Commander of the United States Indo-Pacific Command (INDOPACOM), Admiral Samuel J. Paparo, reaffirmed the U.S. commitment to strengthening bilateral ties with Sri Lanka and expressed support for the country’s new governmental policies during a meeting with President Anura Kumara Dissanayake at the Presidential Secretariat on March 21.
Admiral Paparo extended his best wishes to President Dissanayake and the new administration, highlighting Sri Lanka’s crucial role in ensuring security in the Indian Ocean Region and maintaining a peaceful maritime environment.
President Dissanayake expressed gratitude for the United States’ assistance in developing human resources within Sri Lanka’s defence sector, recognizing the continued support provided over the years.
The meeting was attended by Foreign Minister Vijitha Herath, Senior Additional Secretary to the President Roshan Gamage, U.S. Ambassador to Sri Lanka Julie Chung, Lieutenant Colonel Anthony C. Nelson of the U.S. Army, and Senior Foreign Policy Advisor to INDOPACOM David Ranz.
The Election Commission introduced a new mobile application, EC EDR, on March 22 to facilitate the filing of complaints related to local government elections.
The app provides the public with a formal and technologically advanced platform to report election-related issues. It enables users to submit complaints, track their status, and upload video or photo evidence to support their claims.
Election Commission Chairman R.M.A.L. Ratnayake stated, “If the public has a complaint, they can now file it through this app. Additionally, users can track the status of their complaints.”
This initiative aims to enhance transparency and efficiency in addressing election-related concerns, ensuring a more accountable electoral process.
The Easter Day Carnage that targeted Churches and Hotels was the biggest catastrophe in recent history of the country outside the Ethnic war. I have forwarded many analytical presentations on the carnage as a Catholic having closely followed the events since the date of the massacre and made prediction that the main conspirators behind the attack whom we wish to call ‘Maha Molakarus’ will be left to remain incognito and none will be charged with indictment to face justice of the law of the land. I also make prediction that the current Marxist coloured Government despite better efforts will be unable to make much headway without concrete proof of involvement of those suspected and the underlying complexities of foreign involvement wrapped so far by amateurish governance. President AKD may be sincere in his efforts but seems to lack effective managerial support.
The Government of Gotabaya Rajapakse was clearly sidetracking action in catching the conspirators and meting out justice for the victims which intention was clearly on the wall from the beginning which His Eminence Malcolm Cardinal Ranjith failed to see. It is important to digest the ground situation on the camaraderie and relationship among our diverse communities. Despite the so called brotherhood among diverse religious communities in the country the fact is Christianity and Christians remain the cynosure of hate and jealousy, most especially of the Buddhist majority with a few negligible exceptions. This fact should be understood by our Church leadership to tread carefully mindful of pitfalls and quick sand when challenging a rock hard government in power. We have had such experiences in the past since 1956.
THE NON ALIGNED POLICY OF THE CHURCH
The Colombo Diocese founded in 1845 was considered the flagship of the Church in Sri Lanka and Archbishop the leader. Thomas Cardinal Cooray was the first Sri Lankan Archbishop of the Diocese installed in 1947 ending his term in 1976. The Church leadership of the Archbishops of the past prior to Cardinal Ranjith becoming Archbishop in 2009 was very circumspect in its liaison with political leadership of the country maintaining a healthy balance and distance. The Church leaders certainly had their political colourings but it remained strictly private and personal. They provided leadership at the most difficult and challenging periods firstly under the Bandaranaikes with Nationalizations, the takeover of our schools and land later the ethnic war.
So much so the Catholic Church earned immense respect for its firm and dignified stand on politicians and politics. Archbishops Thomas Cardinal Cooray, Nicholas Marcus Fernando and Oswald Gomis are still revered and respected for what they were in most astutely and religiously guiding and serving their flock.
MISTAKES OF THE CHURCH LEADERSHIP & FALLOUTS
It is a majority opinion that Archbishop Malcom Cardinal Ranjith went beyond the line of his eminent predecessors. Some speak of his strong outer manifestations of inner feelings for socialist likings from his early age. Aspersions were galore on the Cardinal on his pattern of behavior before and after the Presidential Election held on 16th November 2019 where he openly supported Gotabhaya Rajapakse and lately that of 21st September 2024 helping a Marxist candidate Anura Dissanayake to be President.One may come to the defense of the Cardinal stating that he supported both believing early Justice for the victims of the Easter carnage but he has failed by miscalculation or otherwise. And in that context with lessons learnt in the past he now needs to be wise changing the Church stance from being antagonist to coercive diplomacy having last felt the punches of irritated Gotabaya when President.
