BBS championing change: Dilantha

April 19, 2013 

“We are not engaged in any activities that are harmful to society, nor are we causing religious disharmony,” claims Bodu Bala Sena strongman Dilantha Withanage.

“We do not want to get into politics,” says Withanage, Chief Executive Officer of the Bodu Bala Sena Headquarters, adding that the
movement does not want to topple
governments or form a government but needs an immediate change in the present condition in the
country. Following are excerpts of the interview:

• Denies political agenda; says objective is to establish Buddhist society; claims Muslims are not under threat

Q: How would you describe the Bodu Bala Sena?

A Bodu Bala Sena is not a political party. Some think it is a non-government organisation funded by various factors, but we are not an NGO. We are a civil society movement led by Buddhist monks. Our goal is to promote Buddhist leadership for economic development. Bodu Bala Sena was started by five members comprising four Buddhist monks and myself. Today we are a group with a large number of contributors. We don’t like to use the word members; but we have contributors which in Sinhala we describe as ‘dayakaya’.
A large number of Buddhist monks, intellectuals, professionals and especially youth debated the need for an organisation like Bodu Bala Sena. They highlighted the need of promoting Buddhism in Sri Lanka as well as protecting Buddhism in this country. This was one of the main reasons behind starting Bodu Bala Sena.

Q: But there are existing organisations that promote Buddhism and its teachings; why did you want to start a new movement?

A: According to our Constitution, Buddhism should be given foremost priority. But we believe this is not practiced in Sri Lanka at present. Buddhism is not given due recognition in this country. We may have the dharma chakra in our national emblem; there may be Buddhist statues in every corner in the country; but the question is whether Buddhism is properly practiced in this country.
During Vesak we see a large number of dansalas and pandols throughout the country. But who is funding these? The liquor shop owners and meat shop owners. I don’t blame people who consume liquor or I don’t say everyone should become vegetarians, but according to Buddhism these things are prohibited. How many rape cases are reported a day? How many cases of child abuse and killings take place in a day in our country? A trivial incident ends up as a violent act, resulting in murder. We can’t just blame society for this violent behaviour, because there is a reason why people act in such a way.
Our country was under imperialists for a long period of time. They ruined the roots of Buddhism in this country. Although they left, our leaders continued their agendas. Various leaders come into power labelling themselves as Buddhists and patriots, but they all follow what the British and others did. Then the war worsened things. Our prime objective is to put an end to this and establish a Buddhist society in our country once again.
Meanwhile, although the Constitution says foremost priority should be given to Buddhism, it doesn’t say anywhere that Buddhism is our State religion. Countries like Bangladesh clearly say that Islam is their State religion. We need to put things in the right place. That is what we want. This is a country that doesn’t even practice the five basic principles of Buddhism. We need to change this.

Q: Are you saying the leaders in this country have failed to protect Buddhism?

A: I don’t blame the leaders. I blame society.

Q: Protecting Buddhism was one of the main slogans of the Mahinda Rajapaksa Government. Are you saying it has failed to fulfil its promises?

A: I can’t blame just one president or one government. All rulers should be blamed. They are all responsible for the situation in this country today. But I have to say that the present President has shown more support towards Buddhism. Unfortunately, he has no proper power to exercise his wishes

.
Q: How can you say the President has no power when he has a two-thirds majority in Parliament?

A: When the recent Fashion Bug attack took place, his ministers went to the President and asked him to call for a debate in Parliament on this incident. There was a lot of pressure by the ministers, requesting the President to ban the Bodu Bala Sena. So can you say the President has powers when he couldn’t safeguard an innocent Buddhist organisation like us? We are not engaged in any activities that are harmful to society.

Q: The President did not call for a Parliament debate, nor did he ban the BBS.

A: Yes, but there is lot of pressure asking the President to ban us. To develop a country we need to have intelligent politicians. Unfortunately our politicians act according to the gossip they hear. In Kalmunai they have passed a resolution to ban the Bodu Bala Sena. We don’t have any issues with that. But these are democratic rights enjoyed by everybody. This resolution was merely passed based on the gossip and rumours they heard about us. That is not acceptable. When a politician requests a ban of the Bodu Bala Sena, they should first conduct a proper investigation; there should be a charge sheet against us. They go to Geneva and say one thing and practice something totally different here in the country.

Q: What are you trying to achieve? What is your ultimate goal?

