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Government Weighs Keeping Fuel Prices Unchanged as Global Oil Costs Ease

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Government Weighs Keeping Fuel Prices Unchanged as Global Oil Costs Ease

June 15, Colombo (LNW): The Government is assessing the possibility of maintaining existing fuel prices even after the current fuel assistance programme comes to an end, provided international oil markets continue to show sustained stability and lower prices.

Officials say authorities are carefully tracking developments in global energy markets before making a final determination on whether state support for fuel pricing will be extended, revised or phased out in the coming months.

The fuel relief initiative, introduced earlier this year to cushion motorists and businesses from high fuel costs, currently provides concessions of Rs. 100 per litre on Lanka Auto Diesel and Rs. 20 per litre on Petrol. The programme was backed by a Rs. 57 billion allocation intended to ease pressure on household budgets and transport costs.

Although many consumers expected the subsidy scheme to conclude at the end of June, energy sector officials clarified that the programme is tied to the availability of the allocated funds rather than a specific calendar deadline. As a result, the concessions are expected to remain in place until the designated funding is fully utilised.

Ceylon Petroleum Corporation (CPC) Managing Director Mayura Neththikumara stated that the continuation of the subsidy beyond the current allocation will depend on policy decisions taken by the Government. He noted that the CPC is awaiting official guidance regarding the future direction of the relief programme.

According to industry officials, recent declines in global fuel prices have created a more favourable environment for domestic price stability. International diesel prices, which had previously surged amid geopolitical tensions and supply concerns, have shown signs of moderation, offering some relief to importing nations such as Sri Lanka.

Neththikumara explained that the recent fall in diesel prices on the world market could potentially allow local fuel rates to be maintained at present levels without requiring substantial additional subsidies. However, he stressed that policymakers would need to see a consistent trend rather than a temporary market correction before making long-term pricing decisions.

Energy analysts also caution that fuel pricing cannot be based on short-lived fluctuations. Global oil markets remain vulnerable to geopolitical developments, supply disruptions and shifts in demand, making sustained price stability a key factor in any future policy adjustments.

At present, retail fuel prices remain unchanged, with Lanka Petrol 92 Octane selling at Rs. 434 per litre and Lanka Auto Diesel at Rs. 407 per litre. Premium grades continue to be priced at Rs. 495 per litre for Lanka Petrol 95 Octane and Rs. 478 per litre for Lanka Super Diesel.

Officials indicated that if international fuel prices remain at current levels over an extended period, the Government may have greater flexibility to maintain affordable domestic fuel prices while reducing the financial burden of subsidies on the Treasury.

A final decision on the future of the fuel relief programme is expected after a comprehensive review of global market conditions, fiscal considerations and the remaining balance of the subsidy allocation.

Sri Lanka Braces for Warmer Conditions as El Niño Develops

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Sri Lanka Braces for Warmer Conditions as El Niño Develops

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June 15, Colombo (LNW): Sri Lanka is expected to experience warmer and somewhat drier weather in the months ahead as El Niño conditions continue to develop, although experts say the country is unlikely to face the most severe consequences associated with the global climate pattern.

Climate specialists have indicated that any substantial effects linked to El Niño are not expected to become fully apparent until early next year. Officials note that Sri Lanka’s geographical position within the Indian Ocean, combined with the influence of its central mountainous region, helps retain atmospheric moisture and provides a degree of natural protection against extreme climatic shifts.

Meteorological authorities have nevertheless cautioned that temperatures are likely to remain above seasonal averages during July and August. Rainfall levels may also decline in several parts of the country as the weather phenomenon gains strength, raising concerns about water availability and agricultural productivity.

The potential implications of El Niño were recently reviewed at a high-level discussion attended by senior government officials and chaired by President Anura Kumara Dissanayake.

The meeting focused on possible challenges to food production, drinking water supplies, irrigation systems and electricity generation, particularly if prolonged dry conditions emerge.

Disaster management officials warned that while current forecasts do not point to a severe crisis, authorities must remain prepared for less favourable scenarios. A prolonged drought could place significant pressure on reservoirs, rivers and groundwater resources, especially in regions already vulnerable to water shortages.

