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Sunday June 16th, 2024

Pakistan statement on Sirisena meeting “breach of diplomatic protocol”

A “breach of diplomatic protocol” is how senior officials are describing an exchange of statements between the Pakistani High Commission in Sri Lanka and the Presidential Secretariat about a meeting that took place between Islamabad’s envoy in Colombo and the President last Tuesday, 20 Aug, that has left officials with red faces on both sides.

Both the Sri Lankan side and the Pakistani High Commission today refused to comment on the apparently contradictory statements issued by Colombo and Islamabad on the meeting between President Maithripala Sirisena and Pakistani High Commissioner Maj. Gen. (R) Dr. Shahid Ahmad Hashmat.

After the meeting, the Pakistani High Commission issued a statement saying that Gen. Hashmat described the situation arising in Jammu and Kashmir to the President. “He also apprised the President of the deteriorating human rights and humanitarian situation in the Indian occupied Jammu and Kashmir, which has been under total lockdown and curfew since 5 August 2019,” it added.

It went on to say that the President “acknowledged that Jammu and Kashmir is a disputed territory and expressed his desire that this dispute should be resolved according to wishes of Kashmiris under UN Resolutions. He also offered Sri Lanka’s mediation and facilitation of dialogue between Pakistan and India to re-activate the SAARC forum.”

This is contrary to Sri Lanka’s usually studied and careful neutrality on major issues that plague the Indo-Pak relationship, particularly the Kashmir issue which is at the core of the long-standing disagreement between the neighbours.  

Last night the President issued a statement saying that his attention has been drawn to the Pakistani statement and acknowledged that the envoy had briefed him about the issues arising from the abolition of section 370 of the Indian Constitution regarding the special status of Kashmir and recent developments.

However, the statement made no mention of the President acknowledging Pakistan’s stand instead said: “Sri Lanka has the greatest friendship with both these countries and our desire is achieving regional peace and stability.”

Senior Sri Lankan officials said that the Pakistanis “should have consulted us before releasing their statement, it is clearly a breach of diplomatic protocol.”  

After the abrogation of Kashmir’s special status, Sri Lanka was one of the first SAARC countries to refer to the situation as an internal matter for India.

Sri Lanka, Bangladesh, Maldives and Bhutan have taken similar stands on the recent developments in Kashmir, while Nepal and Afghanistan are calling it an Indo-Pak bilateral issue.

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Sri Lanka car import relaxing roadmap given to IMF: State Minister

ECONOMYNEXT – Sri Lanka has submitted a roadmap on relaxing vehicle imports to the International Monetary Fund, State Minister of Finance Ranjith Siymabalapitiya said as the country recovers from the worst currency crises in the history of its central bank.

The import relaxation will allow vehicles for public transport, goods transport, then motor cycles and cars use by private individuals and after that, luxury cars, Minister Siyambalapitiya said.

Luxury cars however attract the highest taxes for each dollar spent on imports.

Economic analysts have characterized vehicle import controls as a ‘cascading policy error’ that follows inflationary rate cuts, which then deprive taxes to the state and triggers more money printing and more forex shortages, requiring even higher corrective interest rates and a contraction of economic activities to save the rupee.

According to the latest IMF report car import controls may have led to revenue losses of 0.7 to 0.9 percent of GDP.

Sri Lanka started controlling imports few years after a central bank was set up in 1950 and also tightened exchange controls progressively, so that macroeconomists using post-1920 spurious monetary doctrines taught at Anglophone universities could print money through various mechanisms to suppress rates.

Sri Lanka is working with the IMF as a guide on many issues and the roadmap was submitted to the agency on June 14, Minister Siyambalapitiya said.

The IMF in an economic report released last week the plan was expected to be submitted by June 15.

Whatever the IMF’s faults, which some wags have called ‘progressive Saltwaterism’, the agency does not advocate import controls as solution to balance of payments problems, despite a Mercantilist fixation with the current account deficit in countries with reserve collecting central banks, analysts say.

Import controls have the same effect as import substation on the balance of payments, which is none, classical economists have pointed out and is now mainly a problem associated with macro economists and economic bureaucrats of so-called basket case countries.

Any pressure on the currency or missed reserves targets in the IMF program has come in the past only if the central bank printed money to suppress rates as credit growth picked up from car imports.

Sri Lanka had 3,000 items under import controls when rates were suppressed with printed money from 2020 to 2022 but eventually ended up with the worst currency crisis triggered by macro economists in the history of the country and eventual external default.

A committee made up of the Department of Trade and Fiscal Policy of the Finance Ministry, the Department of Registration of Motor Vehicles, the Central Bank and two associations representing vehicle imports were appointed to come up with the roadmap, he said. (Colombo/June15/2024)

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Chitrasiri Committee presents draft constitution for Sri Lanka Cricket

ECONOMYNEXT – A draft constitution for Sri Lanka Cricket, the governing body for cricket in the island, prepared by a committee headed by retired Supreme Court judge K T Chitrasiri, was presented to President Ranil Wickremesinghe today (15).

The Sri Lanka team were ignominiously knocked out of the Men’s T20 World Cup tournament this week, sparking renewed criticism of the team and the governing body.

Last November, a cabinet sub-committee was appointed to address challenges faced by Sri Lanka Cricket and provide recommendations after consecutive losses became a hot topic in parliament.

After parliament decided to remove the administrators of the sport, the International Cricket Council (ICC) Board suspended Sri Lanka Cricket’s membership.

Based on the sub-committee’s recommendations in its report, the Cabinet then appointed an expert committee to draft a new constitution for Sri Lanka Cricket.

The committee headed by judge K T Chitrasiri includes President’s Counsel Harsha Amarasekara, Attorney-at-Law Dr Aritha Wickramanayake and Chairman of the Sri Lanka Chamber of Commerce Duminda Hulangamuwa.

Deputy Solicitor General Manohara Jayasinghe, and Shamila Krishanthi, Assistant Draftsman representing the Legal Draftsman’s Department, and Loshini Peiris, Additional Secretary to the President were also on the committee. (Colombo/Jun14/2024)

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Sri Lanka’s Cable Solutions in Rs605mn IPO

ECONOMYNEXT – Sri Lanka’s Cable Solutions Limited will make an initial public offering of ordinary voting shares on the Diri Savi Board of the Colombo Stock Exchange (CSE).

The CSE had approved, in-principle, an application submitted by the company, for the listing of its ordinary voting shares by way of an offer for subscription and an offer for sale.

For subscription, 14,666,600 shares would be offered at 7.50 rupees a share.

For sale, 66,120,000 shares would be offered at 7.50 rupees a share.

The opening of subscription list is July 23. Copies of the prospectus would be made available to trading participants on July 9. (Colombo/Jun15/2024)

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Sri Lanka’s ACL Cables wraps up acquisition of Cable Solutions

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