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Thursday February 29th, 2024

India’s official invitation for Sri Lanka’s Marxists seen positive amid political concerns

ECONOMYNEXT – India’s unprecedented invitation to Sri Lanka’s Marxists Janatha Vimukthi Peramuna (JVP) for an official visit is seen as positive to proceed with Delhi’s plans in the island nation without resistance but also has raised political concerns ahead of presidential polls this year.

The JVP-led coalition National People’s Power (NPP) has gained more popularity in the recent past after the 2022 mass protests that forced former president Gotabaya Rajapaksa to flee the country and his brother, ex-Prime Minister Mahinda Rajapaksa, to resign amid an unprecedented economic crisis.

Political analysts and diplomats say JVP has now become a formidable political force in Sri Lanka after the policies of two main parties with center-right and center-left thoughts have failed the nation in their 76 years of ruling since the 1948 independence.

Though the island nation does not have accurate surveys on the popularity of political parties, informal surveys show people may elect a JVP-led government. The JVP has been a populour party in the past Sri Lankan elections as well, but it failed to capitalize it to win poll, analysts say.

JVP has promised to end corruption, ensure a new governance system, punish corrupt politicians and government officials, and change policies to improve the livelihoods of lower income groups.

The JVP was involved in two armed uprisings against the Sri Lankan government in 1971 and 1987-89. The motive for both uprisings was to establish a socialist state. However, both insurgencies were defeated with annihilation of Marxists youth.

The party, which earlier had trained militants, is currently led by 55-year-old Anura Kumara Dissanayaka who has been in the parliament for more than 23 years and once held cabinet minister portfolios for 14 months in 2004/5 period.


Dissanayaka and his party members have always raised concerns and protested against successive Sri Lankan governments’ decision to award key infrastructure projects to neighbour India.

The JVP strongly protested against an agreement between both Sri Lanka and India in 1987, citing that the move was infringing the island nation’s sovereignty and territorial integrity while allowing an Indian Expansionism.

India, for the first time in its history, invited a JVP leader for an official visit.

Dissanayaka and his team members met Indian External Affairs Minister S. Jaishankar, National Security Adviser Ajit Doval, and Foreign Secretary Vinay Mohan among many others.

“..We discussed regional security and bilateral relations between Sri Lanka and India,” Dissanayaka said in X (Twitter) platform after meeting Doval.

Indian External Affairs Minister S. Jaishankar said he held a “good discussion” on the bilateral relationship and the mutual benefits from its further deepening”.

“Also spoke about Sri Lanka’s economic challenges and the path ahead. India, with its Neighbourhood First and SAGAR policies will always be a reliable friend and trusted partner of Sri Lanka,” Jaishankar said in his X platform.

The visit comes as Sri Lankan President Ranil Wickremesinghe has signaled to hold presidential polls in October this year and Parliamentary polls in early 2025.

The official invitation has been also offered as India is in the move to proceed with ambitious renewable wind and solar power projects, Investment Zone in Trincomalee, oil and gas pipeline deals which is expected to ensure continuous fuel supply to Sri Lanka, and airports among many others.

Dissanayaka’s JVP members have been resisting most Indian projects stating that India has been siphoning Sri Lanka’s wealth through such projects. India has denied the JVP claims.


“It’s good that they discuss, understand, and realize the truth (on Indian projects) instead of coming up with a lot of fake allegations,” Sri Lankan Foreign Minister Ali Sabry told reporters on Tuesday (06) when asked about Dissanayaka’s Indian visit.

“I see it in a positive way,” he said.

“I like it because we have been continuously saying that India is our neighbour with a large market of 1.4 billion people.  India will be the focal point of development in the future. We also have to partner in that development and grab the opportunity.”

Indian media on Dissanayake’s visit said the JVP leader taking a pro-India position comes in stark contrast to the stance taken by his party in late 1980s.

Dissanayake acknowledged the shift in the JVP’s stance and stated that any decision that the island nation makes should be done so in keeping view of the impact it has on India, they reported.

“We do know that India, who is our closest neighbour, has become a major political and economic centre. So, when we take economic and political decisions, we will always care about how it will impact India,” Dissanayake was quoted as saying by Indian newspaper The Hindu last year.

The Hindu said Dissanayaka’s visit, and meetings assume greater significance, coinciding with his rising popularity in the domestic political sphere in a crucial election year.

Sri Lanka’s ruling party MP Namal Rajapaksa, son of former President Mahinda welcomed Dissanayake’s Indian visit, stating that it signals a potential shift in the JVP stance on Indian investments which the JVP had for years criticized and neglected.