Gota targeted the base and foundation of religious activity in the Archdiocese which is mainly in the Negombo belt. His Muturajawela Gazette was a salvo against the Church. Churches with its land and the Catholic households in the area clearly becoming the main targets. State Media began witch hunting the Clergy. Gota then appointed Gnanasara Thero as Chairman of the Task Force for the implementation of his concept ‘One Country One Law’. Gnanasara Thero stance against the Catholic Church was well known. He visited Madhu area to inquire into a land ownership matter against the Madhu Church Authorities on the invitation of a Tamil politician Sri Ranga.
Gnanasara bared his stance on admissions to schools of religious base. Wholly an attempt to admit non-Catholics in numbers to Catholic schools to upset the balance in a new Constitution set to be drafted. If admissions are to be on a proportionate or pro rata basis Catholic children seeking religious atmosphere would suffer with a Buddhist or other religious majority occupying Catholic schools. And Gota on purpose failed to nominate any Catholic to the Committee to represent Catholic interests. Then came the Bopitiya Church fiasco with some Naval Officers of the Welisara Camp warning the Parish Priest of a Bomb threat and to be vary of persons in Cassocks, the threat to be subsequently withdrawn by the Defense Secretary himself stating it as mistake. Then we had the Borella Church bomb incident fizzling out to be a hoax after some innocent and respected Catholics being remanded on false charges.
The Cardinal clearly seems to be wholly obsessed with the punishment of the fiends behind the Easter Day massacre and not with other large matters related to the wide welfare and the Status quo and future of the Church in the country. He needs to think beyond the Colombo Archdiocese and the damage that could be perpetrated on the wide and future interests of the Catholic Church in the country. It becomes important that he realizes that he is gambling staking a minority fraction of the population against a powerful Marxist Regime and the traumatic experiences the Church underwent especially under Marxist backed Sirimavo government. Cardinal’s needs to evaluate himself and the clout he carries which is truthfully below par in confronting the powerful Marxist Regime. It is no trivial matter of what others are thinking as to how one person’s behavior as the leader could affect the Catholic Church as a whole in the context of Christians being a minority in the country.
ENSURING A FUTURE FOR CHRISTIANS
The Cardinal clearly seems to be wholly obsessed with the punishment of the fiends behind the Easter Day massacre and not with other large matters related to the wide welfare and the Status quo and future of the Church in the country. He needs to think beyond the Colombo Archdiocese and the damage that could be perpetrated on the wide and future interests of the Catholic Church in the country. It becomes important that he realizes that he is gambling staking a minority fraction of the population against a powerful Marxist Regime and the traumatic experiences the Church underwent especially under Marxist backed Sirimavo government. Cardinal’s needs to evaluate himself and the clout he carries which is truthfully below par in confronting the powerful Marxist Regime. It is no trivial matter of what others are thinking as to how one person’s behavior as the leader could affect the Catholic Church as a whole in the context of Christians being a minority in the country.
Showers or thundershowers will occur at several places in Western, Sabaragamuwa and Central provinces and in Galle, Matara, Kurunegala and Mannar districts after 2.00 p.m. Fairly heavy showers above 50 mm can be expected at some places in Western and Sabaragamuwa provinces and in Galle and Matara districts.
Several spells of showers may occur in Uva province and in Ampara, Batticaloa and Hambanthota districts.
Misty conditions can be expected at some places in Western, Sabaragamuwa and Central provinces and in Galle, Matara and Kurunegala districts during the morning.
The general public is kindly requested to take adequate precautions to minimize damages caused by temporary localized strong winds and lightning during thundershowers.
March 23, Colombo (LNW): Sri Lanka has introduced a 15% tax on earnings from service exports, including those made by freelancers and individuals providing services to international clients.
This tax, which will come into effect on April 1, 2025, will apply to individuals as well as corporations, marking a shift from the previous exemption for foreign exchange earnings.
The new tax aims to bring such earnings into the formal banking system, which had been encouraged to remain tax-exempt for foreign currency inflows in the past.
