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Tuesday October 20th, 2026

Time to build upon the COVID dividend in South Asia education

NETWORK TREES: Students in remote areas travel to ‘network trees’ instead of school for online classes. High taxes makes it difficult for companies to rollout network to rural areas with low population density.

ECONOMYNEXT – The coronavirus pandemic has challenged every vestige of life we take for granted, and in the field of education, it has forced society to take a good, hard look at its methods of delivery, affordability and equal accessibility.

Even as technological advancements were gradually introduced in schools, it had mostly been limited to better serviced cities, and to students of the financially better off schools. Certainly, using internet based learning for school goers was hardly on the cards.

The pandemic forced governments in South Asia to rely heavily on technology to deliver lessons to students, though the manner in which it was imparted has been less than satisfactory as a large number of children, especially from low- and middle-income families, and those living in underserved locations have been short-changed.

Now, even as educationists seriously look at hybrid-learning for the future, there is a rich discussion on what that should be.

As well, text book dependency may well be a thing of the past, where information can be accessed via the internet. In this context, Parit Wacharasindhu, CEO of Startdee, Thailand questions why students need to attend school at all.

Speaking at a webinar on “Hybrid Learning; The Future of Education” Wacharasindhu’s provocative question is indeed appropriate in these times. As he explains, it is not about doing away with schools, but that it is time society looks at the role a school plays, critically.

It is his contention that schools be transformed into places where students find out about themselves, their likes and dislikes and what they want to do with their lives.

Schools must become institutions that provide children job ready skills. They must be taught to be innovate, and not be in jobs, where technology could easily replace.

Wacharasindhu sees schools as the place where students will develop a social consciousness, be the
voices against corruption, not just commit to memory what text books say on corruption and regurgitate that to pass an exam, but be trained to be active citizens.

The webinar, organised by the Friedrich Nauman Foundation for Freedom(FNF) was held on September 17, as part of its Restart Education in South Asia, series.

Moderated by the CEO of the City Montessori Schools in India, Roshan Gandhi, the panel included Ms. Baela Raza Jamil, CEO ofIdara-e-Taleem-o-Aagah, Pakistan and Dr. Parth J Shah, Founder President, Centre for Civil Society, India.

The pandemic has thrown up some positives in terms of education, says Jamil, who described how many teachers in Pakistan, have, sometimes of their own accord and through private sector involvement upgraded their technological skills to better serve their students.

Governments must recognise such teachers she says, even as there must be more attention paid to those who struggle to master technological advancements.

Another plus, say both Jamil and Shah is the level of parental involvement in the education of their children. With long periods of lockdowns, and learning taking place largely at home, even the dads got involved says Shah.

It’s a paradigm shift, he says, to see even the extended family getting involved in the education of their children.

Despite all that, the panelists’ state more needs to be done, and governments especially must invest more in ensuring a level playing field for all school going children.

A survey carried out in March, Jamil states, revealed the inequalities of the system. While the financially better off students have full access to internet based education, the survey showed that was not the case in 16 rural districts.

Even if students have access to the internet, it’s about whether they are using their smart phones or laptops.

That is determined by household incomes and now, it is a digital divide between students.

Jamil says that though nearly 40per cent of the population live below the poverty line, there has been quite an increase in the hybrid learning curve, and some form of investment by parents to support this form of learning.

In both India and Pakistan, the most affected are children studying in budget private schools, which cater to the low and mid income levels groups.

These are parents who prefer not to enrol their children in State run schools, but, in a bid to provide their offspring a head start in life, admit them to more affordable private schools.

In some instances, parents have opted to remove children from school, hoping to re-enroll them when the situation improves.

Thailand is dogged by teacher shortages, with one teacher often having to teach several grades. Would hybrid learning then, open the way for teachers of general subjects to teach across several schools?

Having a structured 9 a.m. to 3 p.m. classroom setting may not be the way to go says

Wacharasindhu,pointing out that the method would require a lot of data usage. Governments should consider, through public private partnerships to subsidise the internet for this purpose he suggests.

However governments charge high taxes from mobile telephony and telecom companies pay astronomical fees to South Asian governments which push up the up front cost of infrastructure, as well as operating costs, analysts say.

In a March 2021 spectrum auction Indian telecom operators paid 778.4 billion rupees for 856 MHz frequencies, amid warnings that Indian mobile charges are likely to go up.

RELATED LINK: Why your mobile bills could go up by 25-pct in 2021

Hybrid learning opens up the possibility to do away with outmoded teaching methods and
beliefs, Wacharasindhu adds, saying that one option is to introduce educational videos which students could watch prior to ‘attending’class.

