March 09, Colombo (LNW): The Meteorology Department in its daily weather forecast today (09) has predicted a temporary shift in the current dry conditions across the island, with rain showers anticipated over the weekend, specifically on March 10 and 11.

This change in weather is expected to bring some relief to areas that have been experiencing prolonged dry spells.

Whilst the showers will be scattered, the Eastern and Uva provinces are likely to see the most significant rainfall, with some areas possibly receiving light to moderate showers.

In particular, the Eastern coastal regions could experience brief rainfall overnight on March 9, continuing into the morning hours of March 10.

Additionally, thundershowers may develop in several districts, including Galle, Matara, Kalutara, and Ratnapura, later in the day or during the evening.

These conditions may result in localized flooding or disruptions, so residents in these areas should remain alert.

The Met Department has also warned of misty conditions in the early hours, especially in the central highlands and other elevated regions.

Drivers are advised to exercise caution due to reduced visibility during the morning hours.

Whilst the forecast indicates a temporary break from the dry weather, the island is expected to return to more stable conditions shortly thereafter.

Sri Lanka’s Official Reserve Assets recorded a 0.5% increase in February 2025, reaching USD 6.095 billion, compared to USD 6.065 billion in January 2025, according to data released by the Central Bank of Sri Lanka (CBSL).

Foreign Exchange Reserves Show Growth

• The primary component of official reserve assets, foreign exchange reserves, saw a 0.7% rise, increasing from USD 5.986 billion to USD 6.031 billion during the same period.
• The increase reflects improved foreign currency inflows and stabilization measures taken by the monetary authorities.

The gradual improvement in Sri Lanka’s foreign reserves signals positive economic momentum, supporting exchange rate stability and external debt management.

The Inland Revenue Department (IRD) is currently undergoing a modernisation process to support recent tax policy reforms moving towards the automation of its core activities in a bid to improve efficiency, transparency and financial flexibility, finance ministry sources proclaimed.

The online portal is being upgraded to simplify individual income tax filing and accelerate outreach to re-register VAT taxpayers who dropped out and finalise improvements of the Random Access Management Information System (RAMIS) soon. 

RAMIS will be used to support the assessment of 2022/23 income tax returns and to administer and assess the Social Security Contribution Levy (SSCL) by end June 2024, with a view to reducing interactions between taxpayers and tax officials, a senior IRD official said. . . 

“We will more broadly ensure that processing tax collections is only carried out through RAMIS as of June 2024.”, he added. 

 The finance ministry has developed a medium-term IRD modernisation strategy and Implementation Plan with IMF assistance and will have it fully documented and endorsed for implementation soon. .

 Meanwhile the ministry is drafting legislation to create a semi-autonomous Revenue Authority, incorporating initially the Inland Revenue Department, and later the Customs and Excise departments. 

The aim is to strengthen revenue collection in the long-term and increase revenue administration professionalism and effectiveness. 

However he noted  that creation of such new institution will take time and will require significant resources, and every effort will be made to ensure that this does not undermine the effort to increase revenues.,

The finance ministry will consult with IMF experts before taking further steps in establishing the Revenue Authority.

It will obtain cabinet approval by August 2024 for an information technology strategic plan to deliver the RAMIS (version 3.0) with the needed functionality enhancements and design improvements 

(RAMIS) installed at the Inland Revenue Department (IRD) is to be reactivated changing the original design and software system, finance ministry sources disclosed.        

The new system will reverse the unintended consequences of the original design that resulted in even more discretion and interaction between revenue officials and taxpayers, and a misutilisation of scarce IRD resources, he said. 

Moreover there have been some encouraging developments in public procurement process, such as developing the Procurement Management Information System (PROMISe) which is being developed but is currently in a pilot phase. 

It has the potential to be a key tool for improving the integrity of public procurement by enabling better processing, tracking, recording, reporting, and publicising procurement actions and  outcomes,he added.  

