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SLMC calls for probe into agreement signed with bondholders, others ahead of presidential election

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Rauf Hakeem

Sri Lanka Muslim Congress (SLMC) leader Rauf Hakeem, MP, demands to know why the Rajapaksa-Wickremesinghe government entered into an agreement with bondholders and commercial creditors just 48 hours before the presidential election.

MP Hakeem told The Island that he raised the issue at hand in Parliament last week when Parliament deliberated the Vote-on-Account. He drew the attention of Parliament to what he called a matter of critical importance related to Sri Lanka’s recent debt restructuring. The SLMC leader said: “While it is undeniable that reaching an agreement with bondholders and commercial creditors was crucial to steering our nation out of its economic crisis, troubling questions linger about the integrity of this process.

It is concerning that the agreement with bondholders was finalised merely two days before the Presidential elections, raising doubts about whether this, too, was exploited to serve the interests of a select few. We are reminded of the controversial $500 million bond repayment saga during the Rajapaksa administration. Similarly, the current restructuring raises the specter of insider trading—where investors, potentially armed with privileged information, acquired Sri Lankan bonds at deep discounts, only to negotiate settlements at face value, possibly in collusion with the administration.

This Parliament owes it to the people of Sri Lanka to demand transparency and accountability by initiating an independent inquiry to determine the purchase prices of these bonds, the extent of concessions offered, and whether public trust was compromised in favour of private gain. Another matter of profound national importance—the Domestic Debt Optimization (DDO) initiative, which I contend represents Sri Lanka’s third and most extensive bond scandal. This scheme, orchestrated under the stewardship of then-Finance Minister Ranil Wickremesinghe, mirrors the malfeasance of previous bond scams and inflicts severe economic injustice upon our working class.

In February 2015, the Central Bank of Sri Lanka (CBSL) was embroiled in a bond scandal involving the issuance of Rs. 1 billion in 30-year government bonds. The auction controversially accepted bids totaling Rs. 10 billion, significantly exceeding the initial offer, leading to an estimated loss of over $11 million for the nation. This incident, among others, has eroded public trust in our financial institutions.

The DDO was presented as a strategy to reduce the government’s liability to the public. However, a critical examination reveals a more sinister agenda. The Employees’ Provident Fund (EPF), the primary retirement savings of our private-sector employees, was compelled to exchange its Treasury bonds under the DDO programme

This maneuver effectively transferred substantial wealth from the EPF to a select group of beneficiaries, including: Licensed Primary Dealers, · Licensed Commercial Banks and· Non-Bank Financial Institutions

The exact magnitude of the windfall gains reaped by these entities remains undisclosed, raising serious concerns about transparency and accountability.

Calling for independent inquiry, MP Hakeem said: It is imperative that an independent investigation be conducted to: (i) Quantify the Wealth Transfer: Determine the total value siphoned from the working population’s retirement funds to the affluent few (ii) Assess Tax Revenue: Ascertain the amount of tax revenue the government accrued from these windfall profits.

Such an inquiry is essential to uphold justice and restore public confidence in our financial governance, the former Minister said.



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Navy seizes an Indian fishing boat poaching in northern waters

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During an operation conducted in the dark hours of 27 Dec 25, the Sri Lanka Navy seized an Indian fishing boat and apprehended 03 Indian fishermen while they were poaching in Sri Lankan waters, south of the Delft Island in Jaffna.

The seized boat  and Indian fishermen (03) were brought to the Kreinagar Jetty and were handed over to the Fisheries Inspector of Jaffna for onward legal proceedings.

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Delay in govt. response to UK sanctions on ex-military chiefs, and others causes concern

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General Silva / Admiral Karannagoda

Admiral of the Fleet Wasantha Karannagoda said that he is still waiting for the government’s response to the UK sanctions imposed on three ex-military officers, including him, and a former member of the LTTE.