That would allow teachers to introduce more action based education in keeping with modern trends.

There is also the issue of ethics and trust where teachers would have to be satisfied that students have not uploaded answers obtained from other tech savvy tutors.

Edtech companies, Wacharasindhu points out will have to be more socially responsible in ensuring better learning outcomes and in providing access to technology. Jamil agrees, ‘teaching must go beyond text books, and the voices of students, parents and teachers must be accommodated.’

Shah who explains that teachers have undergone a revolution of sorts owing to the pandemic, and adapting themselves to new teaching methods, adds that they will also need to be more innovative in ‘disciplining’ students.

It should be more about motivating students, he opines.

Just as webinars have replaced physical meetings in other sectors, teachers too now have the opportunity of consulting with colleagues not just across the country, but globally to keep abreast of trends, Shah points out.

Edtech companies must, says Jamil be sensitive to income needs of families and design models accessible to everyone. This pandemic has shown, that even in rural households there has been some investment in technology to help children with their studies.

In turn, schools too must take into account the realities of their student populations she adds, while Shah explains that the ‘one size fits all’ is not the way to design hybrid education.

Though countries such as Pakistan had introduced a dedicated TV channel for students, and a distance learning web, Jamil would like to see better financial commitment from governments. The government is working with Edtechs and talks of innovation funds, yet, she says there is not real financial commitment to support these plans.

Despite the disastrous setbacks brought upon by the pandemic, in the educational sector, it has opened up the space for change. Panelists agree that the ‘COVID Dividend’ must be exploited, to change mindsets, to close the gap between public and private schools, especially the less financially viable ones so students of all income levels have the same access to education.

As Jamil explains, it is time for governments to adopt a rolling policy on education which will be open to growth and changes and include all the voices of all stakeholders.

Sri Lanka’s Sampath Bank, David Pieris Automobiles launch vehicle financing partnership

ECONOMYNEXT – Sri Lanka’s Sampath Bank and David Pieris Automobiles are partnering to offer customers preferential vehicle financing and ownership benefits.

Under the collaboration, customers purchasing vehicles through David Pieris Automobiles will receive a 0.5 percentage point reduction on published vehicle lease interest rates, subject to terms and conditions.

They will also have access to vehicle insurance premium loans with no interest if settled within two months, along with Sampath Bank credit cards that carry no joining fee and offer 0% interest instalment plans for insurance payments for up to 12 months.

David Pieris Automobiles, the four-wheeler sales arm of the David Pieris Group and distributor of GWM brands including HAVAL, TANK and ORA, as well as BAIC models, will provide additional customer benefits including free vehicle registration and a third labour-free vehicle service.

The two companies said the partnership reflects a shared commitment to meeting evolving mobility needs through accessible financing and automotive solutions. (Colombo/Oct20/2026)

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Sri Lanka’s Access Engineering drops S Asia logistics hub project, expects Rs1.45bn recovery

ECONOMYNEXT — Sri Lanka’s Access Engineering PLC said shareholders have agreed not to proceed with the South Asia Commercial and Logistics Hub project, following an initial corporate disclosure made in April 2023.

The parties have agreed to enter into a settlement agreement for the orderly termination of the project and all related agreements.

Under the planned settlement arrangements, Access Engineering anticipates recovering approximately 1.453 billion rupees from its total investment of roughly 1.762 billion rupees.

“The decision was made in view of changes in external circumstances, including adjustments to the project’s implementation environment and timetable, together with the respective commercial considerations of the parties,” Managing Director Rohana Fernando said in a filing to the Colombo Stock Exchange.

Access Engineering holds a 15 percent shareholding in South Asia Commercial and Logistics Hub Limited.

Under the settlement terms, the company expects to receive 3.286 million US dollars (equivalent to approximately 1.087 billion rupees) as its proportionate share of the settlement refund.

It will also receive approximately 365 million rupees representing its share of available distributable funds, based on an indicative exchange rate of 331 rupees per US dollar.

In its audited consolidated financial statements for the year ended March 31, 2026, the group had already recognized its share of losses amounting to approximately 387 million rupees, leaving the carrying value of the investment at roughly 1.38 billion rupees.

“Based on the anticipated settlement proceeds and the carrying value of the investment, no further material financial loss is presently anticipated in the Group’s consolidated financial statements,” Fernando said.

However, because the investment is carried at cost in the company’s separate financial statements, Access Engineering expects to recognize a company-level loss of approximately 310 million rupees.