The tax is part of a broader set of amendments to Sri Lanka’s Inland Revenue Act. Under these changes, individuals’ foreign exchange earnings, including those from services rendered outside Sri Lanka, will be subject to a 15% tax if the payments are received in foreign currency and remitted through the banking system. Previously, these foreign earnings had been exempt to encourage the inflow of foreign currency.
Sarah Afker, the Head of Tax Services at BDO Sri Lanka, explained that the tax will be applicable on service exports where payment for services is received from foreign clients and remitted through a bank.
This includes professionals such as IT freelancers and consultants who offer services to clients abroad. These individuals will now be subject to the 15% tax, which will replace the previous exemption that applied to foreign-source income.
The budget also outlines adjustments to the personal income tax structure. For example, income up to 1.8 million rupees is tax-exempt, while the next 500,000 rupees is taxed at 6%. The previous 12% tax rate has been removed, and the next income slab is taxed at 18%. However, foreign exchange earnings will be taxed at a flat 15%, with no upper limit, which is higher than the 6% rate applied to domestic earnings.
This amendment is part of Sri Lanka’s ongoing efforts to align with international tax practices, particularly in response to recommendations from the International Monetary Fund (IMF). The IMF had initially proposed a 30% tax on service exports, but this was negotiated down to 15% as part of the country’s economic reforms.
The IMF has long played a role in advising Sri Lanka on economic matters, particularly during periods of fiscal crises. The country has faced numerous financial challenges, including currency and inflation issues, often exacerbated by ad hoc tax policy changes and monetary policies that have led to foreign exchange shortages.
Experts note that Sri Lanka’s frequent reliance on IMF assistance dates back to the 1960s when the government resorted to printing money to manage fiscal deficits, a practice that has continued, leading to repeated currency crises. These crises have been triggered by policies aimed at suppressing interest rates and maintaining an abundant reserve regime, resulting in excess liquidity in the market.
As Sri Lanka prepares for the new tax regime, the changes are expected to affect a wide range of professionals and businesses involved in exporting services to foreign markets. The move reflects the government’s efforts to secure foreign currency and stabilize the economy, though it may face criticism from those who view such tax hikes as detrimental to the country’s economic recovery efforts.
March 23, Colombo (LNW): Sri Lanka’s economic recovery, supported by the International Monetary Fund (IMF), is on an ambitious yet achievable path, according to IMF officials Peter Breuer and Martha Tesfaye Woldemichael. Despite significant progress, they stressed the importance of maintaining reform momentum to ensure long-term economic stability for current and future generations.
In a joint statement, the IMF officials highlighted that while Sri Lanka’s road to sustainable growth and fiscal health is challenging, it remains achievable through continued reform efforts.
They emphasized that the country must avoid policy errors and maintain essential government services by boosting tax revenues, limiting exemptions, and ensuring that public resources are spent wisely. This includes adopting cost-recovery pricing for fuel and electricity while ensuring targeted social support for the most vulnerable.
As Sri Lanka reaches the midpoint of its four-year reform program, substantial gains have already been made. The economy has bounced back with a 5% growth in 2024, recovering nearly half of the output lost between 2018 and 2023. Inflation has been controlled, tax revenues have increased significantly, and the government’s primary balance has improved.
The IMF acknowledged the relief provided by external creditors, who have forgiven $3 billion in debt and restructured $25 billion, easing the financial burden on the country. This debt relief, along with a favorable response in international markets, has contributed to improved economic conditions. Domestic borrowing costs have dropped sharply, and Sri Lanka’s credit rating has been upgraded.
However, the IMF officials pointed out that past policy mistakes, including low taxes and extensive exemptions benefiting businesses over individuals, led to the current crisis. While the government now has the ability to fund essential services, Sri Lankans are bearing the costs through higher taxes and the elimination of subsidies on fuel and electricity.
These measures are crucial to ensure long-term economic recovery and prevent a return to the severe conditions of 2022.
The IMF’s support has played a crucial role in mitigating the worst effects of the crisis, offering a credible framework for continued reform and attracting financing from other international partners. The program also reassured creditors that Sri Lanka will be able to manage its debt post-restructuring.
Following the elections, the IMF worked with the new government to adjust the program in line with policy priorities. This included adjustments to the tax regime, wage increases for public sector employees to offset past inflation, and some relief for consumers of dairy products. These steps, alongside continued revenue mobilization, have helped the government balance fiscal responsibility with public relief.
