Sri Lanka Perspectives: January 2019
by R Hariharan on 20 Feb 2019 0 Comment

Politics of presidential election


Media is agog with speculative articles on the next presidential election after President Maithripala Sirisena completed four years in office on January 8, 2019. According to the Constitution, the President may at any time after four years from “the commencement of his first term of office by proclamation declare his intention of appealing to the people for a mandate to hold office, by election, for a further term”. The Constitution further stipulates that the poll for the Presidential election shall be held not less than one month and not more than two months before the expiration of the term of office of the President in office. This means the presidential election has to be held between November 8 and December 8, 2019.


This has triggered widespread expectation that President Sirisena would call for the presidential election to restore his political credibility, eroded after the failure of his misconceived “constitutional coup” to replace Prime Minister Ranil Wickremesinghe with former President Mahinda Rajapaksa. Though President Sirisena had initially declared that he was not interested in a second term, the changed political equation with the Prime Minister may force him to seek a second term to restore his reputation as the leader of the Sri Lanka Freedom Party (SLFP). Having burnt his bridges with Wickremesinghe and the United National Party (UNP) who supported him to come to power, Sirisena needs the support of both the Sri Lanka Podujana Peramuna (SLPP) and Rajapaksa-loyalists within the SLFP.


This was further confirmed when SLFP secretary Dayasiri Jayasekara announced that President Sirisena would be the SLFP candidate in the forthcoming presidential poll. The President’s close confidante and SLFP deputy leader Nirmal Siripala de Silva also said the same. These announcements, probably made with the consent of President Sirisena, have not been well received by the SLPP. Many SLPP members have declared that Sirisena should not be backed by the SLPP and the presidential candidate should be from the SLPP.


Probably, President Sirisena still seems hopeful of winning back the support of the right wing Buddhist lobby. He is reported to be favourably considering a recommendation from the Minister for Buddha Sasana to pardon Gnanasara Thera, leader of the Bodu Bala Sena, a Buddhist fringe group, involved in hate campaign and attacks on Muslims during Rajapaksa rule. The monk was convicted in August 2018 by the Court of Appeal on four charges of contempt of court for disturbing and threatening the state counsel in Homogama magistrate’s court subsequent to the refusal of bail to military intelligence officers suspected to be involved in a case of disappearance. The monk was sentenced to 19 years rigorous imprisonment to run concurrently and completed within 6 years. Earlier in May 2018, the monk was convicted of contempt of court and sentenced to six months rigorous imprisonment for intimidating victim-witness Mrs Sandya Ekneligoda in the case of enforced disappearance of political cartoonist Prageeth Ekneligoda. 


The controversial former defence secretary Gotabaya Rajapaksa also appears to be nursing ambitions to contest the presidential election as he is said to enjoy the support of Sinhala nationalist elements and Buddhist clergy. However, Rajapaksa does not seem to be keen to propose him as the Pohotuwa party (as SLPP is known) candidate, presumably because Mahinda Rajapaksa does not seem to have made up his mind on his own future. Moreover, Gotabaya is a US citizen and will not be eligible to contest the poll unless he renounces his American citizenship. He does not seem to have taken a decision on this issue so far.


Increasing external economic vulnerability


Sri Lanka has paid a high cost for the 51-day political crisis that brought the country’s economic activity to a grinding halt. The October 26, 2018 crisis not only exposed Sri Lanka’s limitations in servicing its huge foreign debt burden but underlined the country’s strategic dependence upon India and China, which chipped in with money to ward off the Central Bank’s imminent financial crisis. This is likely to aggravate Sri Lanka’s problems in delicately balancing its relations with the two Asian giants.


Sri Lanka Central Bank Governor Indrajit Coomaraswamy, addressing the 33rd annual session of the Sri Lanka Economic Association, explained the measures he had taken to overcome the “political tsunami” as he called the economic crisis. He said the country’s good international and regional relations, especially with India and China, enabled the country to escape serious debt crisis it faced in the wake of the political crisis. Sri Lanka will have to pay $5.9 billion in foreign debt repayments in 2019 and the first installment was $1.6 billion. Sri Lanka had repaid $1 billion by drawing on its foreign reserves; this has brought it to a “critically low level”.


He said the International Monetary Fund (IMF) had halted the release of the final tranche of the Extended Credit Facility when the political crisis occurred. However, the IMF was now supportive of the government’s stabilization measures and he expected the IMF to release the fund in mid-February when the fiscal data for 2018 would be available.


The Governor stressed the importance of the assistance of India and China in supporting the reserves. “Sri Lanka’s friends, the two regional giants, have stepped in to support us when we were pushed into a rather difficult corner”. Their combined assistance should replenish the reserves in the next few months. The Reserve Bank of India (RBI) agreed to provide a $400 million currency swap facility to the Central Bank. He said “The RBI’s very rapid and timely assistance will serve to boost investor confidence by supporting Sri Lanka to maintain an adequate level of external reserves”. The RBI was likely to provide a line of credit of US$ 1 billion early.


The Bank of China (BOC) has offered $300 million loan to tie over the immediate need. Dr Coomaraswamy said both the RBI and the BOC were considering plans to scale up their offers to $1 billion each. He stated that the Chinese loan was likely to come at an interest of about 5.5 percent. In addition, the Central bank was also trying to scale up a $1 billion loan received from China Development Bank in 2018 by a further sum of $500 million, which was expected to be available in February.


He further explained other measures taken to be prepared for “the worst and we learnt a lesson on October 26, 2018. We don’t know what political tsunami might come next. So we have to plan and get the money as fast as possible”. The proposed measures included issue of an International Sovereign Bond (ISB) to borrow up to $2 billion; the Bank of Ceylon and the Peoples Bank raising lines of credit on behalf of the government. However, these would further raise the debt burden of the country.


Col R Hariharan, a retired MI officer, served as the head of Intelligence of the Indian Peace Keeping Force in Sri Lanka from 1987 to 90. He is associated with the Chennai Centre for China Studies, South Asia Analysis Group and the International Law and Strategic Analysis Institute, Chennai. Courtesy

Courtesy: South Asia Security Trends, February 2019

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