Sri Lanka devalues currency, ups defence budget

Courtesy: Daily Mirror

By Amal Jayasinghe | AFP
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Sri Lanka announced Monday a surprise three percent depreciation of the rupee against a basket of currencies in a move to boost exports, as it released a 2012 budget that boosts defence spending.

Sri Lanka's central bank has said the rupee has been steadily appreciating against other currencies since the end of the island's decades-long Tamil separatist war in May 2009.

Economic woes in Europe and the United States have also led to a downturn in demand for Sri Lanka's exports, government officials said.

"I have asked the Central Bank (of Sri Lanka) to depreciate the rupee by three percent with immediate effect," President Mahinda Rajapakse told parliament as he unveiled the budget.

"This is to remain competitive with our neighbours," he said.

Official sources said it was the first time in more than a decade that the government has carried out a "single stroke" depreciation of the rupee.

Sri Lanka's central bank has maintained a "managed float" with the local unit tied to a basket of foreign currencies.

The central bank said the rupee had appreciated 7.4 percent last year against the basket of currencies including the dollar, the pound and the euro.

"Our exporters find it difficult to remain competitive," Rajapakse said.

Neighbouring India's rupee has fallen by nearly 15 percent this year against the dollar as investor concerns about the eurozone debt crisis and a slowing domestic economy have pumped demand for the US currency.

The president added he was also keen to reduce imports of goods that could be easily manufactured on the island, saying he was offering tax breaks to small industries to make medical supplies and food supplements to save millions of dollars spent on imports.

The budget included an increase in defence spending, despite the end of the ethnic conflict, with some 230 billion rupees ($2.1 billion) to be spent on defence in 2012, up from 215 billion rupees this year.

Security authorities say they need to keep defence spending high to repay loans on military hardware purchased to fight the Tamil Tigers during nearly four decades of ethnic conflict which claimed up to 100,000 lives.

Rajapakse also announced a new move to re-take some 37,000 hectares (91,428 acres) of plantations leased to private companies, saying that the land had not been properly utilised.

The takeover announcement came hot on the heels of criticism over another move earlier this month to nationalise 37 private companies which had either leased or bought state land in the past 20 years.

As part of new revenue-raising measures, Rajapakse hiked taxes on luxury vehicles while cigarette and alcohol prices were increased just before the budget. He also announced a 10 percent salary increase for public servants.

The country's total spending in 2012 is estimated at 2.22 trillion rupees while total revenue is estimated at 1.12 trillion rupees, figures showed.

© AFP

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Sri Lanka mulls police 'cash for big families' plan

By Charles Haviland | BBC News
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The government of Sri Lanka appears to want military and police families to have more children.

Presenting the annual budget speech on Monday, President Mahinda Rajapaksa announced that any police officer parenting a third child would be given a one-off cash grant of one hundred thousand Sri Lankan rupees.

The same grant was offered to army, navy and air force parents a year ago.

Delivering the budget in his capacity as finance minister, President Rajapaksa said that giving police families a sum equivalent to 900 dollars for parenting a third child was the mark of a "caring society."

He said the police and the rest of the security forces had fostered democracy, development and social reconciliation in Sri Lanka, and deserved this grant for having another child.

'Continued militarisation'

Nearly all members of the police and military currently come from the Sinhalese ethnic majority and the announcement was criticised by two civil society activists.

One, Paikiasothy Saravanamuttu, said the police had done nothing to democratise Sri Lanka and asked why such grants should not be offered for every Sri Lankan child.

Another, Herman Kumara, said these special family grants continued a process of social “militarisation” and financial help should be given to farmers, fishermen and other food producers.

The police spokesman, Ajith Rohana, said however that his colleagues did a risky and difficult job and deserved such concessions.

Sri Lanka has a relatively low fertility rate of less than two children per woman.

A police officer, speaking on condition of anonymity, said he would not be having a third child simply to get the grant.

