Sri Lanka perspectives: November 2015

Col R Hariharan

Sri Lanka economic policy

In keeping with the United National Party (UNP)’s strong commitment to economic and social sector reforms, deregulation and private sector development, Prime Minister Ranil’s Wickremesinghe presented in parliament his government’s economic policy based on social market economy. This marks a departure from President Mahinda Rajapaksa’s model which halted the privatization process and launched several new companies and grandiose projects under the state.

This was to be achieved through an export-oriented model to be followed for the next five years. Strategies proposed to be adopted include turning Colombo into a financial hub, the creation of a mega city in the Western province on the lines of Singapore and Dubai, creation of sector-specialized technology, business and development of tourism zones across the country.

In keeping with the economic policy, the budget 2016 aims at achieving two quantitative targets: reduce the high budget deficit to 3.5 per cent by 2020 and transform the tax structure which is skewed towards indirect tax to reduce its contribution from 80 per cent of the revenue to 60 per cent and increase direct taxes contribution from 20 per cent to 40 per cent. It also would like to reduce loss making state enterprises and set up a pension fund for social security, improve investment climate through low tax regimes and land ownership and protection of business, and improve tourism, infrastructure and public services

The moot point is can Sri Lanka achieve these ambitious economic objectives?  It is not going to be easy for Sri Lanka to enforce its economic strategy as it is heavily dependent upon external resources. Foreign resources will only flow only if investor confidence is improved. Only sustained structural reform process can tone up the system. Public expenditure needs to be disciplined despite political compulsions and endemic corruption has to be tamed.  This might look a tough prescription given

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 past experience; but Sri Lankans need to be optimistic about the future given their strong basics: geographic advantages of location, ocean resources and sustained human resource development than other nations of the region.

Sri Lanka has already made some progress in recouping international goodwill lost due to Rajapaksa government’s to negative response to global concerns on its poor human rights, unchecked aberrations of governance and endemic corruption. But this is only the beginning of the process.

On the human rights front Sri Lanka has tried to tackle the issue on through multiple initiatives. It managed to convince the UN Human Rights Council (UNHRC) members of its sincerity in addressing their concerns by sponsoring the resolution on a domestic investigation into the rights violations with an international component.

It has tried to defuse the atmosphere of fear and confrontation that had existed in Northern Province though the progress is slow. For example, unlike the earlier years after the Eelam War, Tamil families who had lost their kin in the Eelam War were allowed to mourn on November 27 LTTE’s Martyrs Day and chose to play it down.

The government has tried to introduce greater transparency in governance. For instance it has published detailed reports of inquiry commissions appointed to investigate allegations of enforced disappearances as well as war crimes committed by both sides during Eelam War.

But the weakest link in governance appears to be corruption. Despite public pronouncements against corruption, sloppy progress in some of the serious corruption investigations has given rise to suspicion of intentional delay to save some political elements within the government. Typical is the ‘floating armoury’ case in which former defence secretary Gotabaya Rajapaksa was suspected to be involved. The case related allegations of money laundering, gun running and corruption in the operations of Avant Garde Maritime Services (AGML), which operated two ships MV Avant Garde and MV Mahanuwara as floating armoury for depositing weapons of private security personnel on piracy protection duties aboard merchant vessels. When allegations of gun running cropped up both the ships were searched on shore and there were discrepancies in their weapon inventories. The whole investigation started in March 2015 has been marred by contradictory stands of the Navy and the CID and the concerned ministers.  In the latest twist when MV Avant Garde was searched by Navy on the orders of the President in October 2015, again there were discrepancies in accounting for the 817 weapons found on board. And the merry go round continues.

Ban on Tamil Diaspora bodies lifted

The government has lifted the ban on several of the 15 Tamil Diaspora bodies, which were suspected of links with the LTTE and banned by the Rajapaksa regime. The organizations on which the ban was repealed included the Global Tamil Forum (GTF), the British Tamil Forum (BTF), Australian Tamil Congress (ATC) and the Canadian Tamil Congress (CTC) among others. The government order also lifted the ban on the head of the Global Tamil Forum, Father SJ Emmanuel who left the country in 1997.

The lifting of the ban is part  the Sirisena government move for rapprochement with Tamil Diaspora groups for their positive contribution  to the reconciliation process with Tamil minority.  Earlier this year, Foreign Minister MangalaSamaraweera had talks with the GTF in London. Representatives of the Tamil National Alliance and former Norwegian peace envoy Erik Solheim also attended the talks.

However, the Transnational Government of Tamil Eelam (TGTE), the post war overseas clone of the LTTE, and its leader and former LTTE attorney V Rudrakumaran continue to be among the proscribed organizations and individuals.  This was not unexpected as creation of an independent Eelam State continues to be the objective of the TGTE. 

The lifting of the ban is a positive step that would be welcomed by India as it would encourage the process of bringing back Tamils into national mainstream.

Written on November 30​, 2015

[Col R Hariharan, a retired Military Intelligence specialist on South Asia, served with the Indian Peace Keeping Force in Sri Lanka as Head of Intelligence 1987-90. He is associated with the Chennai Centre for China Studies and the South Asia Analysis Group. E-Mail:haridirect@gmail.com  Blog: http://col.hariharan.info]

 Courtesy: South Asia Security Trends, December 2015 www.security-risks.com