A high-profile fraud involving over 200 luxury vehicle importation has been unearthed, amounting to a colossal loss to the government owing to non-payment of tax. 

The vehicles imported after 2015 were illegally registered in Sri Lanka’s Motor Traffic Department-MTD database as being imported before 2005 for evasion of paying customs duties, 

The CIABOC launched an investigation after it was tipped off that 400 vehicles had been registered without paying the requisite custom duties.

It was revealed that the aforementioned vehicles were fraudulently included in the MTD database, evading the declaration system maintained by Sri Lanka Customs, in contravention of the Customs Ordinance.

As of April 2024, CIABOC intelligence unit uncovered details of 200 such vehicles, with customs clearance records missing for 51. 

These included high-end models such as Jeeps, Land Cruisers, Monteros, and luxury cabs. The estimated loss to the government is Rs. 3 billion in unpaid duties, internal audit inspection carried out by the national audit office unit at Customs Department revealed.  .

On April 5, 2024, Colombo Chief Magistrate Prasanna de Alwis issued an interim order suspending the change of ownership of the 51 vehicles.

The CIABOC has filed a case based on these allegations at the Colombo Chief Magistrate’s Court last Tuesday 19.

Colombo Chief Magistrate Thilina Gamage issued summons to six high-ranking officials including a Deputy Commissioner of Motor Traffic Department, a software developer, and four clerks who maintain records pertaining to vehicle registration. of the MDT and two vehicle importers to appear in Court, in connection with their alleged involvement in this vehicle registration scam.

They have been indicted under the Anti-Corruption Act of 2023, Bribery Act of 1994, and the Customs Ordinance.

The Court also issued an order to seize 20 vehicles that were in their possession; they were handed over to customs for further investigations. 

This fraud goes back to a time when there were imports of vehicles prior to Sri Lanka imposing the ban in 2021, due to the economic crisis situation.

 However, there are concerns about systemic vulnerability with regard to customs and registration processes following the latest announcement to lift restrictions on imports from February 2025.

CIABOC has emphasised strict legal action against the financial loss and preventing such corruption in the future. Further investigations are going on with regard to the remaining 349 vehicles, and the Bribery Commission is working to bring all the culprits before the law.

Sri Lanka is promulgating new laws and initiatives in the hope of securing up to 10 foreign investments in mining with a view to increasing transparency and deriving greater value from the country’s mineral resources. 

Highly prospective mineral deposits in the country include 7.5 million MT of ilmenite, rutile, and zircon in Pulmudai and Puttalam; 45,000 MT of graphite; and 60 million MT of apatite according to Board of Investment data.

With these resources, nonetheless, the mining sector presents a number of challenges. Indistinct policies on resource management and foreign investment discourage long-term investors. 

Strict environmental regulations, though important, delay project endorsements. Mining, particularly for mineral sands, has commonly caused coastal erosion, loss of biodiversity, and habitat destruction, which ignites wide public outcry and increases regulatory pressure. 

On top of that, extraction and processing methods are outdated, reducing efficiency and profitability. 

The country exports mainly raw minerals rather than value addition, leading to reduced revenues. There are also accusations of corruption regarding licensing and revenue management, which further tarnish public confidence and discourage genuine investors, several mineral mining license holders said. . 

By 2024, investors from countries like India, Australia, and the UK have been attracted by Sri Lanka’s mineral sector   

Notably, Capital Metals PLC, a company based in the UK, is advancing its Eastern Minerals Project, located within the Eastern Province. 

This includes the mineral sands ilmenite, rutile, zircon, and garnet in more than 17 million tons. 

Capital Metals expressed confidence in the recent political changes in Sri Lanka, which are generally seen as positive toward foreign investment. 

The project would provide more than 300 direct jobs and generate government royalties and taxes valued at approximately $130 million. 