As Sri Lanka moves forward, the IMF urges continued commitment to reforms to avoid past economic cycles of boom and bust. Ensuring that the recovery is sustainable in an uncertain global environment is critical to ensuring that all Sri Lankans can benefit from the country’s economic recovery.
March 23, Colombo (LNW): Sri Lanka’s central bank has reduced its back-door money printing operations, as confirmed by opposition legislator Rohini Kaviratne.
She thanked the central bank for curbing liquidity injections through open market operations. Kaviratne had previously revealed in Parliament in October 2024 that 100 billion rupees had been printed covertly, prompting a shift in the central bank’s monetary policy.
The central bank has restricted its practice of injecting money into the interbank market through low-rate, short-term operations (7-day and 14-day). Kaviratne’s revelations sparked a national conversation about the central bank’s open market operations, leading to changes in the way liquidity is managed.
The central bank has also terminated the use of printed money in its domestic operations, although liquidity continues to rise from unsterilized dollar purchases.
In the first quarter of 2025, excess liquidity in the money markets increased due to dollar purchases, following a decline in private credit.
This allowed economists to retract the printed money. While some analysts warn that unsterilized dollar purchases could cause depreciation without an exchange rate target, others argue that claims suggesting the central bank is banned from printing money under the new monetary law are unfounded.
They stress that no central bank with a policy rate is completely prevented from printing money, which can destabilize a country.
Critics also note that a single policy rate regime with excess liquidity, unlike a corridor system for liquidity adjustment, is a worse approach. In the past two quarters, the central bank has increased swaps to inject liquidity into the domestic market, artificially lowering rates, similar to printing money.
These operations, unrelated to credit market conditions, are seen as another means of affecting money supply.
Since October 2024, about 40 billion rupees in excess liquidity have flowed into the Treasury markets, driven by confidence in the country’s exchange rate management.
While short-term capital inflows based on exchange rate confidence are considered a legitimate source of capital, critics argue that in a country with a flawed monetary regime, such inflows can destabilize the economy.
Sri Lanka’s exchange rate conflicts and the use of exchange controls may worsen external instability if rates are mis-targeted, as was the case from 2015 to 2019.
The central bank’s actions have sparked comparisons to historical financial crises, such as the Mississippi Bubble in France, where indiscriminate liquidity injections led to severe economic consequences. Critics warn that similar mismanagement of monetary policy in Sri Lanka could have far-reaching impacts on its economic stability.
March 23, Colombo (LNW): Sri Lanka is set to commence work on a joint solar power project with India during Indian Prime Minister Narendra Modi’s visit on April 5, according to President Anura Kumara Dissanayake.
The project, located in Sampur, is a collaboration between India’s National Thermal Power Corporation (NTPC) and Sri Lanka’s Ceylon Electricity Board (CEB). A power purchase agreement has been signed at a rate of 5.97 US cents per unit, ensuring electricity supply to the national grid.
Originally, the NTPC and CEB had planned a 500 MW coal power plant at the same location. However, the project was abandoned due to various challenges just before international tenders for turbines were to be issued. Instead, Trincomalee is now being developed as an energy hub, with the solar project forming a key part of this initiative.
The proposed 50 MW solar power plant in Sampur has faced delays due to pending approvals for the energy transmission line and finalization of power purchasing agreements (PPAs). Although the Sri Lanka Sustainable Energy Authority (SLSEA) has already issued the necessary energy permit, the CEB still needs to complete the purchasing agreements before construction can begin.
In 2022, India’s NTPC and the CEB signed an agreement to jointly establish the solar plant, marking a decade since a previous agreement for a coal power plant was scrapped. However, despite nearly a year passing since the signing, physical progress on the project remains slow.
A recent meeting of the India-Sri Lanka Joint Working Group (JWG) on power sector cooperation, held on February 28, 2024, focused on critical energy initiatives, including the Sampur solar project and plans for power grid interconnection between the two countries.
The Indian delegation included officials from multiple ministries and power sector agencies, while the Sri Lankan side was represented by the Ministry of Power and Energy, the CEB, and the Ministry of Foreign Affairs.
The discussion emphasized the importance of the power grid interconnection, which would allow Sri Lanka to initially import electricity from India at lower costs and, in the future, export power once its offshore wind energy potential is developed. This grid link is expected to attract private investment in Sri Lanka’s power sector, enabling increased power capacity for both domestic use and export.
