The Palmyrah Profile
The first dominant sign of Jaffna peninsula is immune to change. In fact, such a transformation is simply unthinkable. Those towering trees stretch across the landscape. Just as the slender trunks and sweeping fronds of the coconut define the South, the Palmyrah stands tall in the North, with its fan-shaped leaves and rugged, column-like trunks. The Palmyrah are far more than just scenery. They are part and parcel of the northern region’s economy, culture, and daily life.
The latest data reveal that total exports from the Palmyrah sector soared from approximately Rs. 22 million in January and February 2024 to nearly Rs. 93 million in the same period of 2025. This 322% growth demonstrates the recent initiatives aimed at expanding production and market reach. The revenue increase also indicates a rise in demand as well as the sector’s capacity to compete in global markets.
It is against this backdrop that the Daily News steps into the Palmyrah Development Board (PDB), located along Kandy Road in Jaffna to meet its chairperson, Vinayagamoorthy Sakathevan.
All was not well when Sakathevan took office in October 2024. A new government was in power, and change was in the air. Yet, not everyone was ready to embrace it. Certain segments were hesitant, seeking to sideline the new chairperson. But Sakathevan’s decade-long experience proved invaluable. He earned trust and support through his expertise and approachable leadership.
Vinayagamoorthy Sakathevan is a researcher, community development consultant, and entrepreneur with over 32 years of experience in research and development. With expertise in biotechnology and specialisation in tissue culture, he has played a key role in modernising farming, aquaculture, and environmental conservation. His contributions include the planting of over 10,000 bamboo and other trees across Kilinochchi, Mullaitivu, and Mannar within a month. He has also participated in agricultural and aquaculture research and development across Singapore, Malaysia, Thailand, Indonesia, Vietnam, and Cambodia.
Community Upliftment
The PDB has been established to oversee the cultivation, processing, and commercialisation of Palmyrah-based products. Initially instituted by leftist stalwart NM Perera, the sector was created to empower the lower communities in Jaffna through the Jaffna Palm Development Co-Operative Society. Upper-class participation was minimal due to prevailing caste-based social structures. Making this initiative, therefore,was a critical factor for community upliftment.
The PDB was originally placed under the Ministry of Plantations, as per the amendment to the Sri Lanka Coconut Development Act in 1978. However, in 2024, it was brought under the Ministry of Plantation and Community Infrastructure to sharpen its focus on economic and industrial expansion. Its activities include the restoration of Palmyrah plantations, renovation of existing farms, handicraft training program, product development, research, and national and international product promotion through sales outlets like Katpaham.
“Palmyrah remains one of the most underutilised resources, with an estimated 15 million trees, half of which are mature and suitable for tapping. Each Palmyrah tree can generate an annual seasonal income of approximately Rs. 120,000.If fully utilised, local revenue from Palmyrah-based products could reach Rs. 900 billion annually.If exported, the industry has the potential to generate $24 billion annually,” Sakathevan explains.
He adds: “The global alcoholic beverage market is expected to reach $2036 billion by 2030. If Sri Lanka manages to capture at least 1% of this market through Palmyrah-based beverages, the sector could generate significant foreign exchange.”
Value-Added Products
Palmyrah offers a wide range of both alcoholic and non-alcoholic products, with over 1,000 reported value-added products. These include alcoholic products such astoddy, arrack, wine and brandy. The non-alcoholic products includesweet toddy, jaggery, treacle, tuber, fiber, pulp, handicrafts, panaddu, timber, sugar candy. Value-added products include biscuits, sauces, cakes, yogurt, ice-cream, hand wash, shoe polish, Palmate, and more.
The industry is supported by a network of stakeholders: the Palmyrah Development Board, the Palmyrah Research Institute, 38 Palm Product Development Co-operative Societies with 7,000 members, 50 Women’s Production Groups involving 3,000 women, over 50 exporters, and various Government and non-government institutions.
Despite its economic potential, the Palmyrah sector has faced numerous challenges, including political interference, war, and the privatisation of key distilleries. Under Sakathevan’s leadership, however, efforts are underway to regain control of these assets for community-driven economic development.
Sakathevan has also developed a strategic framework to tackle industry barriers. In just three months, he has streamlined tree-cutting regulations, eased export restrictions, and revamped branding strategies. His efforts have already led to a notable revenue boost: the PDB has generated Rs. 300 million in a short period.
“We’ve set a long-term five-year plan in motion to maximise the industry’s potential, particularly in Jaffna. The peninsula is home to around 115 million Palmyrah trees.If executed without political interference, this industry could generate up to $25 billion in revenue and become a major contributor to the country’s economy,” Sakathevan notes.
Modern Technology
Jaffna’s Palmyrah industry also has the potential to address unemployment and integrate modern technology into production processes. Sakathevan has taken significant steps transform the sector into a key economic driver.
“Our major focus has been the modernisation of jaggery and toddy production. We have introduced advanced processing techniques that minimise waste while enhancing efficiency. Sustainable resource management has also taken centrestage. We have taken strict measures to curb the destruction of Palmyrah trees. These measures ensure that this valuable resource continues to benefit future generations,” Sakathevan emphasises.
“Palmyrah is not only an economic asset but also a natural ally in carbon sequestration and biodiversity conservation,” he adds.
Efforts are underway to expand Palmyrah-based industries beyond Jaffna, across the country. Traditionally confined to the Northern Province, these products are now being positioned for creating new opportunities for investment and employment.
“The people in the South have yet to fully embrace Palmyrah beyond its traditional uses. The tree’s economic impact extends far beyond the Northwith over 800 unique products. The Government is also engaging the Tamil diaspora to support investment and export expansion,” Sakathevan explains.
For the first time, international orders are now being managed directly from Jaffna, rather than being routed through Colombo as in the past.
https://www.dailynews.lk/2025/03/20/featured/745508/the-palmyrah-profile/
Concessions and credibility
Last week, the Minister of Foreign Affairs announced that a delegation of European Union (EU) representatives is scheduled to visit Sri Lanka next week to assess the EU’s Generalised Scheme of Preferences Plus (GSP+) tax concessions granted to the country. The EU is Sri Lanka’s second-largest trading partner. It goes without saying that for dollar-strapped Sri Lanka, the GSP+ concessions scheme is a vital economic lifeline.