The company noted that the final figures remain subject to the exchange rates applicable on actual transaction or payment dates, final settlement arrangements, and applicable accounting adjustments. (Colombo/Oct20/2026)

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Sri Lanka rupee weaker at 331.75/90 to US dollar spot, bond yields higher

ECONOMYNEXT – Sri Lanka’s rupee was quoted at 331.75/90 to the US dollar in the spot market on Tuesday, weaker from 331.60/70 the previous day, while bond yields were quoted higher, dealers said.

A bond maturing on 15.09.2029 was quoted at 11.10/30 percent, up from 11.10/25 percent.

A bond maturing on 01.08.2030 was quoted at 11.65/70 percent, up from 11.50/60 percent.

A bond maturing on 01.12.2031 was quoted at 11.90/12.00 percent.

A bond maturing on 15.01.2033 was quoted at 12.25/35 percent, up from 12.25/30 percent.

A bond maturing on 15.06.2034 was quoted at 12.50/55 percent, up from 12.40/50 percent.

The telegraphic transfer rate for the dollar was 327.10 buying, 336.10 selling; the euro was 364.3987 buying, 378.1795 selling; pound was 434.5676 buying, 448.6760 selling.

On the Colombo Stock Exchange the All Share Price Index was down 0.09 percent, or 18.32 points, at 20,041; while the S&P SL20 was broadly unchanged at 5,701. (Colombo/Oct20/2026)

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Global financial markets face rising risks from AI, bond yields, and cyberattacks: IMF

Financial markets have remained resilient amid solid economic growth and strong corporate earnings, while financial conditions have been relatively accommodative. However, there is no room for complacency.

Three key risks have been increasing, each with the potential for broader implications: an artificial intelligence-driven market correction, a sharper rise in sovereign bond yields, and cyberattacks.

Vulnerabilities beneath the surface could determine how damaging the manifestation of these risks would be, as we detail in the latest Global Financial Stability Report. An AI market correction could trigger broad deleveraging across asset classes. A bond yield shock could reprice assets and reduce the collateral value of bonds in financial transactions. A cyberattack could disrupt critical operations and weaken confidence. High borrowing, scarce liquidity, and tighter links across markets could amplify the impact into broader financial stress.

Heavy reliance on AI

AI has become an important support for the global economy and financial markets, as discussed in the World Economic Outlook. Investment in data centers, semiconductors, and related infrastructure has spurred economic activity, while companies driving the AI boom have delivered exceptional earnings growth. But faltering AI investment and profitability could challenge optimistic expectations and trigger a correction in asset prices linked to the AI industry.

Growing leverage could be a catalyst for such a correction. Hyperscalers, as the largest data center operators are known, are borrowing more and more, while investors have been leveraging to invest in AI stocks. Circular financing arrangements in the AI sector, involving equity and debt flows between AI firms, suggest that stress at key companies receiving investment could lower revenue forecasts and investment valuations, which in turn would weaken the value of the accumulated debt in those deals. Our review of 14 such transactions since 2023 found about $300 billion in equity investments and $650 billion in debt, in exchange for $1.4 trillion in future revenue commitments.

Government debt risks

Sovereign bond yields have risen amid renewed inflation pressures from higher energy prices, fiscal concerns, and, in some cases, stronger-than-expected economic growth. It may be the case that bond yields are moving back toward the levels seen before the global financial crisis, when growth and inflation were higher than in the 2010s. At the same time, risks of adverse feedback loops related to higher fiscal imbalances and leveraged trades in bond markets are increasing. In addition, as central banks have been reducing their balance sheets, greater reliance on price-sensitive investors could contribute to further yield volatility.

As government bonds underpin the global financial system, the consequences of higher sovereign yields could extend well beyond public debt. Higher yields could further raise discount rates and depress valuations across other assets, including those that are AI-related, while reducing the value of bonds used as collateral.

Cyberattacks

As finance becomes more digital and interconnected, cyber disruptions have emerged as a growing source of systemic risk. A major incident could disrupt payments, trading, access to deposits, or other critical financial services. The danger is particularly acute if an attack affects a major financial institution, payment system, cloud provider, or software platform, allowing disruption to spread through an increasingly interconnected financial system.

Importantly, cyber threats can be hard to contain. In more than 70 percent of reported cases so far this year, software providers had almost no time to patch vulnerabilities before attackers exploited them. That’s more than double the share in 2021, when providers typically had close to 300 days to fix vulnerabilities. Frontier AI models could accelerate both attacks and defenses, increasing the importance of cyber resilience, incident reporting, crisis preparedness, and oversight of critical third-party providers.

