in Sri Lanka
Q:Can biodiversity conservation truly coexist with large-scale infrastructure and energy projects?
A:Yes—but only if biodiversity is considered from the beginning.
Projects must be designed using science-based planning, avoiding sensitive ecosystems and incorporating mitigation strategies like wildlife corridors and habitat restoration.
Conservation and development are not inherently incompatible, but poor planning creates conflict.
Q:Are global biodiversity frameworks failing to address ground realities in developing economies?
They often fall short in implementation.
A:Global frameworks provide guidance, but must be adapted to local conditions. Developing countries face capacity constraints and competing priorities.
Success depends on building local scientific capacity, aligning goals with economic realities, and ensuring flexibility in how targets are applied.
Q:What role should governments play when businesses resist biodiversity regulations citing economic pressures?
A:Governments must act as regulators and enforcers.
They should establish clear legal standards, backed by monitoring and penalties. At the same time, incentives—such as green finance and technical support—can help businesses transition.
Economic arguments should not override ecological realities, especially when long-term costs of biodiversity loss are considered.
Q:Are financial institutions doing enough to penalise environmentally destructive investments?
A:Not yet. While awareness of biodiversity risk is increasing, short-term profits still dominate decision-making. ESG frameworks exist, but enforcement is weak.
Stronger systems are needed—binding criteria, independent audits, and better integration of ecological risk into financial decisions.
Q:How can local communities be given real decision-making power rather than token consultation?
A:Communities must be recognised as partners, not stakeholders.
Legal rights, participatory planning, and co-management systems are essential. Traditional knowledge should be integrated with scientific data.
Without real authority, consultation becomes symbolic rather than meaningful.
Q:What immediate, science-backed interventions can be implemented in Sri Lanka?
A:Practical steps include restoring mangroves, creating wildlife corridors, and community-led reforestation.
Using GIS mapping and monitoring systems can identify high-risk areas, while sustainable livelihood programmes reduce pressure on ecosystems.
These interventions must be evidence-based and locally adapted.
Q:How can policymakers protect biodiversity-rich regions from short-term exploitation?
A:Through zoning laws, protected areas, and mandatory environmental assessments.
Valuing ecosystem services in economic planning is also critical. When biodiversity is treated as an economic asset, it becomes harder to ignore.
Q:What mechanisms exist to hold corporations accountable when biodiversity damage crosses borders?
A:International agreements, supply chain regulations, and reporting frameworks like TNFD play a role.
Financial institutions, legal systems, and civil society also contribute to accountability. But enforcement across borders remains a major challenge.
Q:Is there sufficient transparency in corporate biodiversity reporting?
A:No—current systems are inconsistent and largely voluntary.
Many companies fail to quantify their impacts, and independent verification is limited. Without standardised metrics and audits, transparency remains inadequate.
Q:How can biodiversity be integrated into national economic planning without slowing growth?
A:By recognising that biodiversity supports economic resilience.
Nature-based solutions—such as mangrove restoration or sustainable agriculture—deliver both ecological and economic benefits.
Strategic planning can align conservation with development rather than treating them as opposing goals.
Q:What are the long-term economic risks of biodiversity loss in South Asia?
A: They are severe. Declining pollination, soil degradation, and fisheries collapse threaten food security. Loss of forests and wetlands increases disaster risks.
Ultimately, biodiversity loss undermines economic stability and increases vulnerability to climate shocks.
Q:How can science communication better influence public opinion and policy?
A: By making data accessible and relevant.
Visual tools, storytelling, and collaboration with media can translate complex science into actionable insights. Public engagement is essential for policy change.
Q:Are current conservation models too dependent on international funding?
A:Yes, and that creates vulnerability.
Long-term sustainability requires diversified funding—government support, private investment, and community-based initiatives.
Local ownership is key to lasting impact.
Q:Ultimately, who should bear the greatest responsibility for reversing biodiversity loss?
A:Responsibility is shared—but governments hold the greatest leverage.
They set the rules, enforce regulations, and shape economic systems. Corporations and consumers also play critical roles, but without strong governance, progress will remain limited.