According to the Institute of Policy Studies, in 2023, Sri Lanka exported goods worth $ 3.63 billion to the EU and the United Kingdom (UK) representing 30% of total exports of Sri Lanka for that year. The 1,301 products exported by Sri Lanka under the six-digit Harmonized System (HS) codes, concentrate on key sectors such as wearing apparel, rubber, seafood, and tea. Notably, the EU and the UK are major export destinations for wearing apparel accounting for over half (54.9%) of Sri Lanka’s total wearing apparel exports. As such, the importance of maintaining GSP+ while Sri Lanka struggles to reach economic stability and recommences debt repayment in the coming years should be evident to all parties concerned. GSP+ preference offers Sri Lanka zero tariffs on many goods, granting relative price competitiveness in the EU market. Without GSP+, tariffs would revert to the EU’s Most Favoured Nation (MFN) rates. The preference margin – the difference between MFN and GSP+ – is more than 10 percentage points for high-value export sectors like wearing apparel.
However, Sri Lanka has a long-standing issue with credibility which can negatively impact the island nations’ prospects of holding on to this valuable set of concessions. Consecutive governments since 2010, have made promises to the EU which were conditional for the GSP+ to be extended, but have failed to deliver. Such failures, despite their domestic implications, paint Sri Lanka as a nation that has weak credibility in the international arena. Despite undertakings to repeal the much-criticised Prevention of terrorism act (PTA) undelivered, and strengthening domestic mechanisms for justice and reconciliation remaining at a standstill, Sri Lanka has little to show in the way of progress other than two peaceful transitions of government and Presidency, sound exercise of democracy and elections without violence, and credible numbers which point to adherence to the IMF bailout programme.
In an October 2021 interview with The Sunday Morning, EU former Ambassador Denis Chaibi pointed out that the European Parliament passed a resolution on 10 June 2021 in which it expressed a number of concerns. “It was mainly about human rights and individual freedoms, with a particular focus on the Prevention of Terrorism Act (PTA) and the shrinking space for civil society to operate. On the Prevention of Terrorism Act (PTA), the resolution expressed grave concern about what is perceived as arbitrary arrest and detention under the PTA, without due process and access to justice. The emphasis is on due process. In other words, for many arrested under the PTA, it would be useful to immediately give those detained a fair trial on valid charges and, if there are no charges, to look at the possibility of releasing them. The resolution also deplores the continuing discrimination against religious and ethnic minorities such as Muslims, Hindus, Tamils, and Christians,” he said.
However, at present (2025), with all that transpired since 2022 to date, the EU’s main focus when it comes to the review seems to be unchanged, with how Sri Lanka deals with the fundamental freedoms of its citizenry, the Prevention of Terrorism Act (PTA), reconciliation process, the space provided for civil society. Meanwhile, improving anti-corruption measures, decriminalising same-sex relations, freedom of association and collective bargaining, and drug control in compliance with human rights commitments, and environmental conventions remain EU priorities.
As such, the Government, which has demonstrated a willingness to improve anti-corruption measures and strengthen the domestic mechanism for justice and reconciliation should move quickly to give confidence regarding their policies and expedite the repeal or replacement of the PTA during their talks with the visiting EU delegation to rebuild Sri Lanka’s credibility and sustain the concessions from the European collective, that the island desperately needs.
https://www.themorning.lk/articles/GpJsAfoEwB8bss9aMJ5R
Prepare a New Proposal to rationalize the Provincial Council System
Provincial Councils Should Act to Improve the Living Conditions of the People
– Says the President at the Governors Meeting
President Anura Kumara Dissanayake instructed the Governors to prepare and submit a new proposal aimed at rationalizing the Provincial Council mechanism.
The President also stated that, given the current government’s transitional period, the provincial councils must strive to deliver the best possible services to improve the living conditions of the people.
President Dissanayake made these remarks during a discussion held with the Governors this morning (22) at the Presidential Secretariat.
He urged the governors to engage in all possible economic and social initiatives to improve the living conditions of the public.
During the meeting, the President also highlighted the importance of establishing a new political culture and reiterated that the trust placed in him by the people should be fulfilled through effective action.
He reminded the Governors to avoid previous poor practices in the use of state assets and to remain committed to delivering quality public service.
Attention was drawn to existing vacancies in the health and education sectors under the Provincial Councils, with decisions made to find viable solutions.
The meeting included discussions on the lands in the Northern and Eastern provinces as well as finance.
Additionally, the President also made inquiries about the allocation of land to farmers in Kantale.
Participating Governors included Nagalingam Vedanayagam from the Northern Province, Champa Janaki Rajaratne from the Sabaragamuwa Province, Professor Jayantha Lal Ratnasekera from the Eastern Province, Kapila Jayasekera from the Uva Province, Bandula Harischandra from the Southern Province, Prof. Sarath Abeykoon from the Central Province, and Wasantha Kumara Wimalasiri from the North Central Province.
https://pmd.gov.lk/news/prepare-a-new-proposal-to-rationalize-the-provincial-council-system/
How important was India’s help to Sri Lanka in 2022?
The IMF program is to give Sri Lanka $ 3 billion over four years with conditions. India gave $ 4 billion in one year to Sri Lanka with no conditions. Also, the timing is important to note. The IMF program came in 2023 when Sri Lanka had stabilised to a large extent under President Ranil Wickremesinghe. Also, most of the toughest policies that were needed for Sri Lanka to achieve macroeconomic stability were already put in place by the former President Ranil Wickremesinghe when the IMF program was approved. But India came to Sri Lanka’s aid when Sri Lanka was staring at the abyss with a Government that was behaving very irrationally in January 2022 with the country facing macroeconomic instability. This point should not be forgotten by the Sri Lankan public
The Maldives is close to an economic crisis similar to which unfolded in Sri Lanka in 2022. The government of Muizzu came to power with an “India Out” campaign. But today, as was the case for Sri Lanka in 2022, when Maldives is in deep economic trouble and is close to defaulting, it is India that has come to its aid. India could have very well looked the other way but it didn’t. This should be a clear message for South Asian nations that they can have many best friends but India will remain the brother who will come to their help when things go bad.