A: The Bodu Bala Sena does not want to get into politics. We don’t want to topple governments or form a government. But we need a change and we need to do it soon. We want to have a developed country under a Buddhist leadership. Why do you think thousands of women go to Middle East countries as domestic workers, why do we find youth struggling to find jobs in Korea? Simply because our economic conditions are not doing well.
A Sri Lankan youth has to work 25 years to earn the same income Singaporean youth will earn in a year. This is the problem of this country. Believe me, if we have correct economic management, we can even go up to US$ 10,000 per capita income.
I read the ‘Mahinda Chinthana’. It is a good document. But whether it is implemented properly is the question. We can clearly see that the benefits of the development programs carried out by the Government do not go to the grass root level.
Requesting the banning of the Halal certification was not our first activity. We had organised a couple of activities before. But no publicity was given to any of those activities. We strongly believe that Buddhists should boycott the Halal certification. That is the right of Buddhists. Anyone can make such a request. How can someone say it is a terrorist activity?
We don’t have anything against Muslims consuming Halal food. If there is a need for the business community to import Halal food, let them do that; we are not against that either. We are against the issuance of illegal Halal certificates in Sri Lanka. We exposed that Halal certification money goes to Hamas in Canada. We exposed researched documents by a Canadian research company. The very next week Gulf News published an article labelling us as a terror organisation. Gulf News also published that we have attacked Muslims in Embilipitiya and Kandy. We were not involved in such incidents. How can you justify publishing such false article without getting a comment from us? That led to many unnecessary incidents.
The Daily Financial Times is a well-recognised newspaper, mainly read by the business community and diplomatic community. After your paper published the Gulf News article, people started to believe the Bodu Bala Sena is a terrorist organisation. Today the BBS is facing a lot of difficulties because of that article.

Q: Why do you call yourself Bodu Bala Sena and act against the teachings and principles of Buddhism?
A: Let me tell you one thing, because of Bodu Bala Sena the so-called Buddhists who never talked about Buddhism now talk about ‘true Buddhism’. We are happy about this change. It is a win for us. The Buddhists who were asleep all this time have woken up today – especially the Colombo Buddhists who were afraid to tell the world that they were Buddhists are suddenly claiming to be the best Buddhists in this country. We are happy about these developments. This is what we expected; this is what we wanted.

Q: Are you saying BBS acts according to the concepts, teachings and principles of Buddhism?
A: Definitely! We are not doing anything against Buddhism. Can you prove that BBS has done anything harmful to Buddhism? Can anyone prove that BBS has promoted violence in this country? I will challenge anybody who says that we are against Buddhism. People say we attack Muslims. Bring a single Muslim who was attacked by us. Find out any Muslim shop that we have attacked. You can’t because there are no such incidents. We are not involved in any such incidents.
We never asked to ban Halal in Sri Lanka. We only asked to ban Halal certification, which is illegal in Sri Lanka. But Muslim ministers gave negative and false publicity saying that the BBS is threatening to ban Halal in Sri Lanka. That is how this all started. And today they are trying to put the blame on us.
Let me explain why we say Halal certification process in Sri Lanka is illegal. In 2006 the Consumer Protection Authority issued a gazette notification saying the All Ceylon Jamaiythul Ulama organisation has the sole right to issue the Halal certification. According to the Consumer Protection Authority Act, no organisation should enjoy a monopoly. Therefore, in 2007 it was abolished by the Government using a similar gazette notification. But it was not published. The All Ceylon Jamaiythul Ulama organisation doesn’t have the right to do it. That is why the Cabinet subcommittee decided the process was illegal. This is what our fight is all about.

Q: It is clear that this is purely a legal matter. Why did you initiate public agitation when you could have easily taken legal action to stop the Halal certification process if it was illegal as you claim?

A: Public awareness is something accepted by the whole world. We made a request to the Government. We invited the All Ceylon Jamaiythul Ulama organisation for a discussion in January this year. But they did not come. Then we started educating the public. There is no wrong in that. For the Government to change the present process, we need to have some pressure. That is what we are doing.
Thousands of people came for these meetings. When they left, they went in buses. If they wanted to harm any Muslims or attack any Muslim shops, they could have done that easily. But nothing happened. Bodu Bala Sena did not initiate this hate campaign against the Muslims. We don’t take the responsibility for that.

Q: If it is not Bodu Bala Sena, who is behind these attacks? As a responsible Buddhist movement, don’t you have a duty to find out who is promoting these acts?

A: The rivalry between NoLimit and another clothing store initiated long before Bodu Bala Sena was started. Why do people want to put the blame on us? When the Welimada incident took place, we appealed to our supporters not to engage in any violent activities. In a press statement we requested them not to take law and order into their hands. We requested the Police to take measure to ensure no clashes would take place. We act responsibly, we take all necessary measures. I personally have a constant dialogue with the Ulama members. Unfortunately some of them try to teach us Buddhism.
Meanwhile, the media is also to be blamed. When a Sinhala man rapes a Muslim girl it becomes the lead news story. But when a Muslim man rapes a Sinhala girl, that news is censored. Why? To prevent clashes.
Who are these Muslims who are being harassed? Travel around Colombo and see whether any Muslim is being harassed. What is this nonsense? Other than Fashion Bug, what are the other shops that were attacked? There are over 2,000 mosques. They were not attacked or damaged by us. There was only one incident reported. That was in Beruwala. Who set fire to that mosque? Muslims. It was proved that the mosque was burnt by Muslims.
We know for a fact that in some areas Sinhala people are threatened by fundamentalists. Why don’t you talk about these things? Remember, every Buddhist monk is not linked to the BBS. We never encourage our contributors to attack Muslims.