Officials noted that contingency plans are being strengthened to safeguard essential services. In a worst-case scenario involving the depletion of major freshwater sources, emergency measures such as large-scale desalination and the distribution of treated seawater could be considered to meet public demand.

Government agencies are also expected to increase monitoring of weather patterns and reservoir levels in the coming months, while encouraging the public to adopt water conservation practices. Experts stressed that although Sri Lanka may avoid the harshest impacts seen elsewhere in the region, early preparedness remains essential to minimise potential disruptions to livelihoods and the economy.

Nationwide Dengue Eradication Drive Launched Amid Rising Health Concerns

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Nationwide Dengue Eradication Drive Launched Amid Rising Health Concerns

June 15, Colombo (LNW): Health authorities have launched a week-long Dengue Prevention Campaign beginning today (15) and continuing until June 20, as concerns grow over the increasing number of dengue cases reported across the country in recent weeks.

The initiative aims to reduce mosquito breeding sites and strengthen public awareness through a coordinated nationwide clean-up programme involving government agencies, local authorities, educational institutions, businesses and residents.

As part of the campaign, extensive cleaning operations will be carried out in public spaces from June 15 to 17. These efforts will focus on urban areas, drainage networks, marketplaces, transport hubs, places of worship and other high-risk locations where stagnant water can accumulate and create ideal breeding conditions for mosquitoes.

On June 18, attention will shift to the education sector, with schools, pre-schools, tuition centres and their surrounding environments scheduled for inspection and clean-up activities. Officials have urged school communities to actively participate in eliminating potential mosquito breeding grounds before the next academic week.

The following day, June 19, will be dedicated to cleaning government offices, private-sector workplaces, industrial facilities and factory premises. Employers have been encouraged to ensure their properties remain free of discarded containers, blocked drains and other areas where water may collect.

The final phase of the campaign, on June 20, will focus on residential neighbourhoods. Householders are being urged to inspect their homes and gardens, clear standing water and maintain clean surroundings to help curb the spread of dengue.

Health officials emphasised that public participation remains critical to the success of the campaign, warning that sustained community action is essential to preventing a further rise in infections during the current rainy season.

Oil Markets Retreat as Prospects of Iran-US Accord Ease Supply Fears

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Oil Markets Retreat as Prospects of Iran-US Accord Ease Supply Fears

June 15, World (LNW): Global oil prices fell sharply at the start of the week, reaching their lowest levels in several months after signs emerged of a diplomatic breakthrough between the United States and Iran, raising hopes of an end to regional tensions that have disrupted energy supplies.

Brent crude dropped by more than four per cent in early trading, while West Texas Intermediate also recorded significant losses as traders reacted positively to reports that the two countries had agreed on a preliminary framework aimed at ending hostilities and restoring normal shipping activity through the strategically vital Strait of Hormuz.

The apparent progress follows months of conflict that severely impacted global energy markets. The closure of the Strait of Hormuz — a key maritime route responsible for transporting a substantial share of the world’s crude oil and liquefied natural gas — removed millions of barrels from international supply chains and fuelled fears of a prolonged energy crisis.

According to diplomatic sources, representatives from Washington and Tehran are expected to formalise the initial agreement during talks in Switzerland later this week. The negotiations have reportedly been facilitated by Pakistan, which has played a mediating role between the two sides.

US President Donald Trump stated that commercial vessels would once again be able to pass through the Strait without additional charges or restrictions, while measures affecting Iranian port access could also be lifted as part of the arrangement.

Iranian media outlets reported that the draft understanding includes a phased reopening of the waterway, with shipping operations expected to resume under a framework overseen by Iranian authorities within the coming month.

Market analysts said the decline in oil prices reflects a rapid reassessment of geopolitical risks. With the possibility of energy exports returning to global markets, investors have begun unwinding positions that had previously been built on expectations of prolonged supply disruptions.

Despite the optimism, uncertainty remains over how quickly oil-producing nations in the Middle East can restore full production and export capacity following infrastructure damage caused by the conflict. Shipping companies are also expected to proceed cautiously before fully returning vessels to the region.

