• Another IMF team due soon to focus on property tax; Govt. to note counterproductive proposals
• Govt.’s policy statement to be debated for two days; RW to leave for Australia to attend IOC on 8th
• Delays in finalising debt restructuring with bilateral and private creditors; focus remains on China
• Govt. faces geopolitical tension with arrival of Indian naval submarine after denying Chinese vessel
• UNP and SJB appoint polls campaign leads; Mahinda and Ronald to lead UNP, Sujeewa to lead SJB
• RW meets SLPP and coalition partners, says winning candidate at Prez Polls will need backing by all
• SLPP angered by presence of SLFP, Yapa-Lanza alliance; RW asked to first discuss with SLPP, MR, BR
• SLFP to form alliance under PA that brought CBK to power; Maithripala reinstates CBK in the SLFP
• Daya stirs hornet’s nest in SJB as SF slams Sajith and party; SJB seniors hit out at SF for public outcry
• A divided ITAK under new Leader faces risk of split; Shritharan seeks Indian intervention, India says no

As Sri Lanka celebrates its 76th Independence Day today, the country continues to be at a crossroads economically, politically, and socially, while the masses live in eternal hope. The challenges faced by President Ranil Wickremesinghe and his Government continue to show no signs of abating any time soon. 

The complexity in the local political scene is evident by the divisions witnessed in political parties in the south and the north. 

The complexities faced by the Wickremesinghe Government took a new twist with the arrest of Cabinet Minister Keheliya Rambukwella following a probe on the importation of substandard medication. It is the first time a Cabinet minister has been arrested for alleged malpractice.

On the economic front, while the ongoing hardship is having an adverse impact on the citizenry, the debt restructuring programme is yet to see a finalisation with the bilateral creditors as well as with private creditors.

The deal with the bilateral creditors hinges greatly on China. It is learnt that the Government had placed much focus on finalising a debt restructuring programme with bilateral creditors due to China’s decision to stand out of the Official Creditor Committee (OCC) headed by India, Japan, and France and had not held extensive talks with private creditors.

The OCC is of the view that China too should agree to the same conditions that all other bilateral creditors are agreeable to. 

Nevertheless, the debt treatment process has ended up being a competition between India and China.

While India has maintained the role of a historical partner who came to Sri Lanka’s aid during the height of the economic crisis last year, China too has been making statements to the effect that it had always been a ‘friend’ to Sri Lanka.

India’s External Affairs Minister S. Jaishankar was recently reported saying to a group of youth: “My first advice to you, the next time you want to take a holiday, go to Sri Lanka. I’m serious. Please go to Sri Lanka. I say this to all of you.” 

This show of support is expected to lead to a further strengthening of Indo-Lanka relations.

He had emphasised that amidst the global indifference to Sri Lanka’s economic turmoil, India had emerged as a steadfast ally, garnering significant appreciation from the Sri Lankan populace.

Jaishankar had also said: “Mix with the normal person in Sri Lanka and ask them what they think about India. And I can tell you, you’ll feel yourself grow with that answer.”

Be that as it may, the arrival of Indian Naval Submarine (INS) Karanj in Colombo on an official visit will not bode well with the Chinese, who are still displeased by Sri Lanka’s decision to not permit one of its vessels to call at Colombo last month. The vessel had to instead call at the Maldives. The Sri Lankan Government had maintained that it had put in place a moratorium on foreign research vessels calling in Sri Lanka for a period of one year until the mechanism was put in place for monitoring and implementation of the Standard Operating Procedure (SOP).

With China being a crucial factor in Sri Lanka’s bilateral debt restructuring programme, it will be interesting to see how Sri Lanka will manage this geopolitical complexity.

Meanwhile, the next tranche of the International Monetary Fund (IMF) under the Extended Fund Facility (EFF) is likely to see a delay due to the country’s debt restructuring programme once again facing a snag, this time on the negotiations with private creditors.

IMF Senior Mission Chief to Sri Lanka Peter Breuer had said recently that the IMF was hopeful that Sri Lanka would secure an agreement with its commercial creditors, including bondholders and the China Development Bank, ahead of the next review.

Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe had told Financial Times that the restructuring of $ 13 billion debt with holders of its defaulted US Dollar bonds would be done within “a couple of months.”

“There’s a lot of interest from private creditors to finish this as soon as possible. But because of the procedure, it takes a certain time… We also want to do that fast,” the CBSL Governor had said.

He had noted that Sri Lanka must “ensure whatever proposals we have exchanged are consistent with the [IMF’s] debt sustainability analysis and also comparable [with] what we have been discussing with other creditors. That’s a bit of a complicated process.”

