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Friday October 9th, 2026

Ranjagate: The perils of undermining the Rule of Law

The seizing of taped conversations that former Deputy Minister Ranjan Ramanayake had with an assortment of persons on a variety of subjects, including personal foibles, was one of the outcomes of a police raid on his home.  An unexpected outcome has been the almost immediate release of a large number of these recordings into the public realm after the police raid.  This has provided the general public with an unexpected diversion into the lives, conversations and peccadillos of those in the film industry of which the former minister is a leading member.  More controversially there is more serious stuff that has come to light associated with his being a member of the former government, which brought him in contact with politicians, judges and police, some of whom should not have been speaking to him at all on the matters they did.

The question is how these taped conversations reached the social media no sooner than the police took them into custody. According to the media, there are over 120,000 such recordings taken over a number of years, which seem to have come out the day after the police seized them.  If they leaked through the police it would be a grave security breach and breach of trust that parallels that of the former minister.  His actions have breached the trust of those with whom he spoke to while recording their conversations for some perverse or other motives of his own.  On the other hand, if there is a police hand in the leak of the tapes, it would be a breach that undermines the credibility of the legal process and erodes confidence in state institutions.

The government has acted decisively in the matter and has immediately interdicted the former head of the CID, Shani Abeysekera, and who prior to his downfall was regarded as one of the country’s most top-notch police investigators.    His interdiction is not because he leaked the tape but because he was one of those caught on tape.  There is now doubt being cast on his past work investigating crimes.  These included heinous crimes that took place and in which politicians were involved.  This is fuelling demands from politicians that those who were even sentenced to death in the past should be let off the hook on the grounds that the legal process was so hopelessly biased and the course of justice so perverted that their guilt beyond reasonable doubt no longer can be assured.

The tapes reveal Ramanayake was acting as a crusader for justice

So far the tapes that have been released regarding former Minister Ramanayake do not indicate that he was asking the judges and police personnel he was engaging in conversation to do illegal things, to make the innocent into guilty parties or make the guilty parties innocent, or to fabricate evidence to put people into trouble.  He seems to have seen himself as a crusader for justice, like in the films he acted, trying to find out what was happening in investigations, and exhorting those to whom he was speaking to do their jobs without stepping back.  This was against the code of ethics, where those entrusted by the state to investigate wrongdoing should be left to do their work independently without being influenced in any way.  The larger fault lies with those in the judiciary and police who spoke to him about things they should have kept to themselves instead of giving him information or seeking his support.

There is the old adage that justice must not only be done it must also be seen to be done.  The evidence that the former minister was engaging behind the scenes with those who have sworn to enforce the law independently and impartially will lead to further erosion in confidence about the rule of law.  It is therefore appropriate that government leaders have referred the matter to the Judicial Services Commission headed by the Chief Justice to take action.  The stories about politicians calling judges are not new.  What is new is that the engagement has been captured on tape.  This gives an opportunity to make a start at putting an end to this unacceptable practice.  The need to restore confidence in the judicial and legal processes is of paramount importance. The stakes are much higher than the individual cases that are being brought to the fore and where it is being canvased that decisions already taken should be reversed.  The reputation of the country and the protection of its leaders from the long reach of international law should also be considered.

The upholding of law and order is the single most important feature of any society as it gives people an assurance of what they can expect which gives stability to society.  Investors want a stable legal environment which is predictable and consistent.  However, the situation with regard to stability is murky as some persons are being pursued by the law such as seen recently when opposition parliamentarians are being arrested while charges are being dropped against others.  Some of these are actions that the majority of people may approve.  But this too undermines the rule of law. This includes the fulfilling of election campaign promises by the release of soldiers convicted by the courts of wartime crimes.   Following the police raid on former minister Ramanayake’s house, there is a sequence of the release of tapes, which are being used to cast aspersions against the judiciary and police.  This is leading to a loss of confidence in the rule of law.  Such a situation can undermine the prospects for development that the government has prioritised for the country.

Undermining the credibility of the judiciary and law enforcement is dangerous

There is a further reason why undermining the credibility of the judiciary and law enforcement agencies is unwise and should not be encouraged.  Apart from taking the country on a development path, another one of the government’s priorities is to extricate itself from the commitments made by the previous government to the international community with regard to dealing with the issues arising from the three-decade-long war.  In particular, the government would be looking to abrogate the commitment to set up a special judicial mechanism to probe alleged war crimes and serious violations of human rights.  But this would become difficult if government politicians themselves are publicly running down the judiciary and law enforcement agencies and accusing them of being corrupt and biased. International human rights law comes to bear on countries that are suffering from the breakdown of their domestic legal systems.

