Category: Featured Headlines

The armed forces of Sri Lanka would always comply with the Constitution and the Army is no exception. The Army as a professional outfit is always prepared to provide security and protection to the State as necessary”, so said Chief of Defence Staff and Commander of the Army, General Shavendra Silva, addressing a gathering of Defence Advisers/Attaches of Sri Lanka-based High Commissions and embassies, invited to the Office of Chief of Defence Staff today (4).

The meeting was meant to keep those foreign Defence Advisers/Attaches informed of the current situation.

Captain Ian Keith Cain, Defence Adviser (Australia), Commander, M Shafil Bari, Defence Adviser, Bangladesh, Senior Colonel Wan Dong, Military, Naval and Air Attaché (China), Lieutenant Colonel Chang Qianjin, Assistant Military Naval and Air Attache, (China), Captain Vikas Sood, Defence Adviser (India), Lieutenant Colonel Punnet Sushill, Assistant Defence Adviser, (India), Colonel Homayou Ali Yari, Military Attaché, (Iran), Captain Gaku Fukaura, Defence / Security Attaché, (Japan), Colonel Ismail Naseer, Defence Adviser, (Maldives), Colonel Muhammad Safdar Khan, Defence Adviser, (Pakistan), Colonel Aleksey A Bondarev, Military, Naval & Air Attaché, (Russia), Colonel P.J Clayton, Defence Adviser, (United Kingdom) and Lieutenant Commander Richard Lister, Naval Attaché (United States of America) were present at this meeting.

It is the unfolding crisis in Pakistan and Sri Lanka which is forcing countries like Maldives, Nepal and Bangladesh to think again on Chinese infrastructure loans and being part of the BRI initiative.

During his trip to India last week, Nepal Prime Minister Sher Bahadur Deuba informally shared a conversation about Chinese foreign minister Wang Yi’s visit to Kathmandu in late March. The Nepalese PM, who has an equally political and erudite wife Arzu, told the visiting Wang that his country can only accept grants from Beijing and not loans for infrastructure projects. Fact is, not a single agreement on the much-touted Belt Road Initiative (BRI) was signed during Wang’s visit to Kathmandu.

With the Chinese debt in South Asia rising from USD 4.7 billion to upwards of USD 40 billion, Nepal under Deuba chose to walk out of the debt trap of the Middle Kingdom after seeing the mounting political crisis in Beijing’s tributary state of Pakistan and Sri Lanka. With more than 10 per cent of Pakistan’s external debt owed to China, the milk and honey relationship no longer tastes sweet with the Islamic Republic descending into political chaos with all democratic institutions made vulnerable by a self-serving Prime Minister in Imran Ahmed Khan Niazi and his cronies.

The situation in Sri Lanka is no different and this time they don’t have India to blame for the country staring into an economic and political abyss with hardly any foreign reserves to buy fuel and oil. The blame squarely lies on the door of the Rajapaksa Incorporated, which brought the country under severe economic stress by taking high-interest loans from China in the name of infrastructure development. Today, the island nation is under lockdown with the public having no options but to protest the state of governance of the Rajapaksa family.

It is the unfolding crisis in Pakistan and Sri Lanka which is forcing countries like Maldives, Nepal and Bangladesh to think again on Chinese infrastructure loans and being part of the BRI initiative. It was not long ago that the Chinese ambassador to Nepal used to be the Queen Bee in Nepali politics with Maoist and Communist politicians paying obeisance to Beijing’s representative.

While it seems that Sri Lanka has realized the soup its economy is in, Pakistan has doubly complicated its economic recovery with PM Niazi plunging the country into a full-blown political crisis for his own survival. He is trying to whip up public sentiment in his support by singling out the Biden administration for covertly conspiring with the Opposition to topple his regime. As if the US has Pakistan still on its high priority at a time when the Russian President has invaded Ukraine.