It is in such a backdrop that President Wickremesinghe will present the Government’s policy statement on Wednesday (7) at the opening of the fifth session of the ninth Parliament and the statement is to be debated for two days in the House.

Following the opening of the fifth parliamentary session, Wickremesinghe is expected to leave the country on Thursday (8) to attend the Indian Ocean Conference (IOC) in Perth, Australia and return on Saturday (10).

No bankruptcy

CBSL Governor Weerasinghe has meanwhile rejected claims that Sri Lanka has become a bankrupt state.

While testifying recently before the parliamentary committee probing the causes for the country’s bankruptcy, Weerasinghe had noted that what had happened last year was not that the country had become bankrupt, but that there had been a postponement of selected domestic and foreign loan repayments.

According to the CBSL Governor, he had explained this fact at the Supreme Court hearing on a related case and its ruling had made no mention of any bankruptcy either.

Another IMF team

Another team from the IMF is expected to arrive in the country this week. This time around, the team is expected to focus on Sri Lanka’s tax system.

It is learnt that the IMF officials will explore in detail the implementation of the proposed property tax, which the IMF’s Breuer had pushed during the recent visit of another delegation he led.

It is also learnt that the Government expects to extensively explain the tax collections made so far and the counterproductive nature of some of the taxes imposed on the public.

Meanwhile, the Government has stated that it expects to reduce Value-Added Tax (VAT) and other indirect taxes over a medium-term period once new tax measures targeting High-Net-Worth Individuals (HNWIs) are introduced.

Treasury Deputy Secretary R.M.P. Rathnayake had told the media recently that the Government planned to give some relief to the public in relation to indirect taxes such as VAT, but that the timeline of such measures would rely on the generation of revenue from direct taxes.

Campaign leads

Amidst the economic chaos with election fever heating up the local political scene, the leaders of the United National Party (UNP) and Samagi Jana Balawegaya (SJB) have taken steps to appoint the individuals who will lead the election campaigns of the respective parties.

It is learnt that UNP Leader, President Wickremesinghe is looking at President’s Counsel Ronald Perera and Mahinda Haradasa to lead the election campaign for the party. A committee has also been appointed to carry out the UNP’s campaign work. The committee is to include Working Committee members Shamal Senarath, Lasantha Gunawardena, and Krishan Theodore.

On the other hand, SJB Leader Sajith Premadasa has appointed former Parliamentarian and confidant Sujeewa Senasinghe as the SJB’s campaign lead.

RW meets SLPP

President Wickremesinghe had also held a key political meeting on Thursday (1) at the Presidential Secretariat. The meeting presided over by the President was attended by Sri Lanka Podujana Peramuna (SLPP) seniors including party leaders in the SLPP, the Sri Lanka Freedom Party (SLFP), and the Ceylon Workers’ Congress (CWC), as well as SLPP dissidents led by Anura Yapa and Nimal Lanza.

It is learnt that the discussion had been focused on the impending Presidential Election and the formation of a new, broad political alliance that will include the SLPP and the UNP.

One of the main questions posed to Wickremesinghe was whether he was planning on contesting the next Presidential Election. The President had responded saying that it would depend on all those who were present at the meeting. “All these forces here will have to unite in order to field a winning candidate. Otherwise, no one will be able to win,” he had said.

However, the SLPPers had pointed out that there were some outstanding issues that needed to be resolved between Wickremesinghe and the SLPP. Relations between the SLPP and President Wickremesinghe were soured after the latter had not acted on a list of names of SLPP Members of Parliament (MPs) given by the SLPP to be appointed as Cabinet ministers in the Wickremesinghe Government.

SLPP General Secretary Sagara Kariyawasam had objected to the meeting being convened as an all-party meeting of the SLPP without the approval of the SLPP leadership. “We did not know that you had called this meeting to discuss all this. If you wanted to talk about an election or the Presidential Election, you should have first held an official discussion about the matter with the ruling party in the Government, which is the SLPP. There has to be an agreement reached on the matter with SLPP Leader Mahinda Rajapaksa (MR) and Basil Rajapaksa. Otherwise, there’s no point in talking about this matter with all parties here. We have raised this issue with you earlier as well,” Kariyawasam had claimed.

Wickremesinghe had then said that he would initiate a discussion on forming an alliance and support for presidential candidacy with SLPP Founder Basil Rajapaksa, who is currently in the US visiting family, and then convene another meeting.