Q: Are you trying to say Muslims are not under threat? Do you think they enjoy the same freedom they had a year ago?

A: There is no such threat. I meet Muslims, I talk to them daily. They are doing their businesses well. This so-called threat on Muslims was only created by politicians and the media. Why did we become so popular within just 11 months? Today we are known around the world. It took almost a decade for the LTTE to get into the feelings of the Tamils. But just within 11 months we have become a respected movement among the Buddhists.
Although we don’t openly talk about these things there has always been a clash between the Muslims and the Sinhalese. The Sinhalese were pressurised by the Muslims. The Sinhalese were not pleased with the manner in which Muslims constructed mosques in every corner in the country. Be thankful that a fundamentalist political party has not taken our place; then things would have been disastrous.  Even the academics in this country are not responsible and reasonable people. Recently a group of academics signed a petition to Mobitel, requesting the ban of a ringing tone. I can’t understand why they behave in manner. There are other serious matters for the academics to think about rather than fighting for a ringing tone.
Why do they want to ban our ringing tone? They are violating our fundamental rights. These are the same set of academics who signed documents five years ago supporting the President. After just one year, they get into streets against the same President. What type of academics are these?

Q: You maintain that BBS is against a violent society. But you make statements on the lines of the BBS being ready to throw eggs at cricketers who participated at the IPL. Why do you make such aggressive statements? Do you believe you can achieve your goals with this kind of behaviour?

A: Sometimes BBS invites guest speakers to our discussions and conferences. They make various comments. Then when the media highlights all the unnecessary things these speakers said, the people blame the BBS.
I personally feel some of the statements made by us are not acceptable. This is an issue we need to discuss and solve internally. However, where the ILP matter is concerned, I need to clarify a few things. BBS is against cricket. Cricket has done no good for this country. No developed country encourages this sport simply because cricket is an utter waste of time. But it is sport that involves good money.
People respect and love our cricketers. They treat them as heroes. But most of our cricketers think only about the money; they never think about the country. When Gnanasara Thero made that statement, he was trying to make people aware of this situation. He didn’t mean that we are going to throw eggs; his only intention was to make cricket less popular among Sri Lankans.
But why do you only see the bad in us? Why don’t you accept the fact it is because of us there are less clashes in this country? When a Buddhist monk was attacked in India, fractions in Sri Lanka were planning to attack Tamils. But we intervened and stopped that. Nobody talks about these things.

Q: Is it true that you have the support of the Government?

Some say we get funds from Norway. Some thought it was Ranil Wickremesinghe who was behind the BBS. The Government thought Sarath Fonseka was funding us. Due to all this speculation, I was asked to leave my job as a ministerial advisor.  We don’t have the support of the Government. Initially both the President and Defence Secretary did not have a pleasant idea about BBS. We wanted to meet the President but we never got an opportunity. We sent a letter to the Defence Secretary requesting a discussion with him, but he replied saying he was too busy to meet us. Then the ulamas went and complained about us to the President.
We were asked to meet the President and we were told that the President was going to ban our movement. However, after a nearly a two-hour discussion with the President, he understood what BBS was all about. The Defence Secretary too today has a better idea about our movement. But he has no involvement in BBS as everyone speculates. These are just rumours.

ESTATE WORKERS’ PROTEST BLOCKED…

April 21, 2013 

A protest planned to be held at the Kotagala Town by the Up Country Trade Union Alliance (UTUA) demanding a wage increase of Rs 520 for plantation workers was obstructed today (21). DPF leader Mano Ganesan, NSSP leader Dr. Vickramabahu Karunaratne, trade unionist Siritunga Jayasuriya as well as MPs V. Radhakrishnan and Palani Digambaram of the Upcountry People’s Front participated in the protest. However, police prevented estate workers from taking part in the protest, which was later shifted to the Dimbulapathana Junction. (Pic by Ranjith Rajapaksa)

What Protection Does A Protestor Holding A Candle Have?

By Kishali Pinto-Jayawardena -April 21, 2013 |

Kishali Pinto-Jayawardena

Hate pervades the air. It is sadly grotesque that amidst the Avurudu time of reflection and thanksgiving, what prevails is exactly the opposite.