Financial institutions noted that even a partial restoration of traffic through the Strait could be enough to significantly improve supply conditions. Analysts believe that if export volumes recover to around two-thirds of their pre-conflict levels, concerns about shortages could quickly give way to expectations of excess supply.

Meanwhile, Iranian Deputy Foreign Minister Kazem Gharibabadi indicated that broader negotiations would continue during a proposed 60-day ceasefire period, with both sides seeking a more comprehensive settlement.

In a further sign of diplomatic momentum, European powers including Britain, France, Germany and Italy signalled their willingness to consider easing sanctions on Iran if meaningful progress is achieved regarding its nuclear activities.

Nevertheless, market observers cautioned that unresolved issues surrounding future negotiations could limit further declines in oil prices. While confidence has improved markedly, traders remain alert to potential setbacks that could reignite volatility in the energy sector.

CID Rejects Request for Expanded Lawyer Access to Hospitalised Ex-Intelligence Chief Sallay

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CID Rejects Request for Expanded Lawyer Access to Hospitalised Ex-Intelligence Chief Sallay

June 15, Colombo (LNW): The Criminal Investigation Department (CID) has turned down a request seeking increased legal access for former State Intelligence Service (SIS) Director, Major General (Retired) Suresh Sallay, who remains under medical care at the National Hospital in Colombo following a hunger strike launched while being held under a detention order.

The decision was formally conveyed by CID Director Shani Abeysekara in a letter addressed to Sallay’s wife, Manori Sallay, after she appealed for her husband’s legal representative, Attorney-at-Law Asitha Siriwardena, to be permitted to visit him on a daily basis during the working week.

In its response, the CID maintained that there was no compelling requirement for such frequent consultations at present, noting that Sallay is currently receiving treatment in hospital and is not actively participating in any investigative procedures. Officials further argued that routine legal meetings beyond the existing arrangement could interfere with the rest and recovery considered necessary for his medical condition.

The department also highlighted that a standing court directive already allows Sallay’s lawyer to meet him once a week, specifically on Wednesdays, and that this arrangement remains in force.

While declining the request for additional legal visits, the CID confirmed that immediate family members, including Sallay’s wife and children, continue to enjoy daily visitation privileges while he remains hospitalised.

As a result, the request to expand access for legal counsel has been refused, with authorities opting to retain the current visitation framework until further notice.

Showers may continue across Island: Strong winds expected (June 15)

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Showers may continue across Island: Strong winds expected (June 15)

June 15, Colombo (LNW): Several spells of showers will occur in Western, Sabaragamuwa and North-western provinces and in Galle, Matara, Kandy and Nuwara-Eliya districts.

Showers or thundershowers may occur at a few places in Uva and Eastern provinces and in Mullaittivu district after 2.00 p.m.

Fairly strong winds about (30-40) kmph can be expected at times over Western slopes of the central hills, Northern and North-central provinces and in Hambantota and Trincomalee districts.

The general public is kindly requested to take adequate precautions to minimise damage caused by temporary localised strong winds and lightning during thundershowers.

Marine Weather:

Condition of Rain: Showers or thundershowers will occur at several places in the sea areas off the coast extending from Chilaw to Matara via Colombo and Galle.

Winds: Winds will be south-westerly. Wind speed will be (30-40) kmph. Wind speed can increase up to (50-60) kmph at times in the sea areas off the coast extending from Galle to Pottuvil via Hambantota. Wind speed can increase up to 50 kmph at times in the sea areas off the coast extending from Trincomalee to Galle via Kankasanthurai, Puttalam and Colombo.

State of Sea: The sea areas off the coasts extending from Galle to Pottuvil via Hambantota will be rough at times. The sea areas off the coasts extending from Trincomalee to Galle via Kankasanthurai, Puttalam and Colombo will be fairly rough at times.

The wave height may increase about (2.0 – 2.5) meters in the sea areas off the coast extending from Kalpitiya to Pottuvil via Colombo, Galle and Hambantota.

Temporarily strong gusty winds and very rough seas can be expected during thundershowers.