However, it is learnt that Wickremesinghe had already held a discussion on the next Presidential Election with MR and Basil. It is also learnt that Basil had expressed his displeasure at the formation of a new alliance by Yapa-Lanza in support of Wickremesinghe by breaking away from the SLPP.

Wickremesinghe, it is learnt, had said that breakaways and alliances being formed were all part of politics. It is obvious that Wickremesinghe’s response had not gone down well with Basil. Nevertheless, Basil had informed SLPP seniors to give Wickremesinghe time till March to see what he had planned.

Thursday’s meeting therefore had ended without a final decision being reached on the formation of a political alliance with the SLPP as well as on the candidate the SLPP will back at the next Presidential Election.

Another ‘Aragalaya’?

The main Opposition SJB meanwhile commenced its anti-Government campaign on Tuesday (30 January) in Colombo with a protest march and rally, which SJB leaders claimed was the next phase of the ‘Aragalaya’ protest campaign.

The protest campaign was organised by SJB MP S.M. Marikkar. Although there were doubts among SJB seniors on whether the protest would be a success, the response received by SJBers at grassroots level had given them hope.

However, Marikkar had also learnt that there were moves by the Police to get an enjoining order from court to prevent the protest from going ahead. The next key decision was about the place where the crowds participating in the protest could gather. Marikkar had initially identified several grounds in Colombo from Hyde Park to Campbell Park. However, the plan had to be changed after learning of the interest shown by SJBers to participate in the protest.

The next decision was on whether the SJB protesters should enter Colombo from one route or from several routes. The SJB leadership was of the view that the protesters should enter Colombo from one route to show the crowd as well as to highlight the impact of the Government’s suppressive actions.

A final decision on the route was made during a Zoom meeting on Monday (29 January) night. By then the SJB leadership had learnt that the Police was going to obtain court orders preventing protesters from entering Colombo from several routes. It was then decided that the final decision on the route would be made after looking at the court orders that would be obtained by the Police.

The SJB seniors also decided to create an impression among the Police and Intelligence units that the protest would gather at the Technical Junction in Maradana.

On the day of the protest, the Police obtained court orders from the Maligakanda, Fort, and several other Magistrate’s Courts. The Chief Magistrate’s Court had however turned down a request for an order sought by the Cinnamon Gardens Police.

The SJB seniors had immediately decided that the protesters should gather in the Town Hall area since there was no court order covering the said area. The protest march was to proceed until Kompanna Veediya where the protesters were to gather and hold a rally. All SJBers were asked to gather at Town Hall by 2 p.m.

The SJB seniors as well as the organisers had by then heard from within the Government that Police had been ordered to use tear gas and water cannons to disperse the protesters. The SJB seniors had once again reportedly met for an emergency meeting to discuss the next course of action. 

Two schools of thought had emerged at this meeting. Some had opined that the protest march should be cancelled and that a protest rally should be held in the Town Hall area instead. Another group including Marikkar and Mujibur Rahman had said that the protest march should be held as planned despite the threat of being teargassed. Premadasa had also agreed and it was finally decided to proceed with the protest march and face the tear gas and water cannons.

The Police had formed several protective circles near the Public Library and took steps to use tear gas and open water cannons on the protesters as soon as they commenced the march.

Former SJB MP Mujibur Rahman was among the SJBers who were admitted to hospital for treatment for injuries sustained during the protest. Police Spokesman Nihal Thalduwa had confirmed that a few policemen had also been injured.

SF slams Sajith

SJB Chairman, Field Marshal Sarath Fonseka meanwhile criticised Party Leader Premadasa’s move to welcome former Army Commander General Daya Ratnayake to the party fold last week.

Fonseka had claimed that Ratnayake had been involved in his imprisonment back in 2010 under the then administration of President MR. According to Fonseka, he had not been consulted by the party leadership regarding this decision as the Chairman of the party.

According to the Field Marshal, Ratnayake joining the SJB raises questions about the party's direction and principles. Fonseka had further claimed that the party now seemed to have compromised on its political stance.

He had said that the SJB had been formed as an alternative to the existing political system in the midst of various challenges and that, therefore, the party’s standards must be set at a good level. 

Fonseka had further urged the party leadership to consider the people’s expectations and the trust placed in the party when accommodating new members.

Daya’s conundrum

Following Fonseka’s claims about Ratnayake and his joining the SJB, social media reports on Thursday (1) had stated that Ratnayake had joined the Mawbima Janatha Party (MJP) led by businessman-turned-politician Dilith Jayaweera.

The story was circulated on social media after a photograph of Ratnayake meeting with Jayaweera, supposedly at the MJP Head Office, was posted online.