Just this week, in the Ratnapura District, plantation workers of Tamil ethnicity clashed with Sinhalese villagers ironically enough after a Sinhala and Tamil New Year musical show. The clash was apparently provoked by remarks hurled by a few Sinhalese youth at some Tamil girls in the crowd, leading to retaliatory abusive comments by (presumably male) defenders of the girls.

Vitriolic abuse by politico-religious lobbies

This would ordinarily have merely amounted to temporary tensions caused by too much unwise revelry. However, it escalated into a bigger problem underlying simmering tensions between the groups when surrounding villagers joined in the fracas, with the housing scheme where Tamil plantation workers lived in the area, later getting pelted with stones. While interventions by community elders had managed to prevent the situation from getting worse, the trigger point of distrust remains.

This is just one incident which underscores the ugly heightening of tensions between communities in this country where during recent months, Muslims and Tamils have been at the end of vitriolic racist abuse by highly vocal lobbies masquerading in religious garb. Predictably enough, such carefully orchestrated campaigns, which are allowed to run unfettered by this government, results in the spilling over of tensions into physical fisticuffs even in instances that would not normally be the case. Tellingly, the spate of similar incidents in recent times certainly exceeds occurrences of this nature, even at the worst of the war inflicted years.

Arrest of peaceful protestors holding candles

Indeed, the level of hate in this county as well as the conscienceless support given by the police to the hate mongers was well demonstrated by the outpouring of zenophobic anger by these same hate mongers when a spontaneous demonstration was held by some days ago on Havelock Road by citizens protesting against the anti-Muslim invective of the Bodu Bala Sena. Descending from tragedy to farce, the police officers on the scene arrested those who were peacefully holding candles rather than those who were violating the Penal Code by their hate filled chants. Is this what this country has come to now? Is this what ostensible peacetime has brought us?

Arresting peaceful protestors under spurious justifications that barely mask the determination of the government to allow only its view and those of its adherents to prevail is nothing new. We have seen similar police excessiveness against family members of disappeared persons, trade union activists protesting against corruption and even ordinary villagers peacefully protesting against arbitrary acquisitions of their lands.

The applicable legal standards are, of course, perfectly clear. No peaceful protestor can be threatened that he or she has infringed the law. Vague police threats that law and order is disturbed by peaceful protest do not suffice.

Protest fundamental to the democratic way of life

None other would know best of this basic legal principle than President Mahinda Rajapaksa himself, that most vociferous protestor during his days as an opposition politician. In fact, one of the most stirring pronouncements that the Sri Lankan Supreme Court ever made in this context was when the ‘Jana Ghosha’ movement in which he was a prime mover, was sought to be suppressed. Here, several political parties including the Sri Lanka Freedom Party engaged in a ‘noise protest’ as a means of showing their disapproval of the policies and actions of the government.

The protestors were assaulted and tear gassed. Famously, in striking these police actions down, the judges reminded the then United National Party government that “the right to support or to criticize governments and political parties, policies and programmes is fundamental to the democratic way of life, and the freedom of speech and expression is one which cannot be denied without violating those fundamental principles of liberty and justice which lie at the base of all civil and political institutions” (Amaratunga v Sirimal and others, [1993] 1 Sri LR 264).

Legal standards now no more

For that matter, even exaggerated criticisms of government are encompassed within the protection of the law in theory as affirmed by numerous judgments of the Supreme Court. Judicial warnings in this regard are prolific.

As observed most fittingly in one instance where the Court ruled against the arrest of participants in a discussion who had been accused of conspiracy after police officers had eavesdropped on their speeches exhorting citizens to topple the government, vehement, caustic and unpleasantly sharp attacks on the government, the President, Ministers, elected representatives or public officers are not per se unlawful (Channa Peiris and others v AG and others, [1994] 1Sri LR 01).

These legal standards proudly developed by the Sri Lankan Supreme Court throughout the past few decades are now as they have been dissolved into thin air. They are legal theory now, no more and no less, obscenely refuted by brutish reality. In a country where a sitting Chief Justice can be taken before parliamentarians and grossly humiliated, what protection does the ordinary citizen have when holding a candle and engaging in a peaceful protest? This is a pitiable question indeed.

Courageous voices of dissent

Yet for those of us who are alive to the humiliation and subjugation of peaceful protest in Sri Lanka, what is happening now is unacceptable. Commendably, individuals are in fact, speaking out in increasing numbers against this repression through personal narratives that are crowding social media. For many others who are oblivious to such happenings so long as they do not touch themselves or the members of their families personally, there is of course, no such problem.

But even the most ostrich-like in our midst should wake up to the portentous signs of pending racial and religious conflagration in which very few would be safe. Willful blindness to hate rhetoric that fills the air around us should stop at least now. Martin Luther King once said magnificently that ‘our lives begin to end the day we become silent about the things that matter. In the end, we will remember not the words of our enemies but the silence of or friends.’ His ringing words extolling courage should be hearkened to during these extraordinary times of despair.