The timing of India’s assistance in 2022
What most people in Sri Lanka do not realise is that India started rolling out its financial assistance totalling $ 4 billion (over the year) in January 2022 itself. Most of India’s $ 4 billion in 2022 came when President Gotabaya Rajapaksa was the President. In January 2022, the situation for Sri Lanka was dark. Sri Lanka needed to pay $ 6.9 billion by the end of 2022 and it only had $ 1.6 billion in reserves. Sri Lanka was shut out of international capital markets. It was staring at a default and the Government at that time was refusing to go to the IMF. Many other countries would have refrained from sending money to Sri Lanka in January 2022 as there was a strong possibility that that money would not be paid back any time soon. But still India went ahead and helped Sri Lanka.
IMF support vs. Indian support
The IMF program is to give Sri Lanka $ 3 billion over four years with conditions. India gave $ 4 billion in one year to Sri Lanka with no conditions. Also, the timing is important to note. The IMF program came in 2023 when Sri Lanka had stabilised to a large extent under President Ranil Wickremesinghe. Also, most of the toughest policies that were needed for Sri Lanka to achieve macroeconomic stability were already put in place by the former President Ranil Wickremesinghe when the IMF program was approved. But India came to Sri Lanka’s aid when Sri Lanka was staring at the abyss with a Government that was behaving very irrationally in January 2022 with the country facing macroeconomic instability. This point should not be forgotten by the Sri Lankan public.
Support given by India in getting IMF assistance
An IMF program is essential for Sri Lanka as the IMF is not about the $3 billion it gives but the verification it brings. The IMF is like an auditor which brings trust to the nation back. World Bank and ADB funding is linked to the IMF and so are debt restructuring with many creditors. India was instrumental in making it easier for Sri Lanka to enter the IMF program. As a former minister was saying that the IMF Managing Director Kristalina Georgieva had told him, that when the Indian Finance Minister Nirmala Sitharaman had met the IMF chief, the Indian Finance Minister had spent over 75% of her time speaking for Sri Lanka and only 25% of her time speaking about India. This shows the care and effort India placed in pushing the IMF to support Sri Lanka. India was also the first country to give financing assurance to the IMF for Sri Lanka and was one of the three key members of the Official creditor Committee along with France and Japan.
Indian Prime Minister’s help for Sri Lanka
A fact that is not mentioned much is the decision of Indian Prime Minister Narendra Modi in helping Sri Lanka. In January 2022, the Indian Prime Minister was two years away from reelection and in India there are many state elections in any given year in which his party, the BJP contests. Providing $ 4 billion to Sri Lanka is a large amount. PM Modi could have very well directed it towards domestic projects. For example, one of PM Modi’s flagship projects under his Production linked incentive scheme (PLI) was where the Indian government gave $ 2 billion worth of subsidies to Micron Technology to produce semiconductors in Gujarat which was to create 5,000 direct jobs and 15,000 indirect jobs.
PM Modi could have easily been tempted to initiate two more projects like Micron in India which could have increased his votes rather than help Sri Lanka with $ 4 billion (which is twice the amount the Indian government directed towards Micron). Putting the well being of Sri Lankans even above domestic interests by the Indian government should not be forgotten by Sri Lankans.
How significant is $ 4 billion for India?
Lastly, what many Sri Lankans need to realise is that $ 4 billion is much more significant for India than for the other bilateral creditors like Japan or even China. India is a lower middle income country and GDP per capita terms, Sri Lanka is still richer than India. In an imaginary situation, let’s say China (as it’s the largest bilateral creditor) and India both provided $ 4 billion in assistance for argument’s sake. China’s economy is almost five times larger than India’s so India’s assistance of $ 4 billion as a proportion of its economic size would be five times more valuable than $ 4 billion from China.
Conclusion
India’s help was significant at a crucial time as Sri Lanka was going through a nightmarish situation in 2022. It is a good time for Sri Lankans to reflect on this crucial bilateral relationship with our neighbour to the north. The way forward does not have to be based on gratitude alone but more on opportunity. India is the fastest growing large economy in the world and soon set to be the third largest economy in the world. India’s middle class alone is set to hit 500 million which is an opportunity for Sri Lankan businesses. Sri Lanka is a country that is known to not miss an opportunity to miss an opportunity. The next big opportunity for Sri Lanka is to our north and hope we do not miss this.
(The writer is an Economist and he is an economic policy consultant at the Asian Development Bank. He is a regular columnist for the International Monetary Fund. The opinions expressed in this article are strictly the author’s
personal views.)
https://www.ft.lk/opinion/How-important-was-India-s-help-to-Sri-Lanka-in-2022/14-768162
Petitioners seek SC intervention against Mannar Wind Power Project citing public interest
The Bishop of the Diocese of Mannar and three prominent environmentalists this week petitioned the Supreme Court in the public interest against the proposed 250 MW Mannar Wind Power Project by Adani Green Energy.
Rev. Dr. Fidelis Lionel Emmanuel Fernando along with Rohan Pethiyagoda, Prof. Nimal Gunatilleke and Prof. Sarath Kotagama have challenged the procurement process and proposed construction of the project by Adani Green Energy PTE Ltd and/or Adani Green Energy S L Limited.
The case names 67 respondents including the Cabinet of Ministers, the Sri Lanka Sustainable Energy Authority (SLSEA), the Central Environmental Authority (CEA), the Board of Investment, the Ceylon Electricity Board, the Public Utilities Commission Sri Lanka and the Attorney General, among others.
It raises concerns regarding the credibility of the project’s environmental impact assessment (EIA) and the role played by the SLSEA. It flags certain procedural issues in the awarding of the purported contract and questions the characterisation of the project as a government-to-government deal.
