What India should and shouldn’t do to help Sri Lanka out of economic trouble

Sri Lanka has a new Prime Minister, Ranil Wickremesinghe, in the most unenviable of circumstances. Contrary to what the Indian public believes, the work of the Sri Lankan Prime Minister is very different from that of his Indian counterpart. Until President Gotabaya Rajapaksa amends the Constitution to end the controversial executive presidency and empower the prime minister and his cabinet through parliament, the political stalemate of the past few weeks will continue, in a way or another. A constitutional debate on the reduction of the executive presidency will consume more time and energy than already, further delaying the roadmap for economic recovery.

As a friendly neighbour, India has multiple roles assigned by citizens concerned about the political stability, economic recovery and strategic security of Sri Lanka. This owes not only to India’s needs, as is often wrongly assumed in Sri Lanka, but even more so to Indian concerns that Sri Lanka does not end up with a “failed state” label, like many l had marked Pakistan in the vicinity. Nor was Sri Lanka to become a “hopeless case” as the West had dubbed Bangladesh at independence.

The Gota presidency should have the final say, such as sacrificing tax revenue by 25%, reducing the list of taxpayers by a million, banning the import of essential products without thinking and switching to “organic fertilizers” overnight, without prior consultations, preparations, education and actions.

Also read: Time is up for the Rajapaksas: Will the family fiefdom survive Sri Lanka’s economic chaos?

Plain and simple, Sri Lanka was living beyond its means. The Gota presidency should have the final say, such as sacrificing tax revenue by 25%, reducing the list of taxpayers by a million, banning the import of essential products without thinking and switching to “organic fertilizers” overnight, without prior consultations, preparations, education and actions. But the economic and currency crises of the present are a “legacy problem” for which everyone is equally responsible, since the economic reforms of 1978.

Anand model

As the new Prime Minister, Ranil Wickremesinghe should have the courage to admit that he introduced lopsided economic reforms in 1978. This led to the death of the local village dairy industry imported from New Zealand and Australia. These exporting countries should now have the grace to assist in the rediscovery of Sri Lanka’s traditional dairy industry, and also to help identify new export markets.

India, for example, has succeeded in the “Anand” model which could help recreate the Sri Lankan dairy industry. This could restore rural people’s confidence in changing times, put money in their pockets and maybe also reduce the import bill to some extent. India had also reached an agreement for the semi-annual donation of 25,000 head of cattle to the hinterland Tamils ​​of recent Indian origin, or “estate” Tamils. New Delhi can revive the project and expand the program to all parts of Sri Lanka as soon as possible.

Tea, incidentally linked to the lives and livelihoods of ‘estate Tamils’, is another export product that has been hit hard by Gota’s ‘organic fertilizer’ scheme. Without a foreign exchange reserve to import fabrics from Southeast Asia, Sri Lanka’s value-added textile exports have also been affected. Everything indicates that Indian suppliers, especially from the South, have taken advantage of this. As Sri Lanka’s new government helps restore market confidence in the country, New Delhi may also need to work with its industries, to see if the rerouted global trade hasn’t had more of a negative impact than already. on the local economy. These require discussions at the local level and adjustments at several levels.

Tourism is the third source of Sri Lankan currency and one of the most important. It is the most affected, starting with the serial Easter 2019 explosions, followed by the global COVID-19 lockdowns. The current phase of unending political instability, in the face of the forex crisis, food and fuel shortages, hitting both the hospitality industry and the transport sector, has aggravated the situation as the nation was on the road to recovery. Using the current tourism situation in Sri Lanka and the successful recovery mode of the Maldives, the Indian industry can be encouraged to build the elusive tourism hub model, to which Bhutan and Nepal can also be added in due course.

Tourism is the third source of Sri Lankan currency and one of the most important. It is the most affected, starting with the serial Easter 2019 explosions, followed by the global COVID-19 lockdowns.

In the post-war period, the government of then President Mahinda Rajapaksa invited well-known Indian agronomists as well as computer czars to rebuild the old and create a computer/computer industry, for local markets and export. Under threat from pan-Tamil elements from south India, they retreated. The government has bridged the revival of agriculture in war-torn areas of Sri Lanka. This, New Delhi can revive across this country and also consider the joint development of the IT sector.