Treasury go-ahead awaited to conduct fresh aerial geophysical survey

To assess Sri Lanka’s rich sub-surface mineral wealth
A significant boost to proposed foreign investment
— Minister Susil Premajayantha

By Suresh Perera-April 20, 2013, 

In a significant boost to proposed foreign investment in exploiting Sri Lanka’s sub-surface mineral wealth, the government is contemplating conducting a fresh aerial geophysical survey after a span of more than 50 years.

"We are awaiting the green light from the Treasury to go ahead with this vital task, the cost of which runs into millions of dollars", says Susil Premajayantha, Minister of Environment and Renewable Energy.

This is welcome news to the country’s mining industry, which has consistently expressed concern over the prolonged delay in carrying out a modern, state-of-the-art aerial geophysical survey as, despite Sri Lanka’s rich mineral resources, the last effort in this regard was made in 1957-58 — more than half a century ago.

"We will embark on the mission when the necessary funds are sanctioned by the Treasury", the Minister told The Sunday Island yesterday. "We are also eager to get on with the job".

The government is keen to attract foreign investors into this lucrative sphere, but the biggest disincentive is the absence of geophysical data based on modern technology to assess the country’s rich mineral resources, industry players said.

With an outdated airborne geophysical survey done more than 50 years ago, it is next to impossible to offer an incentive to key global players in this segment", they pointed out. "We need to make use of modern techniques for this purpose".

Unlike Australia, Sri Lanka is a small country with limited financial resources, Minister Premajayantha noted. "We need to raise US$ 15 million for this survey to detect sub-surface mineral wealth".

That’s a lot of money, he pointed out. "The Treasury will examine the key aspect of economic viability before giving the go-ahead".

At present, the Geological Survey and Mines Bureau (GSMB) is employing other techniques to assess the country’s mineral resources, he explained.

No foreign investor will express interest if Sri Lanka is not armed with geophysical data based on modern technology as these are enormous investments involving millions of dollars, industry officials said.

"When we are ready, they will come or else, these potential investors will opt out", they said. "That’s why it is important to have the ground work done".

 Funding for this effort is the main issue as the aerial operation costs around US$ 16 to 17 million, GSMB’s Chairman, Dr. Nara P. Wijayananda said.

"We are waiting for the final clearance for funding from the Finance Ministry to undertake this survey", he explained.

The GSMB earlier fell back on the position that an airborne geophysical survey could not be undertaken during the past 30 years due to security reasons. Its contention was that aircraft has to fly at a lower altitude and companies declined to take up the job due to the risk they had to face, industry officials recalled.

But, more than three years after the war ended, nothing has been done so far to conduct this crucial survey, they complained. "Earlier, they were griping over the war and now over funding".

Wijayananda said an aerial geophysical survey is only one of the tools used in mineral exploration. There are other powerful and basic tools such as (a) basement geological mapping (all maps completed and published), quaternary geological and geochemical mapping (started three years back and continuing).

"During past two years, we have identified new clay (ball clay and kaolin) deposits for tile and porcelain industries. Tile and porcelain companies are in the process exploiting these deposits", he said.

"It is our view that such surveys should be undertaken by the government using State funds as then the government itself can decide on the development of any new findings so that the country will get its best share", the Chairman explained.

"The survey would help us to detect anomalies which could lead to the discovery of new subsurface mineral deposits, Wijayananda explained. "We are conscious of its critical importance, but we need to line up the funds".

It is no secret that finding the right investors for mining projects translates into millions of dollars in dividends for Sri Lanka, industry players noted. "There are some countries where mining mineral resources largely finance the running of entire economies because big companies work on a profit-sharing basis with governments".

It is unfortunate that in a country, where there is rich mineral wealth to be exploited, the geophysical survey has been relegated to the backburner, they complained.

"No, that’s not the case", the Chairman shot back.  "The government is keen to undertake this study as soon as the finances are sorted out".

What has the GSMB done for 50 years as it has been widely acknowledged that the biggest impediment to identifying and exploring Sri Lanka’s mineral wealth is an obsolete Aeromagnetic coverage done in 1957-58, they said. "It, however, covered only a part of the country".

A survey was done in 1960 as well, but all that is outdated now, he conceded. "We need to make use of modern technology".

"We have already issued exploration licenses for subsurface graphite, iron and cement limestones for local and foreign investors. Serious investigations have also been undertaken for these minerals", Wijayananda said.

"Sri Lanka has been skirting on surface exploration of mineral resources (except for Bogala and Kahatagaha mines). Why have we not gone into subsurface exploration which is the need of the hour to make optimum use of our mineral wealth?", the officials queried.

It is unfortunate that the country’s mining industry has been relatively stagnant and still remains in a primitive stage, they asserted. "It lacks impetus".