It questions the basis for the negotiated tariff to be fixed at USD 8.26 cents per kilowatt-hour for a period of 20 years when the EIA conducts its assessment based on a cost of USD 4.6 cents, potentially causing considerable financial loss to the country and a burden on consumers.
The petition also states that, notwithstanding the intensely public nature of the project, its vital importance to the general public and public resources, including the natural environment, as well as the paramountcy of transparency and openness in good governance, “there is a paucity of available data and information”.
It requests Court to compel the release of the entire files and records including the call for bids for (if any) and responses to both the Mannar and proposed 234MW Pooneryn plants; records of deliberations and negotiations; Cabinet memoranda and decisions; unit price discussions including formulae related to the computation of the price per kilowatt hour; the criteria and benchmarks or any other basis for assessments of the project; and other relevant information.
The petition holds that the EIA commissioned by the SLSEA “appears to be a formality, conducted with a premeditated intention/decision to award the construction and operation of the project to predetermined contractors”.
Despite the CEA being the designated body, it appears from publicly disseminated information that the Power and Energy Minister was de facto acting in the capacity of the project approving authority, it states.
There is no transparency surrounding the purported leasing of 202 hectares acquired on Mannar Island for the project; and no information on compensation payable to affected landowners, the cost of which should be recovered from the investor.
The EIA has also not adequately evaluated alternative sites—Ambewela, the South East coast, Kalpitiya and Jaffna—or expressed “any acceptable rationale” for why Mannar Island was chosen.
“The promotion of Mannar when compared to other sites is made even more confounding given that it is the focal point of the Central Asian Flyway for over five million [5,000,000] migratory birds travelling to, and through, Mannar island on an annual basis, making it a crucial area for conservation and tourism which aspects are not as markedly evident in the other sites considered,” the petition states.
In seeking their relief, the petitioners pray that the Supreme Court declares a violation of their fundamental rights and that of the citizenry at large and the decisions made to award the project to Adani as wrongful; and calls for any consequential actions undertaken to be declared illegal.
The petition states that the case has been filed to further the national interest, to preserve and protect public property, including the environment, flora and fauna, public finances and to safeguard the rights and freedoms of the general public of Sri Lanka and its future generations.
https://www.sundaytimes.lk/240616/news/petitioners-seek-sc-intervention-against-mannar-wind-power-project-citing-public-interest-560422.html
Australian company’s multibillion sandmining project mired in Mannar protests
- Protests hinder progress towards mining licence
- Residents allege large-scale land robberies involving brokers working for company
- Environmentalists fear existential threats such as soil losing fertility and contamination of water sources
- Company representative downplays impacts of the project on people’s livelihood
By Mimi Alphonsus and S. Rubatheesan
For over a decade, an Australian company has tried to secure mining licences to extract heavy mineral sands from the ecologically rich region of Mannar Island—the fourth largest ilmenite deposit in the world—with little success.
Renewed attempts to push the project further were met with protests by locals over land usage and severe existential concerns about the environmental consequences.
Renewed attempts to push the project further were met with protests by locals. Pic by Joseph Nayan
The Australian company, Titanium Sands Limited (TSL), along with their local subsidiaries, have engaged in exploration activities covering vast swathes of Mannar Island. Its preliminary scientific studies found key minerals such as ilmenite, rutile, zircon and garnet. According to data from the Geological Survey and Mines Bureau (GSMB), Mannar Island has 53 million metric tonnes of mineral soil.
The company has secured land access agreements for mining on 296 acres, according to the company’s responses to the “Basic Information Questionnaire” (BIQ) submitted to the Central Environmental Authority (CEA). The Sunday Times obtained a copy through a Right to Information (RTI) request.
TSL is currently in discussions with GSMB to secure a mining licence with a pending environmental impact assessment (EIA), which is yet to be finalised due to protests by local communities.
Environmental concerns
The CEA’s Environmental Assessment and Management Division Deputy Director General, N.S. Gamage, told the Sunday Times that they were unable to conduct the required preliminary scoping study before beginning the EIA since residents vehemently opposed the project.
“The project proponent then approached the Presidential Secretariat, which requested a meeting to share information with the public at the Mannar District Secretariat,” said Mr. Gamage.
On May 13, a multi-stakeholder meeting was held at the Mannar District Secretariat to “brief” the local communities, fishermen unions, and civil society groups. There were heated exchanges between company representatives and local communities, who argued that if mining at a depth of 2 to 10 metres is allowed on low-lying land like Mannar Island, it would lead to saltwater contamination and flooding and ruin the fertile soil.
One concerned local among the audience was heard saying, “Don’t try to hoodwink our people with your lies. This is our land. We won’t accept any report you bring forward. If you pay enough, they will write any number of lies in it.”
Mannar District Secretary K. Kanakeshwaran also acknowledged receiving multiple complaints and petitions from local communities opposing the multibillion-dollar project.
During the meeting, the mining company representatives downplayed the short- and long-term impacts of the project.
Sivanesan Somanathar, an environmental consultant commissioned by TSL, said that an EIA would be necessary to assess all environmental risks and that many concerns could be mitigated.
In his presentation, he said there would be “no dewatering” and “no saltwater intrusion” and assured replanting of whichever vegetation the landowner preferred after the project’s completion.
The project BIQ submitted by the company to CEA indicated short-term impacts on soils and land use, surface and groundwater quality, and drainage and hydrology, as well as medium-term impacts on the landscape and visual environment.
GSMB’s Senior Director of Geology Starin Fernando dismissed claims that exploration drilling below the water table is harmful. “However, at the mining stage, if it goes below the water table, there will be saltwater intrusion,” he said. However, he said GSMB does not deal with this problem, and the National Water Supply and Drainage Board should provide tentative solutions.
Environmentalists and conservators raised serious concerns about the long-term impact of the project on a rich biodiverse region like Mannar Island, which is home to 874 hectares of mangrove plants and located in the global migratory path of some 400 bird species.
The 31,135-acre Mannar Island where the proposed project will be implemented is a highly populated area with 70,379 people residing there.