Prof. Weerakoon’s assessment is both measured and uncompromising: biodiversity loss is no longer a distant ecological issue—it is an economic, political, and social crisis.
Aligned with the mission of the Natural History Museum, her message is clear: the future of conservation depends not on promises, but on verifiable, science-based action grounded in real ecosystems—not narratives.
Features
Looming shadow: How and why a distant war could threaten vitality of Sri Lankan healthcare
An Independent Freelance Correspondent
As the sun sets over the Indian Ocean, the tranquil beauty of Sri Lanka feels many a world away from the smoke, thunder, misery and deaths in the Middle East, taking place in the midst of a senseless war. Yet for all that, in our interconnected world, a butterfly might flit its wings in the Gulf, and a storm might eventually break over our own little paradise island, as a strange reversal of the status quo. However, the escalating conflict in the Middle East is no longer just a distant headline for Sri Lankans; it is an ominous cloud gathering that threatens the very backbone of our much-bandied social contract, our healthcare system.
While we often view war through the lens of geopolitics or rising oil prices, the “Ground Zero” of its impact in Sri Lanka may well be the hospital ward, the local dispensary, and the dinner tables of our most vulnerable citizens, just as much as it would impact on the healthcare professionals who are responsible for maintaining a well-oiled machine; the pun being intentional.
The Fuel Paradox: When Mobility Becomes a Luxury
Our health service runs on wheels as much as it does on training and wisdom. The entire system has to be supported by energy. The Middle East remains the lifeblood of our energy supply, and any disruption to the Strait of Hormuz would send immediate shockwaves to our fuel pumps. Lack of fuel, as well as skyrocketing prices of oil, would have a cascading detrimental effect on our health service.
For the average citizen, a spike in fuel prices is not just a “transport issue” but a miserable calamity that could become a noteworthy barrier to life-saving healthcare. When bus fares double and three-wheeler charges skyrocket, a mother in a rural village may think twice and even hesitate to take her feverish child to the nearest Base Hospital. In the calculus of poverty, the cost of the journey often outweighs the urgency of the ailment, until and most unfortunately, it sadly and tragically becomes too late.
Furthermore, our healthcare workers, the doctors, nurses, public health midwives, clerks, orderlies, and other grades of minor staff, are certainly not immune to the impacts of the fuel crisis. Unlike many top-tier officials of the rest of the public service, most medical staff rely on their own vehicles or public transport to reach their posts. If fuel becomes a rationed luxury, we risk a kind of inevitable “silent strike” where the healers simply cannot afford to commute to the hallowed places of healing. The other grades of staff mentioned are certainly no less important to run the machine, and they will also be at the receiving end of the fuel crisis and transport problems.
A Bitter Pill: The Private Sector Squeeze
While the state provides free healthcare, the private sector has long acted as a vital pressure valve for the national system. However, the conflict is rapidly tightening the screws here as well.
=The Price of Healing: Most of our medicines and vaccines are imported. With global shipping routes disrupted and “war risk” insurance premiums surging, the landed cost of a simple strip of a commonly used medicine or a vital course of antibiotics to clear a lung infection would climb disproportionately.
=The “In-Patient” Inflation: Private hospitals are energy-intensive hubs. From the electricity that powers life-support machines to the diesel that runs emergency generators, rising costs will most unfortunately have to be passed directly to the patient.
=Consultation Charges: As overheads, maintenance costs, staff salaries, and medical supplies spiral, even the renowned Private Hospitals, as well as even the most dedicated private practitioners, would find themselves forced to increase fees.
When the private sector becomes unaffordable, those patients migrate back to the already overstretched state hospitals, creating a “domino effect” of long queues and exhausted resources.
The Empty Plate: Nutrition as the First Line of Defence will be in danger
Perhaps, the most insidious impact of the Middle Eastern crisis is the one that happens at the grocery store leading to great difficulties in getting food into the table. Sri Lanka relies heavily on remittances from our workers in the Gulf and the robust export of our “black gold”- Ceylon Tea. The war has stalled tea exports to major markets like Iran and Iraq, costing the industry millions every week. Simultaneously, if our workers in the Middle East face displacement, the flow of foreign exchange into our country, which would benefit even the villagers, might just dry up.