The former Navy Chief said so in response to The Island query whether he was aware of the position taken by a three-member ministerial committee, consisting of Foreign Minister Vijitha Herath, Justice and National Integration Minister Harshana Nanayakkara and Deputy Defence Minister Maj. Gen (retd) Aruna Jayasekera.

The government named the committee in the wake of the UK declaration of travel bans and asset freezes in respect of Karannagoda, General Shavendra Silva, General Jagath Jayasuriya and Vinayagamoorthy Muralitharan, also known as Karuna. Maj. Gen. Jayasekera said that they inquired into the issue at hand.

Karannnagoda said that he would like to know the government’s recommendations if the ministerial committee briefed the Cabinet as per a decision taken by the Cabinet of Ministers. Karannagoda said that the issue should have been taken at the highest level as various interested parties continue to humiliate the war-winning military by targeting selected individuals.

Other sources, familiar with the issues at hand, told The Island that the government was yet to announce its stand.

Sources pointed out that the Opposition has been silent on what they called a matter of utmost national importance.

Cabinet spokesman Dr. Nalinda Jayathissa is on record as having described the UK move as a unilateral move and that committee was formed to examine the developments and recommend appropriate measures to the Cabinet.

Foreign Minister Herath told The Island the government was not successful in getting the British to withdraw sanctions. Describing the UK decision as unilateral, the Miniser said that the government conveyed its concerns but the UK didn’t change its stand.

The Island raised the issue with Minister Herath and Admiral Karannagoda in the wake of British MP of Sri Lankan origin, Uma Kumaran requesting the UK Foreign Secretary Yvette Cooper to expand on the government’s sanctions imposed on the four above-mentioned persons.

During a Foreign Affairs Committee meeting on 16 December, the MP for Stratford and Bow highlighted the lack of accountability and political will from the current Sri Lankan government to address war crimes and mass atrocities committed in Sri Lanka.

Sources said that David Lammy, who served as Secretary of State for Foreign, Commonwealth and Development Affairs at the time of the declaration of sanctions, had no qualms in declaring that the action taken against four Sri Lankans was in line with a commitment he made during the election campaign to ensure those responsible wouldn’t be allowed impunity. The UK government statement quoted Lammy as having said that this decision ensured that those responsible for past human rights violations and abuses were held accountable.

By Shamindra Ferdinando

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Sri Lanka outlines seven key vectors of international cooperation at Moscow forum

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Shobini

Sri Lankan Ambassador to the Russian Federation, Shobini Gunasekera recently presented a conceptual framework of seven key vectors that defined contemporary international relations and facilitated dialogue among States. She made the presentation at XI Moscow International Financial and Economic Forum held under the theme “Building Bridges: Partnership without Borders”.

In her address, the Ambassador emphasised that these vectors represent the channels through which ideas circulate, trade expands, and peace is strengthened, serving as guiding principles for cooperation amid global uncertainties. The seven key vectors highlighted were economic ties as a foundation for long-term stability; political choice and diplomacy through dialogue and multilateral engagement; security cooperation to address cross-border threats; cultural linkages through education, tourism, and professional exchanges; technological advancement, particularly in digital systems and artificial intelligence; environmental stewardship through collective action on renewable energy and climate change; and humanitarian obligations, including disaster relief and development cooperation.

 Drawing on Sri Lanka’s experience, the Ambassador illustrated the practical application of these principles by highlighting the country’s strategic location in the Indian Ocean, its role as a trade and logistics hub, and its active engagement in regional groupings such as BIMSTEC and the Indian Ocean Rim Association, where the Russian Federation serves as a Dialogue Partner.

 The potential for enhanced Sri Lanka–Russia bilateral cooperation was underscored, particularly through complementarities between Russia’s technological and energy expertise and Sri Lanka’s logistical capabilities and maritime infrastructure. She noted that such synergies could support joint initiatives in trade, innovation, tourism, and logistics, while cultural and scientific exchanges would further strengthen mutual understanding between the two countries.

Concluding her remarks, the Ambassador stated that sustained progress requires dialogue, mutual respect, and forward-looking partnerships capable of shaping a shared and stable future.

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