Pelwatte Dairy Industries Limited has announced a major investment initiative aimed at strengthening Sri Lanka’s dairy industry and improving access to locally produced nutritional products. Through its fully owned subsidiary, Pelwatte Foods Ltd., the company plans to establish a Greenfield Liquid Milk Manufacturing Facility at its Kurunegala plant with an investment of approximately Rs. 1.86 billion.

The investment was officially formalised through an agreement signed with the Board of Investment (BOI) of Sri Lanka on 21 May. The signing ceremony was attended by Pelwatte Dairy Chairman Ariyaseela Wickremanayake, Managing Director Akmal Wickramanayake and BOI Chairman Dr. Sulakshana Jayawardena.

The proposed facility, identified as Phase 01 of the company’s expansion strategy, will focus on producing liquid milk and flavoured milk beverages including chocolate, vanilla, strawberry and iced coffee varieties. According to the company, the plant will be equipped with advanced automated technology and modern processing systems designed to maintain international manufacturing standards while ensuring consistent product quality.

Construction work on the facility is expected to begin in July 2026, while commercial operations are scheduled to commence by July 2027.

For decades, Pelwatte has remained a trusted household brand in Sri Lanka’s milk powder market. The company now aims to expand its footprint into the liquid milk sector while providing consumers with more accessible and diverse nutritional choices.

Company officials stated that the investment is expected to contribute significantly towards strengthening local dairy production capacity and reducing the country’s dependence on imported dairy products. The project is also expected to support food security initiatives by increasing the availability of high-quality dairy products produced locally.

Despite the plant’s highly automated operations limiting direct employment opportunities, the project is expected to create indirect economic benefits across the dairy supply chain. Increased demand for locally sourced raw milk is expected to provide support to dairy farmers and related industries.

Pelwatte representatives described the project not merely as a commercial expansion, but as a long-term investment in the health and wellbeing of Sri Lanka’s population. The company emphasised that improving access to nutritious, protein-rich dairy products can play an important role in addressing nutritional challenges affecting mothers and children.

The investment comes at a time when malnutrition continues to remain a serious public health concern in Sri Lanka. Health data indicates that a considerable number of babies are born with low birth weight, while anaemia among women of reproductive age and undernutrition among children continue to pose challenges nationwide.

Experts note that ensuring better maternal nutrition during pregnancy and improving access to quality food sources are essential measures in reducing long-term health risks for both mothers and children.

With construction scheduled to begin in mid-2026, the Kurunegala facility is expected to further strengthen Pelwatte’s position as a leading player in Sri Lanka’s dairy sector while contributing towards national nutrition and food security goals.

A deepening divide has emerged between Sri Lanka’s entrepreneurial sector and the National People’s Power (NPP) Government, as business leaders accuse authorities of failing to honour promises made to protect local industries and support economic recovery. Entrepreneurs now warn that flawed policies and foreign-influenced economic decisions are placing domestic businesses in jeopardy at a time when the country can least afford further instability.

The latest criticism came from the Sri Lanka United Business Alliance (SLUBA), which claims the Government has neglected the concerns of local entrepreneurs despite repeated assurances during the election campaign. Addressing the media in Colombo, SLUBA President Tania Abeysundara described the situation facing businesses as increasingly dangerous and unsustainable.

She stated that entrepreneurs who contributed significantly to sustaining Sri Lanka’s economy during periods of crisis now feel abandoned by policymakers. According to her, many businesses entered 2025 expecting stronger industrial protection and clearer economic direction under the NPP administration. Instead, entrepreneurs say they are confronting worsening uncertainty and policy confusion.

Abeysundara warned that the absence of consistent policy frameworks has damaged investor confidence and weakened local industries already struggling with inflation, taxation, and reduced consumer spending. She argued that Government decisions are creating barriers for domestic enterprises while failing to address the influx of competitive imports that threaten local production.

One of the alliance’s strongest criticisms focused on monetary policies introduced to stabilise the US dollar and restore financial confidence. Entrepreneurs argue that higher interest rates have severely restricted access to capital, making expansion and survival increasingly difficult for small and medium-scale enterprises.

Many local manufacturers now face a dangerous combination of rising operational expenses and declining market demand. Business owners claim they are struggling to maintain production levels while coping with energy costs, import expenses, and limited access to affordable credit facilities.

SLUBA member Mahendra Jayasekara challenged official narratives suggesting the economy is steadily recovering. He argued that the Government’s optimistic economic messaging does not reflect conditions experienced by entrepreneurs operating across the country.