When a family’s income drops, the first thing to be sacrificed is often the “quality” and even the quantity of the food that comes onto the table. We might see a return to starch-heavy, protein-poor diets. For a pregnant mother, this means anaemia and untold risks to the yet-to-be-born baby. For a growing young child, it means stunting and weakened immunity. For the elderly, it will mean increasing the frailty of old age. We are essentially “importing” a future health crisis of malnutrition that no amount of free medicine can easily fix.
The Supply Chain Shadow
Modern medicine is a “just-in-time” industry. Many of our specialised vaccines and a variegated plethora of treatments require a “cold chain” – a continuous refrigerated journey. With major Gulf air hubs facing disruptions, these temperature-sensitive medicines must be rerouted. This adds days to the journey and increases the risk of “spoilage.” A vaccine that loses its potency due to a shipping delay is not just a financial loss; it is a lost shield for a child and even, older and elderly people.
Sadly, just like the fuel situation, there have not been any worthwhile efforts to “stockpile” at least some of the essential medicines. Of course, unlike just storing fuel to stockpile, medicines have their own problems with shelf-life and expiry dates. It is indeed a vexing problem that might cause a major, tricky situation at some time in the future. The government is planning to issue medicines for two months from the clinics etc. One only hopes that the currently available stock could be used effectively without that initiative leading to a desperate shortage of essential drugs.
Navigating the Storm: Some Ways to Mitigate the Crisis
This author has brought to light some of the issues that we may see in the future. However, it is not an exhaustive or complete list of all possible consequences. There could be quite a few more. While the situation is grave at present, it is perhaps not unmanageable. To protect the vitality of our healthcare, we must adopt a “War Footing” of preparedness:
1. Fuel Priority for Healthcare: The government must establish a “Green Lane” for healthcare personnel and emergency vehicles, ensuring that they have subsidised or prioritised access to fuel to prevent service interruptions. This has to include the private healthcare personnel as well.
2. Strategic Buffer Stocks: We must move away from “just-in-time” imports and build a minimum 6-month buffer stock of essential medicines and vaccines. We need to utilise regional cooperation with neighbours like India to diversify supply routes.
3. Strengthening Primary Care: By investing in local dispensaries and public health midwives, we can treat ailments before they require expensive hospital stays, as well as extended forms of treatment, reducing the transport burden on patients.
4. Nutritional Safety Nets: Expanding school meal programmes and providing fortified food supplements to pregnant mothers can act as a firewall against the malnutrition that is likely to be caused by economic shocks.
5. Digital Health Integration: Expanding “telemedicine” can allow specialists to consult with rural patients remotely, saving both the doctor and the patient the high cost of travel.
A Call for Preparedness, but not a Harbinger of Panic
It is ever so easy to read these points and see a looming, tremendously gloomy fog that could envelop our revered Motherland in the not-too-distant future. However, from a clearer perspective, the purpose of this analysis is not for the writer to act as a prophet of doom, but for this enterprise to serve as a wake-up call for proactive management and to take all necessary steps, well in time, to avoid a catastrophe.
Our health service is the crown jewel of our nation. It has been built on the Herculean effort of generations who believed that health is definitely a right, and certainly not a privilege. To protect it, we must look beyond our borders and understand that the proverb “a stitch in time saves nine” is what we need now. We must strengthen our social safety nets before the ripples of the Middle Eastern war become a tidal wave that hits our shores. We need to act purposefully now, to be able to steadfastly cushion whatever blows that might come our way in the future.
This is not a forecast of a disaster that is one-hundred per cent certain to occur. In stark contrast, it is meant to be a sober and sombre analysis of possible ramifications that we must prepare for today, to save the lives of our people and look after their health tomorrow.
Dr B. J. C. Perera
MBBS(Cey), DCH(Cey), DCH(Eng), MD(Paediatrics), MRCP(UK), FRCP(Edin),
FRCP(Lond), FRCPCH(UK), FSLCPaed, FCCP, Hony. FRCPCH(UK), Hony. FCGP(SL)
Specialist Consultant Paediatrician and Honorary Senior Fellow, Postgraduate Institute of Medicine, University of Colombo, Sri Lanka.
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