EU mulls tougher sanctions following Bucha ‘atrocities’

Brussels is pushing for a tougher fifth round of sanctions against Moscow following the ‘atrocities’ revealed over the weekend in the Ukrainian town of Bucha. The EU’s foreign policy chief Josep Borrell said the bloc “will advance, as a matter of urgency, work on further sanctions against Russia”. “The massacres in the town of Bucha and other Ukrainian…

While Imran Niazi’s rant against the US may be music to Beijing’s ears, China should also be worried about the future of BRI in Pakistan and about the recovery of the multi-billion-dollar loan given to Islamabad. A weak Islamabad will give strength to fissiparous forces within Pakistan as nationalist movements are building up in Balochistan, Sindh, and Khyber Pakhtunkhwa. Given the US control on global financial institutions, both Pakistan and Sri Lanka will find it very hard to recover as the two countries had shifted loyalties to Beijing in the past two decades.

Source: Hindustan Times

The parliamentary group of the Sri Lanka Freedom Party (SLFP) has decided to leave the government and function as an independent group in Parliament.

This was confirmed by SLFP member and State Minister Duminda Dissanayake, speaking to Ada Derana.

He said the parliamentary group of the party had convened a meeting today while the fourteen parliamentarians of the SLFP had decided to quit the government and act independently at tomorrow’s parliamentary session.

Meanwhile the state ministers Lasantha Alagiyawanna, Duminda Dissanayake and Priyankara Jayaratne have resigned from their respective ministerial portfolios.

Sri Lanka’s foreign currency crunch in the country is worse than before despite the depreciation in the rupee, further affecting businesses amidst the threat of wiping out industries.

Banks are not opening letters of credit (LC) with importers and businesses in need of raw materials are struggling daily, industry officials say.

LCs opening has gotten from bad to worse, an importer said noting that there’s no end in sight for this issue.

On Wednesday, the Bank of Ceylon (BoC) had suspended telegraphic transfers as they didn’t have any US dollars to execute transactions, a senior BoC official told the Business Times. The gray market for US dollar is trading at Rs. 350 to 390 rates. There are virtually no inward remittances owing to this disparity, this official as well as several other bankers said. They said the 50 per cent export earnings surrender stipulated by the Central Bank is also posing a challenge to shore up forex reserves.

“There’s no confidence in the system and migrant workers aren’t sending their hard-earned money through the banking system,” a senior banker added. The same status quo prior to the currency depreciation had only got worse, he said. He said the expected upside of the currency depreciation isn’t seen.

Kapila Ariyaratne, CEO Seylan Bank told the Business Times on Thursday that there was an uptick in inward remittances during the first two weeks after the rupee was depreciated but since then has declined drastically. “The inflows must increase.”

An importer said there’s ‘runaway depreciation’ which the banks cannot beat. Mahendra Jayasekera, Managing Director Lanka Tiles PLC

said that his company is struggling to import machinery to meet production demand. “We are struggling to open Euro 6 million import LC to bring large machines for the past four months,” he told the Business Times on Thursday. He feared that in the future importing raw materials will also be a challenge. “Our appeal is for all political parties to get together and to come up with a viable solution.”

A second banker said that honouring customer LCs is a big challenge as some are paying large bills. “We need to be reasonable and control the foreign currency outflow,” he said adding that the capacity of each bank to manage and accommodate LCs is diminishing fast.

Small transactions are driving up the exchange rates in leaps and bounds, bankers lament. A third banker said the situation has become so bad that they cannot spare US$1, 000 for foreign travel per individual. He said the impact on import-dependent businesses especially in the small and medium enterprise sector is quite uncertain, noting:. “It will be at least six months before the International Monetary Fund standby facility will be negotiated – if at all. Sustaining these businesses till then is a real challenge.”

Economists say the move to depreciate the rupee was too little too late.

A significant event in Colombo this week was the meeting between Indian External Affairs Minister (EAM), Subrahmaniyam Jaishanker and a delegation from the Tamil National Alliance (TNA). Jaishankar was in Colombo for the BIMSTEC summit.

“Vanakkam,” intoned Dr Jaishankar greeting TNA leader Rajavarothayam Sampanthan last Monday at the India House. He then asked him” Saukiyama?” or are you well. That was in Tamil. The Indian EAM was born in New Delhi and is one of three sons of Krishnaswamy Subramaniyam and Sulochana Jaishanker who have their origins from Tiruchirapalli and Chennai in Tamil Nadu respectively.