Jayasekara further alleged that economic policy decisions are being shaped excessively by international financial institutions such as the International Monetary Fund (IMF), World Bank, and Asian Development Bank (ADB). According to him, relying heavily on external policy prescriptions without understanding local economic realities could produce long-term damage to domestic industries.

He warned that Sri Lanka risks repeating past mistakes if policymakers continue ignoring the voices of entrepreneurs who possess practical business experience and direct understanding of market conditions. Economic recovery, he argued, cannot be achieved solely through fiscal reforms and international agreements while local industries continue weakening.

The growing frustration among entrepreneurs signals broader anxiety within Sri Lanka’s private sector. Many business leaders fear the country’s recovery strategy is becoming disconnected from domestic economic priorities and overly focused on satisfying international financial benchmarks.

Analysts believe that without urgent intervention to restore business confidence, strengthen industrial protections, and create clearer policy direction, Sri Lanka could face slower growth, rising unemployment, and declining entrepreneurial investment. For many local entrepreneurs, the promised economic transformation under the NPP Government now appears increasingly uncertain.

Sri Lanka’s decision to formally permit foreign money transfer companies to register and operate under revised regulations has triggered fresh debate over financial oversight, regulatory enforcement, and the future control of the country’s rapidly evolving remittance market.

The Cabinet of Ministers earlier this week approved sweeping amendments aimed at strengthening supervision of money and value transfer service providers while closing legal loopholes that had allowed several overseas operators to function through local representatives without direct regulatory approval.

The reforms come under the Payment and Settlement Systems Act, No. 28 of 2005, and revise key sections of the Payment or Value Transfer Service Providers Regulations No. 1 of 2024.

Under the earlier regulatory framework, only firms incorporated under Sri Lanka’s Companies Act, No. 07 of 2007, qualified for registration. The restrictions effectively barred foreign-registered entities, offshore companies, and companies limited by guarantee from securing legal operating status within Sri Lanka.

However authorities discovered that many international remittance service providers continued servicing Sri Lankan customers through agency arrangements and local partnerships despite lacking formal registration.

Regulators viewed this as a growing compliance threat, particularly as cross-border digital transactions and online payment systems expanded at unprecedented speed.

Financial investigators and policy experts warned that the situation created blind spots in monitoring financial flows, potentially weakening Sri Lanka’s safeguards against money laundering, illicit financial transfers, and terror financing activities.

In response, the government introduced the Money or Value Transfer Service Providers Regulations No. 1 of 2025 through Extraordinary Gazette No. 2468/06 dated 23 December 2025.

The revised regulations now permit foreign money transfer operators to apply for registration directly, subject to compliance with local supervisory and reporting requirements enforced by the Central Bank of Sri Lanka.

Officials argue the move will help integrate all transfer operators into a unified monitoring structure, improving accountability and reducing risks linked to unregulated payment activities.

The policy shift also reflects mounting pressure on Sri Lanka to align its financial governance standards with international Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) obligations at a time when global scrutiny over cross-border transactions continues to intensify.

Economists say the timing is significant. Sri Lanka remains heavily dependent on worker remittances as a vital source of foreign exchange inflows, making the efficiency and credibility of formal remittance channels a major national economic priority.

Authorities hope the revised framework will encourage migrant workers and overseas Sri Lankans to increasingly use licensed digital transfer platforms instead of informal underground networks that bypass banking systems entirely.

However, some observers caution that allowing foreign operators into the regulated system may also increase competitive pressure on local financial service providers and create new supervisory challenges for regulators already struggling with enforcement capacity.

The proposal was presented by President Anura Kumara Dissanayake in his role as Minister of Finance, Planning and Economic Development, signalling the government’s intention to tighten financial governance while modernising Sri Lanka’s payment infrastructure in line with global regulatory expectations.

IMF Deputy Managing Director and Acting Chair Kenji Okamura says the progress achieved through Sri Lanka’s ongoing economic reform programme has strengthened the country’s economic resilience despite global and domestic challenges.

In a statement issued following the completion of the combined Fifth and Sixth Reviews of Sri Lanka’s economic reform programme under the Extended Fund Facility (EFF), Okamura stated that the reforms had helped preserve economic stability and provided room for the country to respond to the impacts of Cyclone Ditwah and the Middle East conflict.