"That’s not correct. The government has invested substantially in acquiring new technology and training new local staff on state-of-the-art technology. We are optimistic that more new deposits would be developed in the near future which would give a positive impact on the economy of the country", Wijayananda explained.

Three fundamental economic challenges

Sunday, April 21, 2013

The three most important challenges facing the economy are the containment of the fiscal deficit, lessening the trade deficit and reducing the public debt: especially its foreign debt component. Unless there is significant progress in reducing these, the resultant economic instability would hamper sustained economic growth.

The most important economic objective of the government should be to reduce the fiscal deficit from the current 6.4 percent of GDP to around 5 percent in the next few years. The reduction of the fiscal deficit is essential, as a large deficit has diverse adverse impacts on the economy. Large fiscal deficits generate inflationary pressures, increase the public debt and distort public expenditure priorities.�

Fiscal deficits increase the cost of living that lead to strikes with demands for higher wages and industrial unrest. Wage increases add to the costs of production and reduce export competitiveness. The depreciation of the currency to restore export competitiveness would lead to further inflation and increased hardships. Inflation causes severe hardships to lower wage earners pensioners and fixed income earners.

Large fiscal deficits lead to borrowing and in turn to huge debt servicing costs. Sri Lanka’s huge accumulated debt is a result of persistent deficits over the years. The massive public debt servicing costs distort public expenditure priorities and hampers economic development.

Committed to reduce deficit

In spite of strong official commitment, the government failed to achieve its fiscal deficit target of a 6.2 percent last year. Even the 6.4 percent fiscal deficit was achieved by several expenditures that should have been brought into the government accounts remaining as debts to state banks.�

The target to bring down the fiscal deficit to 5.8 percent of GDP this year is difficult to achieve owing to the continuing high government expenditure, high debt servicing costs, losses of public enterprises and declining revenues. It is, however, important to cut government expenditure and reduce losses in public enterprises to achieve a lesser deficit.

One of the disappointing features of recent fiscal performance has been the decline in the revenue to GDP ratio from an already low 14.3 to 13 percent last year. The collection of 15 percent of GDP as revenue should be the objective for this year. In the next few years government revenue should be enhanced to around 20 percent of GDP to achieve a fiscal deficit of 5 percent or less.

Losses in public enterprises

Losses incurred by public enterprises are a huge fiscal burden. Reforms of these public enterprises to reduce losses provide a significant means of reducing expenditure. The Central Bank has argued this cogently in its Annual Report for 2012. “Improving the financial viability of state owned enterprises would be crucial towards strengthening macroeconomic stability and financial system stability.

Continuous operational losses at the two key state owned enterprises (SOEs), i.e., the Ceylon Electricity Board (CEB) and the Ceylon Petroleum Corporation (CPC), have led these entities to rely heavily on bank borrowings to cover their losses and to continue operations. While revisions to energy prices are a step in the right direction, measures need to be taken to improve the operational efficiency of these entities and introduce a cost reflective flexible pricing policy to transform these enterprises into commercially viable entities and to reduce pressure on commercial banks, thereby making available more resources to the private sector.”

While agreeing that measures need to be taken to improve the operational efficiency of public enterprises, it is difficult to concede that revisions of energy prices are a step in the right direction. Reforms in the management of these public enterprises should be the priority and should precede price increases. The increase in electricity prices would increase the costs of living and the costs of industrial production.

Debt burden

There has been a decrease in the public debt as a proportion of GDP in recent years. In 2002 the public debt was as much as 105 percent of GDP. In subsequent years it has been brought down as a proportion of GDP. In 2011 it was 78.5 percent of GDP. However in 2012 the debt to GDP ratio increased to 79.1 percent of GDP.

Although the debt to GDP ratio declined till last year, the public debt increased substantially. The debt to GDP ratio declined owing to the GDP increasing and the appreciation of the rupee till 2012. (The appreciation of the rupee leads to a lowering of the ratio as the debt is in rupees, while a depreciation has the opposite effect). The debt to GDP ratio is an inadequate, even misleading, indicator of the country’s indebtedness. In 2012, the increase in debt resulted in an increase in the debt to GDP ratio to nearly 80 percent. This was due to increased borrowing, the depreciation of the currency, and the slower economic growth of last year.

Debt servicing costs

The debt servicing cost as a proportion of revenue is a better indicator of the crippling effect of the large public debt. In 2011, debt servicing payments absorbed 95.8 percent of revenue. In 2012 debt servicing costs were higher than the government revenue: 103 percent of government revenue. This means that government has to borrow for its other expenditures. This in turn increases the public debt.