The Geological Survey and Mines Bureau (GSMB) has already extended deadlines for the meeting of conditions attached to the IMLs, with more such licenses foreseen for a 47-square-kilometer exploration area.

Drilling operations began in August 2024 after necessary equipment and personnel arrived in the country. 

Other foreign companies, especially from India and Australia, have also applied for mining licenses. 

These ventures aim to exploit free trade agreements, such as the Indo-Sri Lanka and Pakistan-Sri Lanka agreements, for machinery access on duty-free status.

There are, however, concerns that there may be corruption involved in the sector. The Commission to Investigate Allegations of Bribery or Corruption has been informed about some questionable efforts to grant a monopoly over mining to an Australian company. 

This Australian company was claiming to have invested $20 million in Sri Lanka, but further investigation showed discrepancies in how those funds entered the country. 

Allegations suggest the money might have been used to secure the cooperation of corrupt officials, disrupt local enterprises, or undermine state institutions equipped to manage mineral resources effectively.

Sri Lanka’s efforts to attract foreign investment must address these challenges to ensure the mineral sector develops transparently and sustainably.

The Colombo Port City construction delays due to successive governments’ ad hoc decisions of suspending the ongoing work from time to time have caused a loss of millions of dollars for the state, the national audit office revealed.

These delays have had implications for the project’s timeline, investor confidence, and Sri Lanka’s diplomatic relations, particularly with China, several foreign and current affairs analysts claimed. 

The mega development project project, which is a 100 privately funded foreign direct investment of US $1.4 billion by the China Harbour Engineering Company (CHEC) , the primary developer began construction following the signing of an Agreement with the Government of Sri Lanka on  September16 2014.

But all construction work has stopped following the Sri Lankan Government’s official communication on March 06 2015 issued by the Secretary to the Ministry of Ports, Shipping & Aviation, communicating the decision by the Cabinet Ministers to temporarily suspend ongoing work of the Project, with immediate effect.

As a result of this suspension, CCCC estimated an initial direct loss for the company of over $380,000 per day. Further the interest on the financial loan obtained by the company for the development of the project is being paid, regardless of the ongoing suspension.

The company responsible for the project had demanded a compensation amounting to US $ 143 million, auditor general’s recent report revealed adding that a land of high commercial value had been released to the company in exchange for the compensation.

THE CCCC has dropped its claim against the Sri Lankan government for $143 million in compensation for delaying the $1.4 billion Colombo Port City development, in return for getting additional land for the project

The assessment value of this land had not been reported thus causing a loss to the Government, the audit inspection observed. 

Over 200 meters of the breakwater constructed thus far, has been damaged due to the suspension, as the company is unable to take measures to protect the reclaimed land due to the suspension.

The reconstruction of this damaged land has caused an additional cost to the company while a sum of Rs. 1,000 million had been estimated for a temporary solution until a permanent solution is put in place for the management of sewage system of the Port City. 

However, the estimated amount had increased to Rs. 3,700 million due to changes in the plan and increase in prices, audit report highlighted. 

This work should have been completed in the year 2019 in accordance with the tripartite agreement for the Colombo Port Expansion Project, but the project had been resumed in December 2022. 

It had not been completed even by September 31 2023 even though a sum of Rs. 1,600 million had been spent during the period 2017-2019. 

The south sewage system planned to be completed in 07 stages, should have been completed by 11 July 2023, but 03 stages remained in planning phase even by September 30  2023 audit report observed.

President Anura Kumara Dissanayake has emphasized the importance of transforming the Sri Lanka Insurance Corporation (SLIC) into a key contributor to the national economy through efficient and strategic investments.

During a discussion held today (March 7) at the Presidential Secretariat with SLIC officials, the President underscored the need for strong management practices to enhance the profitability and sustainability of the state-owned insurer.