For Dr. Soosai Anandan, a retired Professor of Geography at the University of Jaffna, this project sounds the death knell for local habitats and communities who are still struggling to revive the rural economy after the end of the civil war in 2009.
“This project, if implemented, will not only change the landscape and terrain of the island as a whole but further accelerate the existing livelihood issues such as access to safe drinking water, farming and fishing,” Prof. Anandan said.
“The island is already below sea level. When they drill and mine in this sensitive region, the seawater will seep through the land, posing a threat to farming and drinking water,” he said.
Land Issues
Another point of contention has been land access for the project. “My family had 35 acres of palmyrah land for generations,” said a resident of Olaithoduvai who sells palmyrah toddy, fronds and firewood for a living.
“It is our ancestral wealth, but we don’t have title deeds for it. When they brought in these private land ownership laws decades ago, our people did not know how to get this land registered,” he explained. “Suddenly, big landlords from other villages started to fence it up in recent years, and, shortly after, big machinery appeared. I can’t access the palmyrah forest on that land and earn my income.”
Other residents are fearful that their livestock will lose access to grazing lands due to landscape changes. According to the BIQ, 60% of the lands proposed for mining are forested areas, and the project will require the removal of topsoil and vegetation.
The Sunday Times inspected government survey maps and spoke to the Land Title Settlement Department to understand the land problem. In several areas where TSL claims that land access agreements have been procured, ownership is tagged as “claimant not known.”
Mannar has hundreds of acres of land with unclear ownership or disputed cases, partly due to delays in drawing up a “village plan” by the Land Title Settlement Department but also owing to decades of wartime displacement. As a result, communities that have lived and worked there for generations are vulnerable to land grabbing.
Local officials who requested anonymity told the Sunday Times that TSL and other companies have been procuring land on Mannar Island by signing agreements with individuals who have made a “declaration deed,” a legal document claiming ownership.
“The government will only register a property if they are 100% sure of its ownership, but a company need not adhere to the same standard and can make agreements with whoever claims the land and is willing to give it to them,” explained the official. “Once they make a declaration deed, they transfer it a few times so it has a history and becomes normalised.”
Although not illegal, the official believes the process is being abused.
Villagers whose lands were utilised for exploration activities allege that middlemen, who collected land details and approached them individually with false promises to secure land access, later handed these properties over to the mining company.
“This way, they can pay a small sum to the aggrieved family and get them not to claim the land.” Another resident said she and her family agreed to hand over their lands to a big landowner as they had no deeds to challenge his claim. “They promised to pay us money in return, but I haven’t received a cent,” she alleged.
Saliya Galagoda, TSL’s local representative, acknowledged that large landowners were fencing off properties in sand mining areas, but he said they were doing so of their own volition and solely to increase the price when mining companies try to access the land.
Mistrust in the project also stems from years of secretive practices adopted by various companies to secure access to the land. Residents said that for years, local companies and brokers approached them for exploration by saying they were “checking the water,” “researching sand,” and part of a “government project.”
Speaking on condition of anonymity, a former broker who worked for one such company said that they would use “politically big people” to ensure villagers didn’t question the project too much. “Because people knew who I was in the community, they let me enter and explore their lands,” he said. “I don’t feel good about it.”
TSL’s Galagoda, who took over the project in 2021, said that since he started working, things have been done “correctly.” “We paid Rs. 12,500 for every single hole that was drilled,” he added.
While the application for a mining licence at the moment covers a relatively modest area, TSL currently has over 17,000 acres—more than half of Mannar Island—under retention. According to the GSMB licensing process, TSL has one to two years to apply for and receive a mining licence before retention expires permanently.
TSL complains of delays in obtaining approval Despite nearly two years passing since Titanium Sands Ltd. (TSL) completed exploration activities, the company is awaiting approvals to begin the environmental studies. It says this is “something that has continually been delayed by the political situation in Sri Lanka.” In a written response to the questionnaire sent by the Sunday Times, TSL Director Jason Ferris claimed the company has so far invested Rs. 2 billion from foreign sources on the project, and another Rs. 24 billion will be invested once the mining licence is approved. “Exploration was only completed in 2022, and the final resource report was presented to GSMB in September 2022, which was accepted and signed off by GSMB. Since this time, the company has been waiting on the government process for each of the next stages; so the official mining licence process has been ongoing for approx. 18 months, not 10 years,” Mr. Ferris said. Responding to the cancellations of exploration licences for TSL-owned companies in 2021 and their subsequent renewal, the company said “under legal opinion, the structure of TSL was proven correct and new licences were issued.” TSL denied receiving any benefits through tax holidays but indicated that “BOI discussions are ongoing along with the EIA discussions, which are constantly delayed by government departments not doing their jobs.” https://www.sundaytimes.lk/240616/news/australian-companys-multibillion-sandmining-project-mired-in-mannar-protests-560380.html |
Sri Lanka ready to join BRI phase two, China FTA to be expedited
ECONOMYNEXT – Sri Lanka is among countries ready to join the second phase of China’s Belt & Road Initiative (BRI), with a free trade agreement (FTA) between the two countries to be also expedited, according to a discussion between President Ranil Wickremesinghe and a top Chinese official.
Wickremesinghe told visiting special envoy of the Chinese President, state councillor Shen Yiqin, that the BRI is expected to make a more substantial economic contribution, according to a statement from the president’s office said Monday November 20 afternoon.
China is also prioritising the extension of a China-Myanmar Economic Corridor to the island nation, according to Yiqin.
This was during a courtesy call paid by President Xi Jinping’s envoy to President Wickremesinghe Monday morning in Colombo. Both parties also agreed to expedite the implementation of the China-Sri Lanka Free Trade Agreement, the statement said.
The primary focus of the meeting was to enhance tourism and trade relations between the two countries, according to the statement.
“The President expressed gratitude for China’s support to Sri Lanka, notably acknowledging their assistance in the country’s debt restructuring programme. He extended sincere thanks to the Chinese President and the government for their invaluable support in this regard,” the statement said.