“You can't bring a child up with 100,000 rupees,” he said.

© BBC News

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What a shootout between two politicians says about a nation

By Edward Mortimer | Huffington Post
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Since the end of its civil war against the ruthless Tamil Tigers (LTTE) in 2009, the Sri Lankan regime's own reputation for ruthlessness has grown. At its heart are the three Rajapaksa brothers - President Mahinda, defence secretary Gotabhaya ("Gota") and Economic Development Minister Basil - controlling a formidable military force that has quashed all resistance and committed many grave human rights abuses. For the Tamil and Muslim minorities, the end of the war has been marked by further discrimination and alienation. But for many who belong to the country's majority Sinhalese community, government restrictions on personal freedoms and the relentless militarisation of the island have seemed like a small price to pay for the prospect of national security and an end to the LTTE's brutal campaign for a separate state... until a disturbing incident last month provoked unease and dissent even in conservative Sinhalese circles.

On 8 October, in the Kolonnawa district of Sri Lanka's commercial capital, Colombo, Bharatha Lakshman Premachandra, an adviser on trade union affairs to the Sri Lankan president, was killed in broad daylight during a shoot-out with a group led by another parliamentarian, Duminda Silva, a Colombo district MP who had worked closely with Gota Rajapaksa. (Silva's website states he was the Ministry of Defence's monitoring officer - something the MoD is now struggling to deny.)

Premachandra and three of his supporters died on the spot. They had been shot repeatedly from head to toe with T-56 assault rifles. A police source said that at least 40 rounds were fired.

Two of the bullets ripped through Silva's skull. He was rushed to hospital and put on life support. A few days ago, the Sri Lankan press reported that he had been taken abroad for further treatment. During a parliamentary exchange the Leader of the House confirmed that no police statement had been taken from Silva because he had been judged unfit to speak. He added that Silva could not be prevented from leaving the country as "police had not identified him as a suspect". Gone is the man who might have been able to shed light on this shocking incident, a man alleged to have connections to the defence secretary and the Colombo underworld.

So what do we know? According to the police, violence between the two factions involved is both commonplace and common knowledge. But Premachandra and Silva were prominent politicians belonging to the ruling United People's Freedom Alliance, not gang members. And the timing of the shooting - just two hours before the close of local elections - also points to a political, not a strictly criminal, cause.

This is the stuff of gangster stories, of the Mafia and Camorra, of Martin Scorsese films. In Sri Lanka, it is just another day. Following the attack the Minister for Construction Wimal Weeranwansa - an ardent Rajapaksa supporter whose manufactured anti-UN protests have provoked much derision - told a public meeting that "when a politician goes with an underworld gang and shoots another politician dead, it is not good for the country". A breathtaking understatement that reveals the true nature of today's Sri Lanka.

President Mahinda Rajapaksa has sought to create the illusion of a government that is strong and united, but this incident hints at the truth: Sri Lanka in is disarray. The Sunday Leader, a Sri Lankan broadsheet newspaper, has described the country as 'Oppressed North, Lawless South', where top politicians like the all-powerful Gota display thuggish behaviour and criminal affiliations. These are not mavericks or exceptions. Several other politicians have been involved in similar incidents. Mervyn Silva, for instance, currently Deputy Minister of Highways - previously Deputy Minister of Mass Media & Information, once tied a government official to a tree for his alleged failure to attend a dengue fever prevention programme. His name was also mentioned in connection with the murder of journalist Lasantha Wickrematunge in 2009.

Yet somehow, the Rajapaksa regime has managed to persuade the international community to believe in a very different Sri Lanka. At the Commonwealth heads of state meeting in Australia, just three weeks after the shooting, most leaders - with the notable exception of Canada - were happy to avoid discussing the human rights record of the country that will be hosting their meeting in 2013, whilst Sri Lankan representatives dismissed a UN war crimes report as "a travesty of justice and preposterous". They must have been delighted when the meeting's host, Australian prime minister Julia Gillard, said that Sri Lanka had to deal with its human rights issues itself.