Financial fault lines

Underlying vulnerabilities could amplify the impact of these three risks into systemic events.

Although global banks, the core of the financial system, remain resilient overall under our adverse stress scenario, there could be weak links. Banks with 22 percent of global banking assets would emerge with post-stress capital ratios below regulatory limits, an increase from 18 percent a year ago. Moreover, the links of such banks with nonbank financial intermediaries are deepening, creating additional channels for transmitting stress.

Beyond banking, pension funds and insurers have steadily increased allocations to illiquid assets and derivatives, while relying more heavily on the same asset managers. This increases the risk that at a time of stress, they could face sudden liquidity needs through margin calls and could react in similar ways—for example by selling the same assets—amplifying market moves. Some of these institutions also hold illiquid private credit, another potential amplification channel.

At the same time, as borrowers have become more leveraged, some direct-lending funds have committed to provide funding on demand. If financial conditions tighten, borrowers could draw on those facilities just as the funds that provide them could be facing their own liquidity pressures. Such dynamics could further reduce credit to companies that need it most, with consequences for the broader economy.

In emerging and developing economies, bond yields have also risen, although their spreads compared with their advanced economy peers remain fairly compressed. However, recent global shocks have diminished buffers, thereby increasing external vulnerabilities and reducing their ability to absorb stress.

Policies to safeguard

With government debt high, inflation pressures re-emerging, and higher borrowing costs, policymakers have much less room to support the economy following shocks than in the past.

We see three priorities for action:

-Debt needs to be put on a sustainable path.
– Leverage and liquidity mismatches in AI, private credit, and other nonbank financial sectors should be limited, including through sectoral capital and concentration requirements on banks’ exposures to these sectors.
– Cyber defense capabilities need to be strengthened, for example through better incident reporting and resilience testing among financial institutions.
Emerging and developing economies should also rebuild buffers while financial conditions remain accommodative. Proactive policies are the best way to prepare as risks are rising.

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Sri Lanka rupee closes weaker at 331.60/70 to US dollar spot, bond yields higher

ECONOMYNEXT – Sri Lanka’s rupee closed at 331.60/770 to the US dollar in the spot market on Monday, weaker from 331.25/35 the previous day, while bond yields closed higher, dealers said.

A bond maturing on 15.09.2029 closed at 11.10/25 percent, up from 11.05/15 percent.

A bond maturing on 01.08.2030 closed at 11.50/60 percent, up from 11.40/50 percent.

A bond maturing on 15.10.2030 closed at 11.65/75 percent, up from 11.50/55 percent.

A bond maturing on 01.02.2031 closed at 11.75/80 percent, up from 11.55/65 percent.

A bond maturing on 15.12.2032 closed at 11.90/12.10 percent, up from 11.80/90 percent.

A bond maturing on 15.01.2033 closed at 12.25/30 percent, up from 11.95/12.05 percent.

A bond maturing on 15.06.2034 closed at 12.40/50 percent, up from 12.20/25 percent. (Colombo/Oct19/2026)

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Sri Lanka shares close down on Monday; ASPI falls 0.62-pct

ECONOMYNEXT – Sri Lanka’s Colombo Stock Exchange closed down on Monday, CSE data showed, with the benchmark All Share Price Index falling 0.62 percent.

The ASPI was down 125.63 points at 20,059.42, while the more liquid S&P SL20 was down 0.51 percent, or 29.36 points, at 5,709.47.

Raynal Wickremeratne, Head of Research and Strategy at NDB Securities, noted that market turnover remained low, with local sentiment reflecting the recent volatility and declines across regional Asian markets.

Positive contributors to the ASPI were Watawala Plantations (up 2.43 percent at 46.40 rupees), Richard Pieris and Company (up 1.54 percent at 26.40 rupees), Ceylon Cold Stores (up 0.62 percent at 122.00 rupees), and Commercial Bank of Ceylon (up 0.13 percent at 198.25 rupees).

Dialog Axiata (down 2.27 percent at 43.00 rupees), Overseas Realty (Ceylon) (down 2.00 percent at 49.00 rupees), John Keells Holdings (down 1.67 percent at 17.70 rupees), Hemas Holdings (down 1.29 percent at 30.50 rupees), and Hatton National Bank (down 0.79 percent at 375.00 rupees) were top negative contributors.

Market turnover was 680.32 million rupees. The banking sector led turnover with 188.71 million rupees, followed by capital goods with 177.78 million rupees.

Crossings were recorded in Seylan Bank for 98 million rupees and John Keells Holdings for 26 million rupees. (Colombo/Oct19/2026)

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