Wickremesinghe also expressed Sri Lanka’s desire to augment cooperation between the two countries in the fields of tourism, sports and agriculture . Both the Hambantota Port and Colombo Port City are currently prepared for investment opportunities, he said.
“The President also noted that countries such as Sri Lanka, participants in the Belt & Road initiative, are prepared to embark on the second phase of the initiative, which is expected to make a more substantial economic contribution.
“The President outlined the measures taken by Sri Lanka to access the Regional Comprehensive Economic Partnership (RCEP), and further affirmed Sri Lanka’s commitment to preserving the Indian Ocean as a free zone for navigation and ensuring it remains a peaceful region, free from global geopolitical rivalries.”
The visiting Chinese official has said her government is prioritising the extension of the China-Myanmar Economic Corridor to Sri Lanka.
Yikn reaffirmed China’s enduring support to Sri Lanka and emphasised her commitment to strengthening the relations between the two countries, the president’s office said. (Colombo/Nov20/2023)
Sri Lanka ready to join BRI phase two, China FTA to be expedited
Harsha exposes flaws in 2024 Budget in hard hitting critique
- Alleges blatant violation of the Fiscal Management Responsibility Act in Budget 2024, with Budget deficit exceeding 5%
- Says staggering increase in poverty affecting 3 to 7 million people, highlighting a critical issue overlooked in Budget
- Critiques Govt.’s “Oxymoron” economic approach and absence of a comprehensive plan for making Sri Lanka an advanced economy by 2048
- Says tax burden is excessively high, risking a decline in consumption, business failures, and an exodus of professionals
- Reveals 18% VAT items list; calls it unfair; alleges COL allowance hike an eyewash
- Expresses gratitude to petitioners who played pivotal role in recent Supreme Court verdict on economic crimes
- Calls for a parliamentary discussion on civic rights of those found guilty of bankrupting Sri Lanka
- Proposes robust measures to combat corruption, including the implementation of STAR program
- Emphasises reservations regarding Macro-linked Bond (MLB) proposal, says it raises questions about potential benefits favouring external investors over provident fund workers during debt restructuring
- Argues a 30% haircut is inadequate for ensuring debt sustainability, underscoring need for a more comprehensive and equitable approach
- Says urgency for transparency, accountability, and a visionary approach for a new economic trajectory
Ina compelling address toParliament, main Opposition Samagi Jana Balawegaya (SJB) MP Dr. Harsha de Silva delivered a comprehensive critique of Budget 2024, shedding light on critical issues that demand urgent attention.
De Silva, who is also the Committee on Public Finance (COPF) Chairman, meticulously outlined the shortcomings and concerns surrounding the economic policies proposed in the budget, providing a stark contrast to the optimistic claims made by the Government.
Dr. de Silva commenced by pointing out a blatant violation of the Fiscal Management Responsibility Act (FMRA) within Budget 2024, citing an alarming budget deficit exceeding 5%.
He substantiated his concerns by referencing reports from LirneAsia, the World Bank, and UNDP, revealing a staggering increase in poverty affecting 3 to 7 million people. The multi-dimensional vulnerabilities highlighted by UNDP underscored the severity of the crisis, with over 50% of those affected categorised as multidimensionally poor.
De Silva expressed gratitude to petitioners who played a pivotal role in the recent Supreme Court verdict on economic crimes. He emphasised that the court›s rigorous discussion identified key figures, including Mahinda Rajapaksa, Gotabaya Rajapaksa, Basil Rajapaksa, Ajith Nivard Cabraal, and Dr. P.B. Jayasundara et al, as responsible for the economic downturn, pushing over 4 million people into poverty. He called for a parliamentary discussion on the civic rights of those found guilty of bankrupting Sri Lanka.
Contrary to the President›s claims of stabilised inflation and economic equilibrium, de Silva cited CBSL former Deputy Governor W.A. Wijewardene›s statistics. The cost of living for a family of four, he revealed, had surged from Rs. 91,880 in January 2021 to Rs. 175,490, illustrating a 91% increase in the last two years.
Labelling the current Government as an «Oxymoron,» SJB MP drew a parallel to Shakespeare›s Romeo & Juliet. In this case, ‘being together is such a sweet sorrow’. He raised questions about the legitimacy of the Government›s economic vision. MP Harsha presented a scientific analysis of the growth targets set by the Government. To achieve advanced economic status by 2048, he highlighted the necessity of a growth rate of 6.4% from 2027 to 2048. He challenged alternative claims, stating that even growing at 3% would delay reaching advanced economy status until 2068.
De Silva dissected Budget 2024, emphasising three critical pillars for Sri Lanka›s recovery: eradicating corruption, creating economic opportunities, and ensuring social equity. The seasoned politician delved into each point, offering a pragmatic assessment and proposing viable alternatives.
Need to combat corruption
He underscored the need for robust measures to combat corruption across various sectors. He criticised the absence of tangible anti-corruption initiatives, citing examples like the cricket scandal, sugar tax scam, and fraudulent activities in the liquor industry. The SJB parliamentarian questioned the Government’s inaction and proposed the implementation of the Stolen Assets Recovery (STAR) program and the establishment of an independent prosecutor’s office, as outlined in the SJB blueprint.
Moving to the second point, de Silva highlighted the importance of creating economic opportunities for youth in rural areas, empowering entrepreneurs, supporting small and medium businesses, and ensuring fair prices for farmers. He argued that eradicating corruption alone is insufficient and advocated for a broader economic vision.
In his exploration of the third key aspect, the SJB MP shed light on the complexities of fiscal consolidation and expenditure reduction, emphasising the profound implications for social equity. Despite the President’s focal point on revenue-based fiscal consolidation, concerns surfaced regarding the comparatively meagre attention given to reducing overall expenditure.
He acknowledged challenges in curtailing expenditure, particularly in vital sectors like Health and Education, allocated a modest 1.7% of GDP. However, he expressed reservations about funding directed to loss-making SOEs, exemplified by SriLankan Airlines, which sought Rs. 110 billion to settle liabilities to Ceylon Petroleum Corporation (CPC) recently. This raises concerns about fairness in comparison to the total expected revenue from PAYE of Rs. 100 billion annually or essential needs like children’s uniforms, a significant 27 times less.
