President Anura Kumara Dissanayake walked the diplomatic tightrope in December when he made his first international visit as the island nation’s new president to New Delhi.
Dissanayake’s party, the Janatha Vimukthi Peramuna (JVP) of old, is known for both anti-India sentiments and strong opposition to the India-brokered 13th Amendment to the Sri Lankan Constitution that sought to devolve power to the provinces, which the JVP felt was a provision aiding separatism in the Tamil majority areas.
This discomfort apart, the discussions went smoothly, and the political pragmatism of choosing Delhi over Beijing is a message that the JVP/NPP has a softened and practical approach towards India.
India meanwhile is increasingly concerned about China’s overtures to neighbouring countries and, as far as Sri Lanka goes, Beijing’s economic and military influence. China’s “research vessels” are disconcerting to India and there have been a few docking close to Colombo. In December, President Dissanayake assured Indian leaders that he would prevent anyone from using Sri Lankan territory for activities inimical to India’s interests.
Relations with China became strained when the island’s economy hit rock bottom and loans could not be serviced. It had taken time and effort to reach an agreement with Sri Lanka’s largest bilateral lender before chalking a contract with the International Monetary Fund (IMF). Sri Lanka owes Beijing a hefty $4.2 billion in debt, restructured in October 2023, marking a key milestone in the nation’s path to economic recovery.
The new president must navigate complex geopolitics between Asia’s two powers. He is also watched by many. It is not just India and China that keep their gaze fixed on the president but also the US with its strategic interests and historical relationship with Colombo. The US wants to continue its engagement with Sri Lanka, and it is a relationship the JVP/NPP will have to navigate with care, knowing that they would not be viewed with the same lens as the predecessors.
This year will require Dissanayake to practice the political tightrope walk more as he dabbles in measured politics and diplomacy while catering to public expectations, no mean task given the island’s cash-strapped status and the inherited economic woes.
Meanwhile, on Monday, the cabinet will receive a proposal to appoint a committee to review Adani Group’s wind energy projects in Sri Lanka. The projects focus on constructing wind power plants in Mannar and Pooneryn in the island’s North, which the previous administration approved. The committee is to review them and recommend restructuring where necessary.
However, in a highly precarious balancing act, Dissanayake will end up deferring matters like the Economic and Technology Cooperation Agreement to enhance economic and technological cooperation between the two countries or fully implement the 13th Amendment, giving minority Tamils a measure of political autonomy.
Sri Lanka is still trying to emerge from an unprecedented economic crisis that imposed punishing burdens on the people. While balancing the geostrategic interests, President Dissanayake will be required to deliver on the economic front, ensure growth, offer relief for the poorer sections, deliver on specific promises, including fighting corruption, addressing rights anomalies and creating a long-term plan for complete economic recovery. His plate is more than full.
Back to Beijing. Dissanayake has to be sharper when tackling Beijing, the nation’s largest bilateral lender. China has invested heavily in Sri Lanka, and India has, too, and the competing interests need careful management. According to political scientists, the choice to avoid aligning Colombo to either power is a good start. Dissanayake will soon find out Beijing’s expectations of Colombo’s new administration.
It is known that the 99-year lease of the Hambantota Port and the port city initiative in Colombo has made Sri Lanka’s economy bleed. The pain of high-interest commercial loans will only be felt when the country starts repaying debt. Analysts expect the government to come under pressure amid growing geopolitical competition as geostrategic rivalries intensify.
As for now, his supporters are keen to see the island turn a new leaf, giving expression to the systemic change promised during election time, by tacking economic travails and the legacy of misrule.
It is here that Dissanayake, for all good intentions and efforts, may find himself crippled. Due to the financial meltdown and the austerity measures imposed by the IMF, there is little room to increase public welfare measures. Some changes have already been made by increasing poor relief and slight tax reductions, but they are insufficient to appease an impatient populace waiting for relief. The government’s unprecedented majority of 159 seats in a 225-seater parliament is a sweeping mandate, but one that will call for delivery.
The pledges include structural reforms, punishing the corrupt and opening criminal cases swept under the carpet by the previous regimes. The pre-negotiated IMF bailout package also constrains Dissanayake. Despite lofty pledges during his campaign to renegotiate the deal, the reality is there is little room for navigation.
The president himself admitted to this when addressing the new parliament. He said Sri Lanka’s economy was extremely fragile and it was not possible to make a single wrong move or go into the merits and demerits of the agreement as there was no way to start the process all over again. “The economy is in such a state that it cannot take the slightest shock… There’s no room to make mistakes,” he said.
A pathway has been created to dredge the country out of the economic abyss. It is not of Dissanayake’s making, but it will be his responsibility to deal with the recovery phase.
Irrespective of the financial status, the rumblings will increase, and it will become necessary for the administration to seriously address the people’s grievances, bring down the cost of living and offer relief.
Sri Lanka will go to the polls soon to elect members of the local authorities, followed by the provincial councils. There will be no time to introduce electoral reforms before the elections. A single wrong move can be costly for the island’s new administration.
(Views are personal)
(dilrukshi@cir.lk)
(dilrukshihandunnetti@gmail.com)
Dilrukshi Handunnetti | Award-winning journalist and lawyer. She is a founder and director of the Colombo-based Center for Investigative Reporting (CIR)