On 14 and 15 November, foreign governments again fuelled the Rajapaksa myth by wining and dining with Gota during the 'Galle Dialogue' sessions in Sri Lanka. The guest list included representatives from Canada, Australia, France and the UK who had been invited to discuss strategic co-operation in the Indian Ocean. This sort of PR stunt, aimed at bolstering Sri Lanka's international reputation, would have been a golden opportunity for countries to take a stand. But instead of boycotting the event, the international community showed once again that it has little to offer other than platitudes.

Within the country at least, dissent is beginning to take hold. Last month's shoot-out sparked a newspaper frenzy, with much speculation on whether the defence secretary has been protecting Silva. Familiar allegations of Gota's connections to well-known thugs and criminals have gained a new lease of life, particularly the nature of his relationship with Silva, which many believe is the reason why Silva has not been named as a suspect in the shoot-out investigation and was allowed to leave the country. And this time, dissenting voices like the Sunday Leader have been joined by others that normally support the government (or are too afraid to speak out) such as Colombo Page and the Daily Mirror.

Sadly, the response has been another media clampdown. Two Sri Lankan news websites featuring articles and footage related to the incident, Lanka e News and Lanka Newsweb, have been blocked - another sign that, even though the war ended more than two years ago, the Rajapaksa regime is not ready to release its iron grip. Dissenters are still routinely accused of being LTTE supporters and are threatened or harassed, if not worse.

Sri Lanka's Sinhalese elite is finally realising that the end of the war will not bring freedom, rights or accountability. It is time that the global community wakes up too.

© Huffington Post

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Unruly govt. MPs try to manhandle opposition members during budget

By Kelum Bandara and Yohan Perera | Daily Mirror
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Parliamentary business was relegated to rowdy levels today during the budget speech of President Mahinda Rajapaksa with some unruly government MPs trying to manhandle and rough up UNP members who held aloft placards critical of the 2012 budget.

In the middle of the President’s budgetary speech, UNP MPs started shouting slogans against the budgetary proposals. They also rose on their feet holding aloft placards which said ‘Shame’ in all the three languages.

However, the action by the UNP provoked some government benchers to react angrily. Ruling party MP from the Kandy District Lohan Ratwatte was the first to run down towards the seat of Chief Opposition MP John Amaratunga. MP Ratwatte grabbed the placard that was in the hands of Mr. Amaratunga and ran back to his seat. His action appeared to be a signal for his other colleagues to unleash their anger against the UNP MPs.

Followed by Mr. Ratwatte, ruling party legislators such as Roshan Ranasinghe from Polonnaruwa, Chamika Buddhadasa from Badulla and Udith Lokubandara started trying to snatch away the placards and posters that were with the UNP members.

The situation led to unpleasant and unparliamentarily scenes in the House with some angry government members throwing water bottles at the UNP members. Heated cross talks ensued between the members of the two sides, and in one instance, MP Buddhadasa almost traded blows with UNP MP from Badulla Harin Fernando.

Deputy Education Minister Gamini Vijith Wijayamuni Zoisa also stormed into the well of the House and threw away the books and documents placed on the desks of the UNP members. Deputy Minister of Ports Development Rohitha Abeygunawardane then approached the seat of UNP MP Mangala Samaraweera and started confronting him with un-parliamentary language.

However, some senior government members such as Bandula Gunawardane were seen trying to calm their colleagues down and prevent any possible violent incidents.

The scenes that were unbecoming of parliamentarians were seen even by the members of the diplomatic missions in the Speaker’s gallery. After the incident, all the UNP MPs left the chamber.

They were heard saying that the violence used by the government to suppress the rights of people is now being used inside the House as well.
Despite the commotion created by the members, the President continued with his speech.

© Daily Mirror

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