Foreign debt

The increasing foreign debt is a serious concern. The increase in foreign debt was particularly sharp after 2008. In 2011 the foreign debt was Rs. 2,329,280 million, which was 35.6 percent of GDP. In 2012 it has risen to Rs. 2,767299 million that was 36.5 percent of GDP. It is not certain as to whether all foreign borrowings are included in these figures.�

The foreign debt servicing costs absorbed 16.4 of earnings from exports and services, up from 11.1 percent in 2011.
Since the large foreign debt is a continuing burden on the public finances and the balance of payments, it is important to take measures to reduce the foreign debt burden by generating a significant balance of payments surplus. This requires a reduction in the trade deficit.

Trade deficit

The need to reduce the trade deficit is recognised by the Central Bank. “The deficit in the external current account needs to be narrowed to a sustainable level over the medium term. Improved access to international capital markets and a more flexible exchange rate helped cushion the external sector in 2012. However, policies should focus on narrowing the current account deficit to a more sustainable level by reducing import dependence, improving export competitiveness and diversifying goods and services exports as well as markets. Expenditure on the importation of food and beverages could be significantly reduced through policies being taken to encourage domestic production, particularly in the areas of dairy and sugar production.”

There has been a significant decrease in consumer imports. However intermediate and investment goods continue to increase. Investment goods imports of US$ 4.5 billion that accounted for 23.5 percent of import expenditure have to be reduced to make a significant dent in the import bill.�

The government’s programme of infrastructure development such as roads, bridges and energy generation will contribute to economic development in the long run. However, in consideration of the country’s fiscal constraints, impact on debt, balance of payments difficulties and other priorities, it is important to reconsider the pace and priorities of investment expenditure.

Bottom line

Good governance is essential to achieve the three vital economic goals and to promote an environment that is conducive to higher investment that is needed to spur economic growth. Higher economic growth, achieved by the right composition of output, could in turn lessen the fiscal deficit, reduce the trade gap and decrease public debt.

CPC Sinking Further In Aviation Fuel To Mattala

One of the privately owned long-haul carriers taking aviation fuel to Mattala and Mattala airport

By Nirmala Kannangara-Sunday, April 21, 2013The already cash strapped Ceylon Petroleum Corporation (CPC) is facing further financial losses due to the transportation of aviation fuel to the Mattala Rajapaksa International Airport from the Kolonnawa refinery, claim trade unionists.

Non-availability of aviation fuel tanks at Mattala Rajapaksa International Airport and Hambantota Port has resulted in the Ceylon Petroleum Storage Terminal Limited (CPSTL) a subsidiary of CPC, sending aviation fuel to Mattala regularly in private road bridges (long haul vehicles) at a massive cost to the Corporation.

“For each load of aviation fuel that is sent to Mattala we have to spend Rs. 64,000 as transportation costs. Had we got the aviation tanks at Mattala and Hambantota we would have sent them by sea or if we have our own fleet of road bridges we would have minimized the losses,” said Secretary of the Jathika Sevaka Sangamaya Petroleum Branch Ananda Palitha.

According to Palitha, had the CPSTL its own fleet of road bridges, the transportation cost could have minimized. He said that the corporation’s failure to purchase road bridges over the years had clearly demonstrated the incompetence of the CPC and CPSTL Managements – both comprise the same Board Members.

“When plans were drawn to build the Mattala Rajapaksa International Airport, the CPSTL signed an agreement to supply aviation fuel for the aircraft. Later the management knew that the aviation fuel tanks either at Mattala airport or at the Hambantota Port were not ready to stock the needed aviation fuel for the aircraft that land at Mattala. But they still failed to purchase the necessary number of road bridges to transport this fuel, which is questionable. There was enough time for the CPSTL to call for tenders and purchase those road bridges but they were not interested to do so as they wanted to allow their ‘friends’ who own road bridges to earn extra money,” alleged Palitha.

Five private owned road bridges have been especially epi-coated by the CPSTL to transport aviation fuel to Mattala, which has cost CPSTL Rs.3 lakhs per Road Bridge. According to Palitha this amount would be deducted from the transportation fee.

“The CPSTL is supplying aviation oil to aircraft for the past 40 years but it is a pity as to why they failed to purchase the required number of road bridges in time. The CPC management is now claiming that calling tenders and to purchase these vehicles complying to government regulations takes a long period and that was why they could not purchase the road bridges by the time the airport was opened. This is hilarious. When the management has failed to abide by the government regulations when purchasing fuel which led to much pandemonium, why are they so particular about following government regulations when purchasing road bridges?” asked Palitha.

According to Palitha, had the CPSTL had their own road bridges with a capacity of 33,000 liters, they would have epi-coated them in order to carry aviation fuel to Mattala.

“Had the Hambantota port aviation tanks were ready by the time the airport was opened, CPSTL would have shipped the fuel consignments to Hambantota which would have cost less. From Hambantota port the fuel would have been transported by road since pipelines are yet to be laid from the port to the airport. Sending fuel to Mattala all the way from Kolonnawa in road bridges is an utter waste of money as we are an almost cash strapped institution. We are losing more money now,” said Palitha.