Both countries acknowledged the substantial progress made on the Sampur project following President Dissanayake’s visit to India in July 2023, during which an energy permit was granted to the implementing agency, Trincomalee Power Corporation Limited. The meeting concluded with an agreement to finalize necessary contracts within a set timeframe to accelerate project implementation.
Additionally, India agreed to provide technical assistance to the CEB in various energy-related areas, as identified by Sri Lanka. The JWG, which last convened in June 2019, aims to further strengthen bilateral cooperation in the energy sector.
March 23, Colombo (LNW): The Matara Magistrate’s Court has directed that four individuals arrested in connection with the recent fatal shooting in Devinuwara remain in custody for further questioning until March 29.
Amongst those detained is a woman, as authorities continue to unravel the circumstances surrounding the attack.
The suspects were presented before the Acting Magistrate of Matara, who approved their continued detention as investigations progress. The shooting, which occurred on March 21 at approximately 11.45 p.m. near the southern entrance of the Devinuwara Sri Vishnu Devalaya on Sinhasana Road, resulted in the deaths of two individuals.
Police inquiries have pointed to the involvement of notorious underworld figure Shehan Sathsara, alias Bale Malli, as the mastermind behind the attack. Reports indicate that he is currently in hiding in Dubai.
The victims, identified as 29-year-old Pasindu Tharaka and Yomesh Nadeeshan, were both local residents and had been returning home from a birthday celebration in Kapugampura when they were ambushed.
Investigations suggest that the attack stemmed from an ongoing feud between the victims and Bale Malli. According to police, a group of armed assailants in a van deliberately rammed the motorcycle carrying Tharaka and Nadeeshan before opening fire with a T-56 assault rifle and a pistol.
The victims succumbed to their injuries at the scene, while the attackers swiftly fled.
Following the incident, law enforcement officers recovered 39 T-56 bullet casings and two 9mm bullet casings from the crime scene.
The van used in the attack was later found abandoned and set ablaze approximately 800 metres away, in an apparent effort to destroy evidence.
Police continue to intensify their investigation, focusing on tracking down those responsible, particularly Bale Malli, whose overseas whereabouts present a challenge to law enforcement.
March 23, Colombo (LNW): Sri Lanka’s President Anura Kumara Dissanayake revealed on Friday that Indian Prime Minister Narendra Modi is scheduled to visit the island nation on April 5.
The announcement was made during Dissanayake’s speech in the Sri Lankan Parliament.
During his address, President Dissanayake emphasised that Modi’s visit would serve to formalise several agreements that were initially discussed during his trip to New Delhi in 2024.
A key aspect of the visit will be the commencement of the long-awaited construction of the Sampur power plant in the northern port city of Trincomalee.
This development marks a significant step in Sri Lanka’s renewable energy efforts and its ongoing collaboration with India.
Health Minister Nalinda Jayathissa added that Sri Lanka and India had recently finalised an agreement to set up solar power plants across the island. The agreement will see the creation of a 50-megawatt solar facility in the first phase, followed by a 70-megawatt expansion in the second phase, both at Sampur.
The project will be a joint venture between Sri Lanka’s Ceylon Electricity Board and India’s National Thermal Power Corporation (NTPC), with both governments involved in the construction, ownership, and operation of the plants.
This project marks a notable shift from earlier plans when NTPC had proposed building a coal-fired power plant at the same site. However, the change in direction reflects a growing focus on sustainable energy sources and a commitment to reducing carbon emissions.
The solar plants will play a vital role in Sri Lanka’s renewable energy strategy and its broader goals for energy security.
The upcoming visit follows President Dissanayake’s diplomatic trip to New Delhi in December 2024, just months after he assumed office. During his visit, he was welcomed by Prime Minister Modi, and the two leaders held extensive discussions on strengthening bilateral relations, particularly in the context of increasing concerns over China’s growing influence in the Indian Ocean region.
At the time, the two leaders agreed to deepen cooperation in various sectors, including energy and infrastructure. Modi confirmed plans to enhance connectivity between the two nations, including the establishment of an electricity grid link and a multi-product petroleum pipeline.
These initiatives are expected to boost trade, investment, and overall commercial ties between India and Sri Lanka.
In addition to his talks with Prime Minister Modi, Dissanayake also met with India’s External Affairs Minister Subrahmanyam Jaishankar and National Security Advisor Ajit Doval.
At a joint press conference, the Sri Lankan leader assured that his country would not allow its territory to be used in a manner that could threaten India’s national security interests.