Samapanthan gave an overview of the discussions they had with President Gotabaya Rajapaksa on March 18 and asked Sumanthiran to explain the details. Sumanthiran declared that the President and his team wanted to discuss and negotiate a long-term political solution for the Tamil’s demand for devolution of power once the draft constitution is translated within the next two months. This, he declared, was agreed. However, he said, that the President further agreed to resolve several immediate issues faced by the people of North and the East — releasing persons detained under the Prevention of Terrorism Act (PTA) and held over a long term (over 10 years), and the cases of others in custody should reviewed; an immediate halt to land takeover by the military and the Government for reported archaeological investigations, wildlife and forest preservation etc; addressing the need for investigation of the disappeared and establishing a North-East Development Fund. There is no finality on this. However, TNA sources said that they hoped to receive funds from the Tamil diaspora and Tamil Nadu through this mechanism for development purposes.

Jaishankar had nodded in agreement and commented at the end that he felt satisfied that a process of negotiation had started and seemed to be clearly defining scope. He said the Indian government fully supported this process and encouraged the TNA to be proactive. He said for the first time he had heard by and large the same details being shared by the Government side as well as the TNA.

Jaishankar said India would encourage both parties to remain proactively engaged with belief and sincerity. He said President Rajapaksa has assured him that he is fully committed to delivering on the four immediate confidence building measures identified by the TNA as immediate issues to be resolved.

According to sources familiar with the discussion, the TNA team was also advised by a key member of the Indian team to enhance its dialogue with opposition political parties. In other words, it was felt that they were not interacting with the opposition groups very much. A TNA source said the remarks were “very significant” but declined to elaborate. Associated with the meeting was Indian High Commissioner Gopal Baglay.

TELO Leader Selvam Adaikalanathan intervened and tried to explain his party’s decision to boycott last Friday’s meeting with the President and said in Tamil that if India too was involved in the discussions as a possible mediator, then the TELO might reconsider attending future meetings with the Government. In response, Jaishankar said in Tamil that there were no plans or intentions for any direct involvement of India in any such talks.

Ahead of TNA’s talks with President Rajapaksa, diplomatic sources said, Adaikalanathan had been told to take part in the event. According to these sources, the TELO decision to boycott, despite advice, was the result of one of its key members holding office in a friendship organization where China is involved. However, TELO members deny the charge though they concede one of their top- rungers is a Joint Deputy Chairman of the organization.

In the same week, a delegation from the London-based Global Tamil Forum (GTF) led by Suren Surendiran, a group banned in Sri Lanka, had a meeting with top officials in the US Department of State. A tweet from the Department said: “The US values our relationship with diaspora communities who helped build bridges of understanding between Americans and the rest of the world. Assistant Secretary (David) Lu met with Global Tamil Forum at GTF online to discuss democracy, human rights, and economic challenges in Sri Lanka.”

With the State of Emergency in place, and a 36-hour curfew declared from 6 p.m. Saturday till 6 a.m. tomorrow, the government has already deployed troops district wise. It is determined to ensure no countrywide protests take place today. Thus, the battle lines are clearly drawn between the government and the public who are protesting.

This is whilst considerable international attention is being focused on developments in Sri Lanka, as the following tweets, will indicate:

The US Senate Foreign Relations Committee: Closely monitoring the situation in Sri Lanka. Out of an abundance of caution …..

The European Union: Concerned by the state of emergency, EU strongly urges Sri Lankan authorities to safeguard democratic rights of all citizens, including right to free assembly and dissent, which has to be peaceful. Challenging times for Sri Lankan people- EU continues to follow situation closely….

Sarah Hulton, British High Commissioner in Sri Lanka: Concerned by reports of the use of force against journalists and protesters, and the recently imposed Emergency Laws. A citizen’s right to protest peacefully is an essential part of democracy.

Julie Chung, United States Ambassador in Sri Lanka: Sri Lankans have a right to protest peacefully – essential for democratic expression. I am watching the situation closely, and hope the coming days bring restraint from all sides, as well as much needed economic stability and relief for those suffering.