“The JVP has now reached a different view and has engaged in a tour to India, which is a good thing,” Namal was quoted as saying in Sri Lanka’s Daily Mirror.

The Marxists, who have leaned towards protectionism, have also opposed Chinese deals as well including Colombo Port City and Hambantota Port which are given to China on a 99-year lease. (Colombo/Feb 07/2024)

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Sri Lanka’s RAMIS online tax collection system “not operatable”: IT Minister

ECONOMYNEXT – Sri Lanka’s online tax collection system RAMIS is “not operatable”, and the Ministry of Information Technology is ready to do for an independent audit to find the shortcomings, State IT Minister Kanaka Herath said.

The Revenue Administration Management Information System (RAMIS) was introduced to the Inland Revenue Department (IRD) when the island nation signed for its 16th International Monetary Fund (IMF) programme in 2016.

However, trade unions at the IRD protested the move, claiming that the system was malfunctioning despite billions being spent for it amid allegations that the new system was reducing the direct contacts between taxpayers and the IRD to reduce corruption.

The RAMIS had to be stopped after taxpayers faced massive penalties because of blunders made by heads of the IT division, computer operators and system errors at the IRD, government officials have said.

“The whole of Sri Lanka admits RAMIS is a failure. The annual fee is very high for that. This should be told in public,” Herath told reporters at a media briefing in Colombo on Thursday (29)

“In future, we want all the ministries to get the guidelines from our ministry when they go for ERP (Enterprise resource planning).”

President Ranil Wickremesinghe’s government said the RAMIS system will be operational from December last year.

However, the failure has delayed some tax collection which could have been paid via online.

“It is not under our ministry. It is under the finance ministry. We have no involvement with it, but still, it is not operatable,” Herath said.

“So, there are so many issues going on and I have no idea what the technical part of it. We can carry out an independent audit to find out the shortcomings of the software.”

Finance Ministry officials say IRD employees and trade unions had been resisting the RAMIS because it prevents direct interactions with taxpayers and possible bribes for defaulting or under paying taxes.

The crisis-hit island nation is struggling to boost its revenue in line with the target it has committed to the IMF in return for a 3 billion-dollar extended fund facility. (Colombo/Feb 29/2024) 

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Sri Lanka aims to boost SME with Sancharaka Udawa tourism expo

ECONOMYNEXT – Sri Lanka is hosting Sancharaka Udawa, a tourism industry exhibition which will bring together businesses ranging from hotels to travel agents and airlines, and will allow the small and medium sector build links with the rest of the industry, officials said.

There will be over 250 exhibitors, with the annual event held for the 11th time expected to draw around 10,000 visitors, the organizers said.

“SMEs play a big role, from homestays to under three-star categories,” Sri Lanka Tourism Promotion Bureau Chairman, Chalaka Gajabahu told reporters.

“It is very important that we develop those markets as well.”

The Sancharaka Udawa fair comes as the Indian Ocean island is experiencing a tourism revival.

Sri Lanka had welcomed 191,000 tourists up to February 25, compared to 107,639 in February 2023.

“We have been hitting back-to-back double centuries,” Gajabahu said. “January was over 200,000.”

The exhibition to be held on May 17-18, is organized by the Sri Lanka Association of Inbound Tour Operators.

It aims to establish a networking platform for small and medium sized service providers within the industry including the smallest sector.

“Homestays have been increasingly popular in areas such as Ella, Down South, Knuckles and Kandy,” SLAITO President, Nishad Wijethunga, said.

In the northern Jaffna peninsula, both domestic and international tourism was helping hotels.

A representative of the Northern Province Tourism Sector said that the Northern Province has 170 hotels, all of which have 60-70 percent occupancy.

Further, domestic airlines from Colombo to Palali and the inter-city train have been popular with local and international visitors, especially Indian tourists. (Colombo/Feb29/2024)

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Sri Lanka rupee closes at 309.50/70 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 309.50/70 to the US dollar Thursday, from 310.00/15 on Wednesday, dealers said.

Bond yields were slightly higher.

A bond maturing on 01.02.2026 closed at 10.50/70 percent down from 10.60/80 percent.

A bond maturing on 15.09.2027 closed at 11.90/12.10 percent from 11.90/12.00 percent.

A bond maturing on 01.07.2028 closed at 12.20/25 percent.

A bond maturing on 15.07.2029 closed at 12.30/45 percent up from 12.20/50 percent.

A bond maturing on 15.05.2030 closed at 12.35/50 percent up from 12.25/40 percent.

A bond maturing on 01.07.2032 closed at 12.55/13.00 percent up from 12.50/90 percent. (Colombo/Feb29/2024)

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