CoPF Reprimands CBSL Oversight Failures in NDB Fraud Case

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CoPF Reprimands CBSL Oversight Failures in NDB Fraud Case

By Adolf

The Parliamentary Committee on Public Finance (CoPF) has expressed strong dissatisfaction with the Central Bank of Sri Lanka (CBSL) over what lawmakers described as significant regulatory and supervisory failures that allowed a massive Rs. 13.2 billion fraud at National Development Bank PLC (NDB) to remain undetected for years.

The matter came under intense scrutiny during a high-profile hearing before CoPF, chaired by MP Harsha de Silva, where Central Bank Governor Dr. Nandalal Weerasinghe and senior officials from the Bank Supervision Department were questioned regarding the circumstances that enabled one of Sri Lanka’s largest known internal banking frauds.

The fraud, allegedly carried out by a low-level employee attached to NDB’s transaction reconciliation unit, is believed to have continued over nearly a decade. Investigators suspect the individual exploited weaknesses in the bank’s reconciliation processes involving the LankaPay electronic fund transfer system, gradually siphoning funds while concealing discrepancies within the bank’s accounts.

Committee members questioned how such a substantial and growing balance could remain hidden within NDB’s financial statements under the category “Other Financial Assets/Receivables” without attracting regulatory concern. Lawmakers noted that the balance had reportedly fluctuated between Rs. 1.5 billion and Rs. 4 billion before eventually expanding to Rs. 13.2 billion.

CoPF members argued that such unusual movements should have triggered immediate attention from the Central Bank’s off-site supervision mechanisms. Several members suggested that the failure to identify these anomalies pointed to broader weaknesses within the regulatory framework.

A key point of contention arose when Director of Bank Supervision R.R.S. De Silva Jayatillake informed the committee that NDB had participated in preparing the initial scope of the forensic investigation. This prompted sharp criticism from Chairman Harsha de Silva, who questioned whether an institution under investigation should have any role in defining the parameters of the inquiry.

“Is the accused being asked to draft the scope of the investigation?” he asked, raising concerns about the independence and credibility of the process.

Governor Weerasinghe defended the procedure, stating that while NDB had provided preliminary input, the Central Bank retained full authority over the final terms of reference and investigative mandate.

The CBSL has engaged Deloitte India to conduct the forensic investigation. According to officials, a six-member specialist team is currently carrying out detailed examinations, with an interim report expected shortly and a final report scheduled for completion by July 18.

The committee also raised concerns regarding potential conflicts of interest. Questions were posed about whether links between a current NDB board member and Deloitte’s local affiliate could create perceptions of undue influence over the investigation.

Central Bank officials assured lawmakers that Deloitte India had provided clear guarantees that its forensic team would operate independently of any local affiliate involvement and that appropriate safeguards were in place to preserve the integrity of the investigation.

Further criticism emerged over the Central Bank’s approval of NDB’s previous debenture issuances aimed at strengthening Tier 2 capital. Committee members argued that regulators appeared to have relied excessively on information supplied by the bank without independently verifying the underlying financial position.

CBSL officials maintained that their approval process focused primarily on compliance with capital adequacy requirements and applicable regulatory standards rather than a detailed audit of financial statements. However, CoPF members rejected that explanation, insisting that regulators must exercise greater vigilance when approving instruments issued to the investing public.

The hearing also highlighted concerns about Sri Lanka’s broader financial regulatory architecture, particularly as the country seeks to strengthen governance standards under ongoing reform commitments. International institutions, including the International Monetary Fund (IMF), have repeatedly emphasized the importance of stronger operational risk management, internal controls and anti-money laundering frameworks across the financial sector.

At the conclusion of the session, CoPF directed the Central Bank to submit all approval and correspondence relating to NDB’s capital-raising activities for further parliamentary examination. The committee indicated that accountability for regulatory shortcomings and failure would remain a key focus once the forensic investigation is completed.