Ensuring political stability

India’s continued humanitarian aid, aimed exclusively at helping the people, has been maliciously interpreted in Sri Lanka as New Delhi supporting the “unpopular” ruling Rajapaksas. This found an unfortunate echo in some responsible circles in India. Even the worst critics of the Rajapaksas at home have not pointed to any particular assistance from India, including credit trading, etc., that would strengthen the Rajapaksas, personally or politically, as India had done. past Chinese aid (only).

The simple truth is that aid from India is for the people of Sri Lanka and it can only work under the direction of the government. It was until now exclusively the Rajapaksas, but the new Prime Minister Ranil Wickremesinghe would have a share of the credit (in distribution) if he erases the votes of confidence in Parliament. It could be someone else if new elections, each time they are held, bring new leaders to power, whatever form of government they have at the time.

Beyond that, suggestions closer to New Delhi to play the role of facilitator to help Sri Lankans resolve the current political impasse, are based on an inadequate understanding of the history, social and political culture of this nation, of which the visible ethnic differences are only a part. . Although little is reported in the media, anti-Indian slogans were reportedly thrown at various anti-Rajapaksa protest locations, including pockets at Galle Face Green, the urban location of what was billed as the “Spring Arab” of the country.

India also paid a heavy price in the life of former Prime Minister Rajiv Gandhi, when the LTTE assassinated him (1991), for their perception of his failed role in the Sri Lankan peace process, the Indo-Sri Lankan agreement and enthronement of the IPKF. (both in 1987).

While most Sri Lankans, who cross ethnicities, languages ​​and other internal divides, are grateful for India’s saving gesture in recent weeks, there are still those benefiting from New Delhi’s largesse who continue their traditional anti-Indian posture. , without any justification. After the demonstrations, each time, it may therefore be necessary to study more closely the dynamics of these slogans, to apply political and diplomatic correctives, where necessary and possible.

In this context, and given the additional complexities of the day, nations, not excluding India, would do well not to approach Sri Lankans with their model textbooks for “problem solving” and ” conflict resolution”, activists or others. India, Norway and, to a lesser extent, Japan got their fingers burned for facilitating peace talks on the decades-old ethnic crisis, as local stakeholders ended up accusing the facilitator of taking the other party. India also paid a heavy price in the life of former Prime Minister Rajiv Gandhi, when the LTTE assassinated him (1991), for their perception of his failed role in the Sri Lankan peace process, the Indo-Sri Lankan agreement and enthronement of the IPKF. (both in 1987). More than 1,500 Indian soldiers lost their lives in a call of duty that was not theirs to begin with.

It is still the work of the Sri Lankans

This is another area where Sri Lanka must resolve its internal conflicts, which have shown unshakeable evidence of impending violence, more so than ever, especially if political drift is allowed to continue. The pro-Mahinda rioters are identifiable, but no one has taken responsibility for the retaliatory arson, which was targeted and executed with precision.

The new government will need to quickly focus on investigating these cases at the earliest, as the Catholic Church is already angered by the alleged delays and manipulation of the investigation and prosecution in the ‘Easter explosions’ case. (2019). As is acknowledged, Indian agencies had shared actionable intelligence about the impending disaster in advance, but to no avail. Instead, there were those in Sri Lanka who accused India of plotting the blasts and, yes, of promoting the subsequent Rajapaksa election victories.

The Ministry of Defense has since clarified that Mahinda is being housed in Trincomalee Naval Base as a former president entitled to security under such trying circumstances, and not necessarily otherwise.

Like any other nation, Sri Lanka has a professional army, whose leaders have repeatedly confessed their loyalty to the Sri Lankan state (which translates to whoever is the president and supreme commander), and not to a particular person. This was visible when Mahinda left office, unrecognized, almost unprotected. The Ministry of Defense has since clarified that Mahinda is being housed in Trincomalee Naval Base as a former president entitled to security under such trying circumstances, and not necessarily otherwise.

If left unresolved for a long time, the arson cases, for example, could trigger concerns and trigger possibilities for expanded activities of this type, since they are attributed to former left-wing activist JVP and to the Frontline Socialist Party (FSP). Leaving such suspicions and doubts unanswered and fully resolved can complicate the perception of security in Sri Lanka. This, in turn, may complicate matters for India, where overly leftist militancy is not yet a thing of the past, as is often claimed. Here, intelligence sharing and the like can help both nations, unrelated to rumors that India should send troops to Sri Lanka, which has enough and more – and what the Indian High Commission in Colombo has since quickly denied.

This article was first published on ORF.

N. Sathiya Moorthy is a political analyst and commentator based in Chennai. The opinions expressed in this article are those of the author and do not represent the position of this publication.

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