UNHRC Resolution 30/1 of 2015 which was co-sponsored by the former government referred to the commitment “to establish a judicial mechanism with a special counsel to investigate allegations of violations and abuses of human rights and violations of international humanitarian law, as applicable; affirms that a credible justice process should include independent judicial and prosecutorial institutions led by individuals known for their integrity and impartiality; and also affirms in this regard the importance of participation in a Sri Lankan judicial mechanism, including the special counsel’s office, of Commonwealth and other foreign judges, defence lawyers and authorized prosecutors and investigators.”

The basic principle of international law in relation to domestic law is that it comes into operation if the domestic legal system is seen to have broken down and the people of that country, and internationally, have lost confidence in it.   Hybrid courts of the sort that the UNHRC resolution can drive towards have been set up in countries where the domestic legal system had collapsed or was seen by the international community to have collapsed, such as Cambodia, Sierra Leone and Rwanda.  Unfortunately, the present movement in Sri Lanka can take the appearance of being in the direction of a breakdown.  The fact that the Inspector General of Police Pujith Jayasundera and former Defense Secretary Hemasiri Fernando are languishing in prison for over three months itself shows that the system of law and order is in crisis. Now the Ramanayake tapes are being used to campaign for a reversal of legal decisions taken in the past.  None of this will be helpful for Sri Lanka to extricate itself from its peril.

Foreign investors buy Sri Lanka rupee bonds after selling for two weeks

ECONOMYNEXT – Foreign investors bought Sri Lanka rupee bonds for the first time in three weeks in the week ended on October 01, Central Bank data showed, amid a stable rupee.

With the latest inflows, the island nation has witnessed net foreign buying in 14 weeks in the last 16.

Offshore investors bought a net 1,821 million rupees (US$5.5 million) worth of Sri Lanka rupee bonds. They sold a net Rs.16.5 billion worth of rupee bonds in the last two weeks.

The inflows helped boost foreign holdings in government securities to 196.8 billion rupees.

Analysts said a stable local currency helped foreign buying last week.

The rupee had been steady for more than three years before the sharp depreciation in May with the Central Bank citing higher oil and vehicle imports amid a lingering conflict in the Middle East.

The rupee has fallen 6.2 percent through October 2 this year.

Globally, investors are cautious about economic growth due to the impact of the latest Middle East escalation.

The island nation has enjoyed a total inflow of around 57.5 billion rupees into rupee bonds so far this year, following a net inflow of 71.5 billion rupees last year.

The island nation has seen an uptick in inflation in the last six months following a nearly 50 percent hike in fuel prices.

The government raised fuel prices last week after reducing in the last weeks of June and August.

The Central Bank raised its key monetary policy rate by 100 basis points in May to curb inflationary pressure stemming from higher demand.

Before the May rate hike, the Central Bank kept its key policy rates steady since May 2025 after reducing them by 825 basis points over 24 months since June 2023 and foreign investors have been buying rupee bonds despite slight depreciation in the local currency (Colombo/October 08/2026)

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Sri Lanka rupee closes at 330.95/331.00 to US dollar spot, bond yields steady

ECONOMYNEXT – Sri Lanka’s rupee closed at 330.95/331.00 to the US dollar in the spot market on Thursday, from 330.90/331.00 the previous day, while bond yields closed broadly steady, dealers said.

A bond maturing on 01.08.2030 closed flat at 11.25/35 percent.

A bond maturing on 15.10.2030 closed at 11.30/40 percent, down from 11.35/40 percent.

A bond maturing on 01.02.2031 closed at 11.35/45 percent, down from 11.40/45 percent.

A bond maturing on 15.12.2032 closed at 11.75/80 percent, up from 11.70/80 percent.

A bond maturing on 15.10.2034 closed at 12.05/15 percent, up from 12.05/10 percent. (Colombo/Oct8/2026)

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Sri Lanka, IMF in talks over new “long term growth targeted” deal after March 2027: Minister

ECONOMYNEXT – Sri Lanka is in discussion with the International Monetary Fund (IMF) on a new programme after the completion of the current Extended Fund Facility (EFF), Deputy Finance Minister Anil Jayantha told Parliament on Thursday.

“The current IMF EFF program is on track to conclude successfully in March 2027, marking the completion of its economic reform and recovery efforts under the arrangements,” the Deputy Minister said in response to a question raised by the opposition.

“In parallel, discussions are currently underway regarding the options beyond the current program, reflecting a shift from crisis-driven support towards a more sustainable, long-term growth-targeted engagement model.”

Sri Lanka sought IMF deal after the island nation experienced an unprecedented economic collapse that culminated in its first-ever sovereign default in April 2022.

Severely depleted foreign exchange reserves, exacerbated by years of loose fiscal policies, high-profile tax cuts, organic farming mandates that damaged agricultural yields, and the economic blow dealt by the COVID-19 pandemic, left the island nation unable to service its $51 billion external debt stock.

The resulting crisis triggered severe shortages of fuel, medicines, and staple foods, hyperinflation exceeding 70%, and widespread public protests that ultimately forced the resignations of key government figures, including former President Gotabaya Rajapaksa.