BIA Terminal 2 Revival Gains Momentum after Crucial Talks

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BIA Terminal 2 Revival Gains Momentum after Crucial Talks

By: Staff Writer

June 14, Colombo (LNW): Sri Lanka’s long-stalled Bandaranaike International Airport (BIA) Terminal 2 project appears to be edging closer to revival after a series of high-level discussions between Government officials and representatives of the Japan International Cooperation Agency (JICA), the project’s principal financier.

The discussions, held recently   , brought together Ports, Civil Aviation and Energy Minister Anura Karunathilaka and a Japanese delegation led by Ambassador Isomata Akio. The meeting focused primarily on resolving financial and contractual issues that have repeatedly delayed one of the country’s largest aviation infrastructure developments.

According to officials familiar with the discussions, both sides expressed optimism that construction activities could recommence by November this year if pending approvals are secured without further delay. The project, originally launched with significant expectations, has faced multiple interruptions since work first began.

Sources attending the meeting said the Government pledged to expedite discussions with the Finance Ministry to obtain approval for the additional loan funding required to complete the terminal. Minister Karunathilaka reportedly assured the Japanese delegation that efforts would be made to clear outstanding financial hurdles as quickly as possible.

The meeting was attended by Deputy Minister Janitha Ruwan Kodituwakku, Ministry Secretary W.W.S. Mangala, senior Civil Aviation Authority officials and other ministry representatives, underlining the importance attached to the project by policymakers.

 Significantly, officials revealed that President Anura Kumara Dissanayake has taken a direct interest in the project, recognising its strategic importance to Sri Lanka’s economic recovery and aviation sector. Additional discussions at the highest levels of Government are expected in the coming weeks.

JICA representatives outlined a two-step strategy for moving the project forward. The first phase involves securing the necessary financing arrangements and finalising revised loan agreements. The second phase would focus on awarding construction contracts based on negotiated prices already discussed between stakeholders.

Japanese officials also presented an ambitious completion schedule, indicating that the terminal could be finished within 30 months after construction resumes.

The project was initially launched in December 2020 with financial support from the Japanese Government through a ¥75 billion loan package administered by JICA. However, Sri Lanka’s economic crisis forced construction to halt in April 2022, creating uncertainty over its future.

Although work briefly resumed in 2024, the project encountered another setback in March 2025 when funding shortages once again interrupted progress. Months of negotiations followed, eventually resulting in an agreement to secure additional financing needed to complete the facility.

Industry analysts note that the successful completion of Terminal 2 would significantly increase airport capacity, improve passenger handling capabilities and strengthen Sri Lanka’s ambition to become a regional aviation hub. The project is also viewed as a key component of broader efforts to revive tourism, attract investment and accelerate post-crisis economic growth.

Sri Lanka Unveils Ambitious Export Blueprint for Economic Revival

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Sri Lanka Unveils Ambitious Export Blueprint for Economic Revival

By: Staff Writer

June 14, Colombo (LNW): Sri Lanka is set to launch an ambitious five-year strategy aimed at reshaping its export sector and accelerating economic recovery, with the official unveiling of the National Export Development Plan (NEDP) 2026–2030 scheduled for 16 June in Colombo.

The plan, regarded as one of the most comprehensive export-focused policy frameworks introduced in recent years, seeks to increase national export earnings to an ambitious $36 billion by 2030. Authorities believe the initiative could play a pivotal role in steering the country towards sustainable economic growth following years of financial instability and external shocks.

The NEDP has been developed in line with the Government’s broader vision of creating a prosperous economy and improving living standards. Its formulation was identified as a national priority under the 2025 Budget, reflecting growing recognition that exports must become a key engine of long-term growth.

The Sri Lanka Export Development Board (EDB), with technical support from the Asian Development Bank (ADB), led the development of the framework through the Industry and Entrepreneurship Development Ministry’s policy reform programme. Officials say the strategy was designed to address longstanding weaknesses that have constrained the country’s export competitiveness in global markets.

Central to the plan are two strategic pillars. The first focuses on creating a stronger enabling environment for exporters. Policymakers have identified several structural barriers that have hindered export expansion, including inefficient trade procedures, limited access to finance, supply chain challenges, and gaps in quality standards.