However, Ratnayake had denied the reports, saying that he had not left the SJB.

Senior SJBer Senasinghe, who had been appointed as campaign manager, had issued a statement saying that the report that Ratnayake had joined the MJP was false.

“The photograph circulated in social media taken with businessman Dilith Jayaweera is an old photograph,” Senasinghe had said.

A group of SJBers had meanwhile requested the party leadership to convene a Working Committee meeting to discuss the internal clashes within the SJB following Ratnayake’s appointment as an advisor to Premadasa.

Ratnayake meanwhile in an interview with an electronic media channel had dismissed the allegations levelled against him by Fonseka, adding that he did not have any issue with Fonseka and that he had faith in Premadasa.

SF gathers flak

Meanwhile, Fonseka gathered much flak from fellow SJBers for his public statements on Ratnayake joining the party as well as the critical comments made about the protest campaign organised by the party in Colombo last week.

Senior SJBers started to make public statements claiming that Fonseka should first understand party discipline and not make public statements about issues that should first be discussed within the party.

One of the main reasons for the SJB seniors’ anger against SF was due to the latter’s statement that the protest held by the SJB in Colombo last week had not been a success.

Dilith rejects RW

Meanwhile, MJP’s Jayaweera has also stated that he has no plan to seek an alliance with President Wickremesinghe during the upcoming election season.

Addressing the MJP’s district convention in Anuradhapura, Jayaweera had dismissed reports that the MJP was making plans to tie up with UNP Leader and President Wickremesinghe to face elections.

“There are rumours that the MJP will forge an alliance with Ranil Wickremesinghe for the elections. I would like to say that no matter who we may look to form an alliance with, Ranil Wickremesinghe will be the last person we will look at. The reason for that is that he [Wickremesinghe] does not believe in this countries’ civilisation, nor does he believe in our future. He thinks Sri Lanka will develop by 2024. We view that notion as an empty promise,” Jayaweera had opined, adding that the MJP was ready to debate serious national policies and the party’s policies with anyone.

New alliance launched

However, amidst the clashes within the main Opposition SJB, a new alliance consisting of SLPP dissidents took shape recently with the holding of its inaugural public rally in Ja-Ela on 27 January.

MPs Nimal Lanza, Anura Priyadarshana Yapa, Nalin Fernando, Susil Premajayantha, and Piyankara Jayaratne were among the participants. Minister Nalin Fernando had organised the event.

Lanza had said that a new alliance would be formed by the union of the greatest number of MPs representing the highest number of political parties in Parliament.

Namal takes charge

The ruling SLPP meanwhile is continuing with its programme to meet with electoral members through the ‘Dasa Bala Sena’ programme led by SLPP MP Namal Rajapaksa.

While many SLPP seniors have claimed that Namal has taken charge of the work earlier carried out by the party’s former National Organiser, Basil, who is currently overseas, Namal has told the media that he was carrying out the duties assigned to him by Basil. He had explained that Basil always assigned party members certain work to be carried out whenever he travelled overseas.

According to Namal, the SLPP has a strong team that includes ministers in the Government and young MPs and they are all working to ensure the party’s victory at the next election.

However, Namal had added that the party’s ongoing programmes had been temporarily halted recently due to the sudden death of State Minister Sanath Nishantha and that the ‘Dasa Bala Sena’ programme was now in progress once again.

SLFP alliance issues

The SLFP, which is also working on forming a broad political alliance for the upcoming election, is facing several hurdles due to the controversy over key posts in the SLFP-led United People’s Freedom Alliance (UPFA) and the People’s Alliance (PA).

The SLFP’s first choice to form the new alliance was the UPFA. However, the existing controversy over the post of general secretary has resulted in the SLFP now considering the possibility of reviving the PA. Minister Susil Premajayantha, who is now a member of the Yapa-Lanza alliance, is the General Secretary of the PA.

However, it is learnt that UPFA Leader, former President Maithripala Sirisena (also the SLFP Leader) has asked both Mahinda Amaraweera and Thilanga Sumathipala, who are both claiming the post of general secretary of the UPFA, to resign from the post with immediate effect.

Amaraweera was removed from the post of general secretary of the UPFA after he joined the Wickremesinghe Government in contravention to the SLFP’s stance and Sumathipala had been appointed to the post instead.

Amaraweera had then challenged his removal from the UPFA post in court while the Election Commission had stated that it would not recognise either Amaraweera or Sumathipala as the general secretary of the UPFA until the litigation process was completed.

It was therefore decided by Sirisena to demand the resignation of both Amaraweera and Sumathipala in order to appoint a new general secretary to form the new political alliance under the UPFA.