The four-year, $3 billion EFF program was conditioned on a rigorous slate of macroeconomic and structural reforms, including tax hikes, energy cost-reflective pricing, expenditure controls, and strict central bank independence.

Central to the arrangement was a complex sovereign debt restructuring process, requiring the island nation to negotiate bilateral debt relief with major sovereign creditors, such as China, India, and Paris Club members, alongside commercial international sovereign bondholders.

The implementation of the EFF has since driven a significant macroeconomic turnaround, marked by a stabilizing exchange rate, a rebuild of gross official foreign exchange reserves, and a return to positive GDP growth.

However, maintaining compliance with program targets has generated considerable social and political friction.

Demands for broader anti-corruption measures, tax fairness, and enhanced social safety nets remain high as the government balances strict IMF revenue targets against domestic pressures to alleviate the elevated cost of living. (Colombo/October 08/2026)

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Sri Lanka stocks close down 1.38-pct; LMF crossing pushes turnover

ECONOMYNEXT – Sri Lanka’s Colombo Stock Exchange closed lower on Thursday, CSE data showed, with the benchmark All Share Price Index falling 1.38 percent.

The ASPI was down 283.21 points at 20,234.34, while the more liquid S&P SL20 was down 0.82 percent, or 47.82 points, at 5,768.58.

Positive contributors to the ASPI were HNB Life (up 3.04 percent at 144.25 rupees), Renuka Holdings (up 2.16 percent at 37.90 rupees), Odel (up 2.06 percent at 9.90 rupees), and Hayleys (up 0.22 percent at 223.00 rupees).

Carson Cumberbatch (down 3.39 percent at 676.25 rupees), Distilleries Company of Sri Lanka (down 2.85 percent at 51.10 rupees), Hemas Holdings (down 2.56 percent at 30.50 rupees), Dialog Axiata (down 1.34 percent at 44.10 rupees), and Hatton National Bank (down 0.99 percent at 375.50 rupees) were top negative contributors.

Market turnover was 2.74 billion rupees.

High turnover was largely driven by crossing transactions, with Lanka Milk Foods recording crossings of about 1 billion rupees and Sunshine Holdings seeing a crossing of around 300 million rupees. (Colombo/Oct08/2026)

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Sri Lanka’s SEC urges public not to deposit, invest in Quantum AI Limited  

ECONOMYNEXT – Sri Lanka’s Securities and Exchange Commission (SEC) has warned the public in dealing with a company called Quantum AI Limited for trading and investment and urged them not to deposit any funds.

The regulator, on its X platform, stated it “wishes to inform the public that Quantum AI Limited is not licensed, registered, or authorized by the SEC to conduct securities trading, investment services, or any other regulated capital market activities in Sri Lanka.”

“The public is strongly advised not to deposit funds, invest, or engage in any trading or investment activities through Quantum AI Limited.”

“Before investing, always verify that the entity is duly licensed or registered by the SEC. Protect your investments. Deal only with SEC authorized market intermediaries.” 

Officials from Quantum AI Limited were not immediately available for comment on the SEC’s statement. 

Sri Lanka has increasingly seen illegal firms taking deposits and investments while promising higher returns.

Last week, the Central Bank warned the public against investing in plantation companies that are not regulated by it. (Colombo/October 08/2026) 

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Sri Lanka’s 2027 appropriation bill sets 20% rise in recurrent spending from last year, less capex

ECONOMYNEXT – Sri Lanka’s 2027 appropriation bill tabled in Parliament with details of allocations for each ministry, has increased recurrent expenditure by a fifth and cut capital expenditure by 5.4 percent compared to the last year.

The bill sets out 3,240.2 billion rupees as current spending, more than a fifth higher than allocated for last year.

It also shows the capital expenditure has been set at 1,752.5 billion, 5.4 percent less than allocated for last year.

The capex also does not conform to the capex in the formal budget presentation.

It also sets a borrowing limit of 3,800 billion rupees.

The borrowing includes roll-overs and does not correspond to the new financing (deficit) shown in the budget presentation.

The presentation of the Appropriation Bill on Wednesday (07) is considered the first reading of the budget.

In his capacity as the Minister of Finance, President Anura Kumara Dissanayake will present the second reading of the Appropriation Bill (the Budget Speech) on November 12. Seven days have been allocated, from November 13 to 20, for the second reading debate.

According to the Appropriation Bill, the largest allocation has been made to the Ministry of Finance, Planning and Economic Development, amounting to Rs.856.8 billion.

Provincial Councils are allocated Rs. 659.9 billion; the Ministry of Public Administration, Provincial Councils and Local Government has been allocated Rs. 651 billion, Ministry of Health and Media Rs. 590.5 billion, Ministry of Transport, Highways and Urban Development Rs. 500 billion, Ministry of Defence Rs. 458 billion, and Ministry of Education, Higher Education and Vocational Education Rs. 328 billion.  (Colombo/October 08/2026)

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