“Sri Lanka’s strong implementation under the EFF arrangement has continued despite challenging circumstances,” Okamura said.

The successful completion of the combined reviews unlocks approximately US$ 695 million in financial assistance, bringing total IMF disbursements to Sri Lanka to around US$ 2.4 billion since the programme began.

Okamura noted that while the reform programme had improved resilience, the ongoing Middle East conflict has significantly worsened Sri Lanka’s economic outlook and increased downside risks.

“For 2026, growth is projected to slow down to 3 percent. Higher oil prices would increase inflation and weaken the current account, which would also be adversely impacted by lower tourism receipts,” he stated.

He further noted that uncertainty regarding the intensity and duration of the conflict has heightened risks to the country’s economic outlook.

The IMF Executive Board originally approved the EFF arrangement for Sri Lanka on March 20, 2023, amounting to SDR 2.286 billion, or approximately US$ 3 billion.

According to the IMF, the programme is aimed at restoring macroeconomic stability through measures including restoring fiscal and debt sustainability, protecting vulnerable groups, safeguarding price and financial sector stability, rebuilding external reserves, strengthening governance, reducing corruption vulnerabilities, and advancing growth-oriented structural reforms.

The statement further noted that fiscal easing in 2026 was appropriate in response to recent shocks, with the Government implementing a temporary relief package and allocating additional spending for recovery and reconstruction efforts following Cyclone Ditwah.

Okamura stated that from 2027 onwards, authorities remain committed to returning to the primary balance target of 2.3 percent of GDP and complying with expenditure ceilings.

While describing overall programme performance as generally strong, he stressed that further efforts are needed to complete reforms related to public financial management, investment management, and the electricity sector.

He also emphasized that sustained revenue mobilisation remains essential to improve the efficiency of the tax system and support economic growth, including through the development of a medium-term revenue strategy.

Although Sri Lanka’s debt restructuring process is nearing completion, Okamura warned that debt sustainability risks remain high.

Sri Lanka Police say steps are underway to bring back 89 organised criminals currently hiding overseas after being issued Interpol Red Notices.

Addressing a special police press conference yesterday (May 28), Police Media Spokesman ASP F.U. Wootler stated that many of the suspects are allegedly involved in organised crime and drug trafficking operations targeting Sri Lanka.

He revealed that eight suspects hiding in the United Arab Emirates (UAE) were repatriated to Sri Lanka on Wednesday (May 27) following coordinated intelligence operations.

According to the Police Spokesman, the suspects had been arrested and detained in Dubai and Sharjah over serious criminal offences.

ASP Wootler further stated that another 21 suspects — including 19 men and two women — had been repatriated from the UAE on May 22 and are currently being investigated by specialised police units.

“We took steps to bring these eight suspects from the UAE to Sri Lanka through an intelligence operation. Three of these suspects have been identified as a group maintaining close ties with organised criminals and carrying out certain crimes in Sri Lanka while operating from abroad. Two suspects are involved in large-scale drug trafficking, while three others are linked to various criminal activities in the country,” he said.

He stressed that authorities would not allow individuals involved in crimes in Sri Lanka to evade justice by operating from foreign countries.

“We emphasise once again that we will not allow anyone who commits crimes in this country to go to different countries, evade justice, and continue criminal activities while in hiding,” he stated.

ASP Wootler noted that during the years 2024, 2025, and 2026, Sri Lanka Police had already repatriated 32 suspects through Interpol Red Notices, while an additional 70 suspects had been brought back through cooperation with foreign countries.

“We must also remind that Sri Lanka Police are clearly prepared regarding 89 more Red Notices. We will bring back the remaining 89 suspects to Sri Lanka by working together with various countries,” he added.

Prime Minister Dr. Harini Amarasuriya says Sri Lanka’s strength lies in its position as an open, reliable, and constructive partner committed to regional cooperation and international engagement.

The Prime Minister made these remarks while attending the main conference of the Sri Lankan-German Business Forum 2026 as Chief Guest yesterday (May 28) at ITC Ratnadipa, Colombo, according to the Prime Minister’s Media Division (PMD).

Organised by the Delegation of German Industry and Commerce in Sri Lanka (AHK Sri Lanka) with the support of the German Embassy in Colombo, the three-day forum aims to promote Sri Lanka as an attractive destination for foreign direct investment (FDI), particularly in the maritime and logistics sectors.

The conference brought together government officials, international experts, and corporate leaders for discussions on maritime development, export competitiveness, infrastructure financing, and investment opportunities.