To address these concerns, the framework prioritises trade facilitation, investment promotion, export financing, market access, supply chain consolidation, and internationally recognised quality standards. Environmental, Social and Governance (ESG) compliance has also been incorporated, reflecting increasing global demand for sustainable production practices.

The plan additionally places significant emphasis on developing a skilled workforce, encouraging innovation, and supporting entrepreneurship areas viewed as critical for maintaining competitiveness in rapidly changing global markets.

The second pillar targets eight priority industries identified as having strong export potential. These sectors include auto components, minerals-based manufacturing, rubber-based products, marine industries such as boat and shipbuilding, spices and concentrates, digital products and services, electrical and electronic components, and processed food and beverages.

Officials argue that focusing on these sectors will help diversify Sri Lanka’s export basket, reduce dependence on traditional exports, and encourage greater value addition within the domestic economy.

What distinguishes the NEDP from previous policy initiatives is the breadth of consultation behind its development. More than 300 stakeholders contributed to the process, including representatives from government agencies, private sector organisations, civil society groups, and international development partners.

Supporters believe the extensive consultation process has enhanced the plan’s credibility and practicality. However, economic analysts note that successful implementation will depend on sustained policy consistency, effective coordination among institutions, and the Government’s ability to translate strategic goals into measurable outcomes.

As Sri Lanka seeks to strengthen its position in global trade, the NEDP represents a significant test of whether long-term export-led growth can be transformed from policy aspiration into economic reality.

Government Bets on AI to Drive Economic Transformation

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Government Bets on AI to Drive Economic Transformation

By: Staff Writer

June 14, Colombo (LNW): Rather than resisting the rise of artificial intelligence, Sri Lanka is positioning itself among a growing number of nations seeking to harness the technology as a catalyst for economic growth, productivity enhancement, and institutional reform.

Speaking at the International Labour Conference in Geneva, Labour Minister and Deputy Minister of Finance and Planning Anil Jayantha Fernando outlined the government’s ambitious vision to embed AI at the heart of the country’s development strategy. The initiative comes amid mounting concerns that AI could disrupt jobs worldwide, particularly in professional and administrative sectors.

Fernando argued that Sri Lanka intends to move beyond viewing AI as a threat to employment. Instead, policymakers are promoting what they describe as an “AI-first” strategy aimed at transforming public institutions, businesses, and traditional industries.

“Sri Lanka proposes a shift in this paradigm to start viewing technology and AI as a catalyst to re-architect our production relations to enhance productivity and value generation for shared prosperity,” he said.

Under the proposed framework, AI will be integrated into government operations and economic planning, with the objective of boosting efficiency and competitiveness. Authorities believe the technology can help businesses increase output, support workers in transitioning to higher-value employment, and modernize sectors that have historically recorded lower productivity levels.

The government’s vision extends beyond office environments. Officials argue that AI could play a transformative role in agriculture and the informal economy, sectors that employ a substantial share of Sri Lanka’s workforce. By introducing digital tools and data-driven decision-making, policymakers hope to increase productivity while making these sectors more attractive to younger workers.

Digital transformation has also been identified as a key national priority under President Anura Dissanayake’s administration. Officials see technology-driven growth as essential for expanding export earnings, strengthening economic resilience, and positioning Sri Lanka within the rapidly evolving global digital economy.

However, the government insists that labour protections will remain a central component of the reform agenda. Fernando announced that Sri Lanka ratified ILO Convention No. 190 on violence and harassment in the workplace in May, with legislation currently being finalized. Discussions are also underway regarding ratification of Convention No. 188, which focuses on workers in the fishing sector.

Meanwhile, an expert committee is consulting stakeholders on broader labour reforms designed to balance economic modernization with worker welfare.

Fernando also urged greater international collaboration to address widening digital inequalities, warning that the benefits of AI must not be concentrated among a small group of countries or corporations.

As Sri Lanka accelerates its digital ambitions, the success of its AI-first strategy will depend on whether technological progress can be translated into inclusive growth, better jobs, and shared prosperity. The coming years may determine whether AI becomes a disruptive force—or a powerful engine of national transformation.

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