Resignation delayed

Sumathipala meanwhile has said he will only step down as General Secretary of the UPFA following a court ruling.

In response to media reports that he was to resign from the post in the UPFA along with Amaraweera, Sumathipala had said that Amaraweera had filed a court case challenging his appointment to the position and that Amaraweera should therefore first withdraw that petition and that he [Sumathipala] would decide on his resignation afterwards.

Sumathipala, it is learnt, had also informed Sirisena of this fact in writing on Wednesday (31 January).

The issue of the UPFA general secretary post had even come up at the PA’s Working Committee meeting on Monday (29 January), which was chaired by Sirisena.

It was then that the participants at the meeting had decided to form an extensive alliance under the ‘chair’ symbol.

Preparing new alliance

However, it was later learnt that Amaraweera and Sumathipala have sent their letters of resignation from the post of UPFA general secretary.

The letters that have been sent to Party Leader Sirisena are to be produced before courts to settle the case filed by Amaraweera.

It is in such a backdrop that arrangements are now being made to form a broad SLFP-led alliance under the ‘chair’ symbol of the PA. Its launch is expected to be held in Colombo at an auspicious date yet to be announced.

The Constitution of the PA had been finalised last week and accordingly, 25% of the composition of the Working Committee of the new alliance will lie with the SLFP. The leadership and the posts of secretary, treasurer, and national organiser will be with the SLFP.

The PA is to hold a convention this week to finalise the rest of the alliance plan.

CBK back in the SLFP

SLFP Leader Sirisena meanwhile has reinstated former Party Leader and former President Chandrika Bandaranaike Kumaratunga (CBK) in the party. Sirisena has also informed CBK that her party membership has been reinstated.

CBK’s party membership was suspended along with a group of SLFPers over the accusation of acting in contravention to party decisions. Her reinstatement in the SLFP will once again enable CBK to actively participate in the SLFP’s political activities targeting the next round of national-level elections.

Since the PA was first formed in 1994 for CBK to contest and win the chief ministerial post in the Western Province and then the premiership and eventually the presidency, many SLFPers believe that CBK will once again lead the revived PA.

Leadership talk

Meanwhile, the talk in political circles that CBK is to lead the new SLFP-led alliance is yet to be confirmed, with a group of senior SLFPers claiming that her leadership as alliance leader will not include executive powers.

SLFP Senior Vice President Prof. Rohana Luxman Piyadasa had told the media that while CBK’s name had been suggested as the leader of the alliance, her position would not have executive powers within the alliance, unlike the SLFP leadership. 

Prof. Piyadasa had explained that CBK’s name had been suggested for the position as they wanted to unite all breakaway groups and political groups with different political opinions. “Kumaratunga’s name was suggested for the leadership of the alliance, but that position does not have executive powers. There is a separate chairperson of the alliance who has the power as per the Constitution of the alliance.”

“The Constitution says that the chairperson and the general secretary of the alliance should be members of the SLFP. Therefore, the alliance’s chairperson will have executive power within the alliance,” he had further stated, adding that the SLFP would contest any upcoming election either as the PA or the UPFA.

ITAK blues

On the Tamil political front, the Ilankai Tamil Arasu Kachchi (ITAK), which recently elected a new leadership, is facing a new crisis due to the issues faced in appointing new office bearers to the party.

ITAK members met last week in Trincomalee to appoint/elect new office bearers and the matter of appointing the new general secretary of the alliance had run into issues, resulting in the meeting being cancelled.

It is learnt that the appointment of an individual as the new general secretary of ITAK had been cancelled following allegations that there had been certain irregularities during the voting process.

With new ITAK Leader S. Shritharan moving away from the usual Tamil National Alliance (TNA) stance and adopting a hardline pro-federal stand, the ITAK is heading for a clear division.

Focus on division

It is in such a backdrop that new High Commissioner of India to Sri Lanka Santosh Jha engaged in his maiden interaction with representatives of Tamil parties in the north recently.

ITAK’s Shritharan had put much pressure on the Indians saying that India needed to intervene and ensure that Provincial Council Elections were held and the 13th Amendment to the Constitution was fully implemented. The High Commissioner had said that it was a matter that the local politicians should jointly push for. When Sritharan had continued to demand that India intervene, Jha had noted that India could help develop the northern economy.

It is learnt that 12 Tamil politicians had attended the meeting representing eight political parties. Seeing the diversity within the country’s northern Tamil politicians, the Indian officials had noted that they [Tamil politicians] might be able to get what they want if they spoke in a unified voice.