Criticism was directed toward the extension of tax breaks, citing the Strategic Development Projects (SDP) Act and recent Supreme Court rulings on preferential tax treatment for associates, resulting in substantial losses to the Treasury.
He said a historical lens revealed a stark decline in Government revenue from 20-21% of GDP in 1994 to a current low of 8%, framing a narrative of economic transformation. The disparity between IMF revenue targets (15% of GDP by 2026) and the anticipated 10.2% for 2023 was underscored, calling for a substantial 2.5% increase, equivalent to Rs. 1229 billion.
Fairness and transparency for tax changes
However, concerns were articulated regarding proposed tax changes, especially their disproportionate impact on citizens through heightened consumption taxes. For example, the VAT hike from 15 to 18% and the removal of VAT exemptions for items like petrol, diesel, gas, and fertiliser could drive inflation up and consumption down. He called for fairness and transparency advocating for the disclosure of tax changes to Parliament, ensuring public awareness amid talks of Government giveaways.
De Silva proposed the Government implement his revised PAYE tax structure, significantly reducing the burden on professionals while still achieving the expected income. The MP lamented the lack of response from the Ministry of Finance to their proposal, contrasting it with the President’s call for cooperation.
Rallying cry for comprehensive reforms
In a dramatic climax, de Silva concluded that the proposed tax burden is excessively high, risking a decline in consumption, business failures, and an exodus of professionals from Sri Lanka.
His impassioned critique serves as a rallying cry for comprehensive reforms, emphasising the urgency of addressing corruption, fostering economic growth, and ensuring social justice to pave the way for Sri Lanka’s resurgence.
Acknowledging the Government’s efforts to broaden the tax net, de Silva highlighted initiatives such as the requirement for a Tax Identification Number (TIN) to open a bank account, obtain building permits, register vehicles, or renew revenue licence.
These measures, while commendable, de Silva said set the stage for a broader conversation about Sri Lanka’s economic trajectory, moving beyond stability to growth.
He stressed the imperative of transcending mere economic stability and transitioning towards sustainable growth. He referenced the International Monetary Fund’s (IMF) expectation for Sri Lanka to achieve debt sustainability by 2027, emphasising the challenges posed by a projected debt-to-GDP ratio of 104%, significantly exceeding the internationally accepted norm of 60%.
Expressing concern over the staggering debt-to-GDP ratio, de Silva underscored the potential ramifications, particularly the substantial interest payments. With interest payments for 2024 reaching a staggering Rs. 2,651 billion against revenue of Rs. 4,127 billion, he pointed out that Sri Lanka could become the world’s top contributor to interest payments relative to Government revenue.
Raising pertinent questions, the SJB MP inquired about the status of discussions with the Exim Bank of China and the agreement of the Paris Club, questioning the transparency of the process. He delved into the controversial Macro-linked Bond (MLB) proposal, expressing reservations about its potential benefits favouring external investors over the workers in provident funds who bore the majority of the burden during debt restructuring.
He passionately urged authorities not to bind future administrations to what he perceived as an unjust deal with International Sovereign Bond (ISB) holders. Furthermore, he reiterated that a 30% haircut is insufficient for debt sustainability. He questioned the beneficiaries of specific bonds, including the $500 million bond, and sought clarity on the ownership of Hamilton Reserve bonds amounting to $250 million. The recent Supreme Court decision added further complexity, prompting Harsha to call for transparency in navigating the fiscal challenges.
Expressing concerns about the stability of the banking system, de Silva questioned the lack of information on the promised asset quality review by the President. He delved into the Budget’s allocation of Rs. 450 billion for bank recapitalisation in 2025, emphasising the President’s acknowledgment that this amount may be insufficient.
The proposed 20% privatisation of the Bank of Ceylon (BOC) and People’s Bank was commended as a move towards stability and accountability, free from political influence.
De Silva painted a challenging picture for Sri Lanka’s future debt issuance, projecting a debt of $ 68 billion by 2027. He raised critical questions about sourcing the required funds through taxes and the conversion of tax revenue into dollars. Addressing this, he emphasised the necessity of increasing forex reserves and advocated for a growth-oriented production economy.
Need for mindset shift to achieve higher growth rates
In a sharp critique of the current Government’s approach, the SJB MP highlighted the need for a mindset shift to achieve higher growth rates. He underlined the importance of breaking down barriers and reducing red tape to connect with global production networks. Referencing opposition to the Sri Lanka/Singapore Free Trade Agreement (FTA) by certain political entities, he advocated for an open-minded approach to foster economic growth.
Drawing inspiration from former President J.R. Jayewardene’s initiatives in the 1970s, de Silva emphasised the role of investments in building capital, especially in a country with low savings. He urged the creation of an environment conducive to entrepreneurs, promoting foreign direct investments as a means to fuel economic growth.
He proposed creative solutions such as building wind farms in Mannar and connecting Sri Lanka to India’s grid to earn valuable forex by exporting power to South India. He challenged conventional thinking, advocating for an open mindset in generating forex through innovative and collaborative projects.
De Silva ‘s comprehensive address underscores the intricate challenges facing Sri Lanka’s economic landscape and proposes strategic reforms to navigate the country towards equitable growth. His impassioned plea for transparency, accountability, and a visionary approach serves as a rallying cry for a new economic trajectory.
Ex-Tourism Chief recommends preserving historic Nuwara Eliya Post Office
Former Sri Lanka Tourism Chairperson Kimarli Fernando suggested yesterday to consider switching the President’s Nuwara Eliya residence into a hotel as an option if demand arises for additional accommodation.
She voiced her concerns over the Government’s decision to convert the historic Nuwara Eliya Post Office into a hotel, acknowledging the ‘excess’ room capacity in upcountry city.
“Nuwara Eliya currently has excess room capacity. Should there be a need for more rooms, converting the President’s Nuwara Eliya house, to a hotel, could be considered in the future, if needed,” she said via her Facebook account.