Ensuring Financial Stability & Responsible Management

• The President cautioned that financial mismanagement at SLIC could have direct consequences for public investors, stressing the need for responsible financial stewardship.
• The meeting included a comprehensive review of SLIC’s current operations, investment portfolio, and future growth strategies.
• Discussions focused on enhancing returns, expanding market share, and strengthening financial stability.

High-Level Participation

The meeting was attended by:

• SLIC Chairman Nusith Kumaratunga
• Board of Directors members
• Senior SLIC officials

With the insurance sector playing a vital role in economic stability, the government aims to position SLIC as a leading institution that drives sustainable financial growth while protecting policyholders and public investments.

Minister Samantha Vidyarathna has announced that 36,000 acres will be allocated for new coconut cultivation this year, with 16,000 acres designated for the Northern Coconut Triangle and the remaining 20,000 acres spread across other regions.

Speaking at the Ministerial Consultative Committee on Plantation and Community Infrastructure held on March 5, 2025, Minister Vidyarathna outlined several key initiatives aimed at boosting coconut cultivation. Deputy Minister Sundaralingam Pradeep also participated in the discussions.

Key Measures to Boost Coconut Production

• 2.5 million coconut seedlings will be produced in 2025.
• 27,500 metric tons of MOP fertilizer (from a 55,000 metric ton donation by Russia) will be used to produce 56,000 metric tons of mixed fertilizer for coconut cultivation.
• A subsidized fertilizer program will offer 50 kg sacks of mixed fertilizer at LKR 4,000, compared to the market price of LKR 9,500.

Estate-Sector Housing & Infrastructure Development

• Under the Indian Aid program, 4,700 new estate houses will be built in 2025 as part of the 10,000-housing project.
• The government has pledged greater transparency in selecting housing beneficiaries, prioritizing families in landslide-prone areas.
• LKR 1.3 billion in domestic funds will be allocated for estate housing and infrastructure.

Future Plans & Production Targets

Ministry Secretary Prabath Chandrakeerthi presented an overview of the plantation sector’s performance and goals, including:

• Identifying 30,000 hectares of underutilized plantation lands for investment.
• Setting 2025 targets for key exports:
  • Tea: 275 million kg (compared to 262 million kg in 2024).
  • Rubber: 78 million kg, despite a decline in exports.
  • Coconut: 2,875 million nuts.

Concerns Over Quality & Sustainability

Discussions also addressed challenges in maintaining Sri Lankan tea and cinnamon quality, particularly due to excessive use of glyphosate. MPs also raised concerns about:

• Tea fertilizer quality standards
• Promoting cashew cultivation
• Other critical plantation issues

With these measures, Sri Lanka aims to strengthen its plantation sector, enhance export earnings, and ensure sustainable agricultural growth.

The Sri Lanka Navy has apprehended an Indian fishing vessel along with 14 Indian fishermen for engaging in illegal fishing activities in Sri Lankan territorial waters off the southern coast of Mannar.

The operation was conducted on March 6, 2025, by the North Western Naval Command as part of routine patrols to prevent unauthorized fishing and protect marine resources. The seized vessel and the detained fishermen were taken to the Thalvapadu Jetty in Mannar for further legal proceedings.

Sri Lanka has consistently taken steps to curb illegal fishing, as such activities pose a significant threat to local fisheriesand marine ecosystems. The detained individuals are expected to face legal action under Sri Lankan maritime laws.

President Anura Kumara Dissanayake has emphasized the importance of fully utilizing the budgetary allocations for irrigation development within the next eight months.

The President made these remarks during a discussion held today (06) at the Presidential Secretariat regarding the future development of the irrigation sector and the effective deployment of allocated funds in the 2025 Budget.

He noted that a significant budget allocation has been made for irrigation this year to address persistent water issues faced by farmers and strengthen agricultural productivity.

The discussion also focused on ensuring proper implementation of these projects, as achieving the national economic growth target of 3%–4% depends on efficient execution. Officials were urged to closely monitor the projects and ensure optimal utilization of funds.