During the event, the official invitation for the Asia Pacific Conference 2026 was presented to Prime Minister Amarasuriya by the German delegation together with the Ambassador of the Federal Republic of Germany to Sri Lanka and the Maldives, Dr. Felix Neuman.

Addressing the forum, the Prime Minister highlighted the longstanding partnership between Sri Lanka and Germany, noting that cooperation between the two countries extends across tourism, trade, investment, technology transfer, development cooperation, and private sector collaboration.

She also acknowledged Germany’s longstanding contribution to Sri Lanka’s development, particularly in technical and vocational education, renewable energy, and development cooperation.

According to the PMD, the Prime Minister stated that Sri Lanka is currently undergoing a period of economic recovery and reform aimed at restoring macroeconomic stability and restructuring the economy towards a more resilient and competitive model.

“The Government has undertaken a comprehensive programme of fiscal consolidation, structural adjustments, and governance reforms directed towards long-term economic sustainability,” she said.

She also noted that while such reforms are intended to ensure stability and growth, they carry social impacts that must be carefully managed, particularly for workers, women, and vulnerable communities.

Highlighting Sri Lanka’s strategic position in the Indian Ocean, the Prime Minister said the country’s ports, airports, skilled workforce, and improving investment climate continue to strengthen its role as a regional hub connecting East and West.

She further stated that Sri Lanka’s improving performance in global governance and transparency indicators reflects ongoing efforts to strengthen accountability, institutional integrity, and good governance, which are key to enhancing investor confidence.

Emphasising Sri Lanka’s commitment to expanding international economic engagement, Prime Minister Amarasuriya invited the German business community to further strengthen partnerships with Sri Lankan counterparts.

The event was attended by German Ambassador Dr. Felix Neuman, Chief Delegate of AHK Sri Lanka Martin Klose, Deputy Ministers, government officials, international experts, and members of the business communities of both countries.

The Government is moving ahead with plans to introduce a public-private partnership (PPP) model for SriLankan Airlines, according to Aviation Minister Anura Kuranathilake.

Speaking during a televised discussion, the Minister acknowledged that maintaining the national carrier using taxpayer funds is becoming increasingly unsustainable.

He stated that the Government is currently required to provide substantial financial assistance to keep the airline operational, revealing that around Rs. 90 billion is expected to be allocated up to 2030 at a rate of nearly Rs. 30 billion annually.

According to the Minister, SriLankan Airlines has also requested an additional Rs. 10 billion to continue operations.

“This cannot continue forever. It is unfair because even people who have never seen an aircraft are contributing through their taxes to maintain the airline,” he said.

Minister Kuranathilake stated that the Government has now decided to pursue a public-private partnership model and is currently preparing investment proposals to invite investors.

He added that a separate institution would be assigned to manage the investor process and expressed confidence that investments could be secured within this year.

However, the Minister clarified that the Government does not intend to fully privatise SriLankan Airlines.

He stressed that maintaining some level of State involvement in a national carrier remains important, particularly during emergencies.

As examples, he referred to SriLankan Airlines’ role in repatriating Sri Lankan students stranded in China during the COVID-19 pandemic and arranging special flights for Sri Lankan schoolchildren stranded in India following a highway accident.

“We believe there should be at least some level of Government involvement in a national airline for emergency situations,” he said.

The Minister further noted that the Government hopes to retain existing State assets within the airline while introducing private investment under a joint partnership structure.

Colombo Mayor Vraie Cally Balthazaar has clarified reports claiming that the Inland Revenue Department (IRD) had initiated legal action against the Colombo Municipal Council (CMC) over tax defaults.

In a statement shared on social media, the Mayor said the matter relates to delays in Value Added Tax (VAT) payments for the period between 2016 and 2020.

According to Balthazaar, the IRD has claimed outstanding taxes amounting to Rs. 483 million, along with penalties totalling Rs. 551 million.

She stated that the liabilities had arisen due to late payment charges and the rejection of input tax claims after relevant information was not submitted within the required timeframe.

“We will continue discussions with the Inland Revenue Department regarding the settlement of these liabilities that arose due to delays prior to the new government assuming responsibility for the CMC,” the Mayor said.

Balthazaar further noted that all taxes due from the third quarter of 2025 onwards had been paid on time without delays or additional penalties.

Showers or thundershowers will occur at times 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 province and in Ampara and Batticaloa district after 1.00 pm.

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

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