On Monday the Cabinet of Ministers approved a proposal presented by President Ranil Wickremesinghe in his capacity as the Investment Promotion Minister to convert Nuwara Eliya Post Office into a hotel.
“Taj Group has proposed converting the Nuwara Eliya Colonial-era Post Office into a hotel. The proposal came to the Presidential Secretariat and the specifics will be made available by the Secretariat once the project gets off the ground,” Cabinet Co-Spokesman and Minister Bandula Gunawardana confirmed at the post-Cabinet meeting media briefing on Tuesday.
Fernando said the Post Office in Nuwara Eliya, the Tudor-style two-storey red-brick building with a clock spire, was constructed in 1894 by the British. Sri Lanka Post has been in existence for more than 209 years, with a proud history and heritage.
“It should remain as a working Post Office. If management needs to be shared to uplift, where income is shared, a unique memorabilia museum, store or tea boutique could be considered, to generate income,” she noted.
China renews support for Sri Lanka
- President Wickremesinghe finally meets Chinese counterpart Xi Jinping in Beijing
- Xi assures China will continue to provide assistance to Sri Lanka without any political strings attached
- Says China and Sri Lanka should strengthen collaboration on international and regional affairs, oppose politicisation of the human rights issue and bloc confrontation, and safeguard the common interests of developing countries
- Expresses China’s willingness to import more quality and specialty products from Sri Lanka and encourage Chinese enterprises to invest and do business in Sri Lanka
- Says China glad to see Sri Lanka becoming a commercial centre in the Indian Ocean
- China stands ready to work with Sri Lanka to jointly promote high-quality Belt and Road cooperation and push for new progress
- Commends Wickremesinghe’s speech at UN General Assembly for reflecting strategic independence, neutral stance; Sri Lanka’s support for “Belt and Road” initiative
- Assures friendly, practical and timely support for Sri Lanka’s debt optimisation program
- SL expresses appreciation for China’s longstanding support
- Wickremesinghe shares vision to set up maritime economic corridor linking China, Myanmar, Sri Lanka and South Africa; Xi points to challenges; encourages Sri Lanka to take the lead
In a significant diplomatic encounter, President Xi Jinping yesterday extended China’s unwavering commitment to aiding Sri Lanka in achieving economic stability and progress, devoid of any political agenda.
This gesture was made during a meeting at the Great Hall of the People Beijing with President Ranil Wickremesinghe who was on a four-day official visit to China attending the third Belt and Road Forum for International Cooperation. It was also the first Presidential-level meeting since Wickremesinghe assumed office 14 months ago. China is the largest lender for Sri Lanka apart from being the biggest investor and the second biggest source for imports.
“China will continue to provide assistance to Sri Lanka without any political strings attached and help the country cope with difficulties concerning its society and people’s livelihood,” Xi was quoted as saying by Xinhua.
Xi also said China and Sri Lanka should “strengthen collaboration on international and regional affairs, oppose politicisation of the human rights issue and block confrontation, and safeguard the common interests of the two countries and developing countries,” Xi said.
Xinhua also said Xi had expressed China’s willingness “to import more quality and specialty products from Sri Lanka’, and encourage “Chinese enterprises to invest and do business in the country”, so as to help Sri Lanka transform and upgrade its economy and achieve sustainable development. Xi added that “China is glad to see Sri Lanka becoming a commercial centre in the Indian Ocean.”
Xi acknowledged that Sri Lanka was one of the first countries to join the Belt and Road Initiative and China stands ready to work with Sri Lanka “to jointly promote high-quality Belt and Road cooperation and push for new progress” in developing China-Sri Lanka strategic cooperative partnership featuring sincere mutual assistance and lasting friendship. Senior Chinese officials Cai Qi and Wang Yi attended the meeting.
The President Media Division (PMD) in its communique said the Chinese President acknowledged that Sri Lanka’s speech at the United Nations General Assembly, delivered by President Wickremesinghe, reflected the country’s strategic independence and its neutral stance.
During the discussions, President Xi reaffirmed China’s adherence to the “One China” policy and conveyed gratitude for Sri Lanka’s support for the “Belt and Road” initiative. He underscored the port city and Hambantota port as pivotal projects within this framework, pledging to boost imports of Sri Lankan goods to China and amplify investments in Sri Lanka.
Furthermore, he affirmed China’s intent to provide supportive, practical, and timely assistance for Sri Lanka’s debt optimisation program.
Touching on the historical ties between China and Sri Lanka, President Jinping referenced travel accounts by the Faxian monk and Zheng He, the PMD communique said.
It said in response, President Wickremesinghe expressed his appreciation for China’s longstanding support to Sri Lanka and commended President Xi Jinping for his consistently friendly attitude towards Sri Lanka.
Wickremesinghe also unveiled Sri Lanka’s vision to establish a maritime economic corridor linking China, Myanmar, Sri Lanka, and South Africa. Acknowledging the challenges inherent in such a venture, President Jinping encouraged Sri Lanka to take the lead.
The conversation underscored the pivotal role of Sri Lanka as an economic hub in the Indian Ocean region, with President Wickremesinghe reaffirming the country’s commitment to preserving peace and the identity of the region.
He advocated for collaborative efforts between India and China to propel development in Asia.
PMD said President Wickremesinghe further revealed Sri Lanka’s aspiration to attain developed status by 2048, citing the robust foundation laid by the eight-step program unveiled at the third “Belt and Road” forum for International Cooperation.
He informed the Chinese President about plans to construct a Sri Lankan Buddhist temple and stupa in commemoration of the visit of Faxian monk to Sri Lanka and President Xi Jinping expressed China’s support for these activities.
Additionally, the leaders delved into discussions concerning the ongoing conflict in the Gaza Strip.
Notable figures present at the event included Foreign Affairs Minister Ali Sabry PC, President’s Senior Adviser on National Security and Chief of Staff Sagala Ratnayaka, Central Bank Governor Dr. Nandalal Weerasinghe and President’s Private Secretary Sandra Perera.
https://www.ft.lk/top-story/China-renews-support-for-Sri-Lanka/26-754334