He further said that although the government kept faith in the Chinese to construct the aviation fuel tanks at the Hambantota port, the five aviation fuel tanks that have been constructed is not up to the standard.

“In these five tanks we can only store petrol or diesel but not the aviation fuel. These tanks have to be modified to international standards to store aviation fuel. Had they consulted the CPC, the corporation would have certainly helped to construct the five aviation fuel tanks but due to their failure, the government is losing more money,” added Palitha.

Palitha further observed that that it would be inevitable to stop fuel prices going up in the near future to cover up the losses.
“Although the CPSTL has got to pay transport fees for the road bridges that carry aviation oil to Mattala, there is no way how they can recover them as the aviation fuel cannot be sold for a higher price. If we do that, the airlines would re-fill aircrafts from Chennai.

Ultimately it is the general public that has to bear this extra expenditure. Very soon the government will increase fuel prices to cover up their ‘sins’ and burden the downtrodden masses,” said Palitha.

Meanwhile, a senior official at the CPC on condition of anonymity told The Sunday Leader that the ground under the oil farm at Hambantota port had started sinking and there were many construction defaults in the five aviation fuel tanks.

“This is dangerous. This would have been identified earlier. There are five tanks to store petrol and diesel and five tanks for aviation fuel. If part of the oil tank farm has started sinking what would happen to the ten tanks in future. If the tank areas too begin to sink when the tanks are full with fuel, the consequences would be grave. Since the work started without a proper evaluation this would happen even in other parts in the port in future as well,” said the sources.

He further said the main reason for the delay in constructing Mattala aviation tanks was because the plans that were initially drawn were not in a proper elevation.

“We had to get the plans re-drawn as there were many defects. Initially the elevations were not equal and that was the main reason for the delay. We have now accelerated the work,” said the sources.

Meanwhile, Managing Director, Ceylon Petroleum Corporation, Susantha Silva said that although there is a delay in purchasing the road bridges, CPC is in the process of getting down the necessary number of road bridges at the earliest.
“We cannot go to a certain place and purchase these road bridges, the way we purchase a motor vehicle. We have to call for tenders and then follow the government procurement procedure. That is why the delay is,” said Silva.

Silva further said that they had to face this situation because the Hambantota port aviation fuel tanks were not ready for storage.
“Since five aviation fuel tanks were under construction at Hambantota port we did not have a rush to purchase these road bridges earlier. However when we understood that these five tanks couldn’t be used to store aviation fuel by the time the airport was opened we had to accelerate the Mattala construction work. However that too did not work, as the Mattala aviation fuel tank construction plans were not in line. There was an issue with night work at Mattala because elephants started entering the construction areas and then came the unexpected rain for one month. In addition, installing the fuel hydrant system (fueling to aircrafts) is very sensitive and takes a long time. All these work cannot be completed within a shorter period. That is where the delay was,” claimed Silva.

However, Silva said that the two aviation fuel tanks at the Mattala airport would be ready to store the fuel by September this year and added that aviation fuel is not send to Mattala every day since there is no necessity.

“Once we finish the work by September, we will then draw plans to lay pipelines from Hambantota port to the Mattala airport to take the aviation fuel. Until then we will have to send the fuel to Mattala in road bridges. For the past week we only sent five loads to Mattala,” said Silva.
Asked as to how the CPC is going to recover the money that is paid as transportation cost for the private road bridges, Silva said that there was no way the corporation could sell the aviation fuel for a higher cost as the airlines would then go to the nearest airport to re-fill their aircraft which would be a colossal loss to the country.

“True we are now paying transport charges but still we cannot increase the aviation fuel prices. We have to supply the fuel to the accepted prices. Transporting the aviation fuel to Mattala from Kolonnawa is not a huge loss to the corporation. The difference between fuel transportation from Kolonnawa to Katunayake and Kolonnawa to Mattala is not a big difference as claimed by the trade unionists,” added Silva.

Asked as to how this transportation cost, which cannot be recovered from the airlines, would be settled and whether it would be recovered from the general public by increasing the fuel prices, Silva failed to give a proper answer.
“Since it is not a big loss, we would certainly not put the burden on the general public. All these allegations are made to mislead the masses,” said Silva.

Also, Colombo District UNP Parliamentarian Ravi Karunanyake said that governments’ ‘sins’ have to be borne by the general public.
“All these projects are white elephants. We had to tighten our belts over the past several years because of the unsuccessful Magampura Port (Hambantota port) and the Mattala International Airport. This is complete misuse of capital expenditure. Rs.68 million was spent on an unsuccessful seaport at Magampura and Rs.38 million at an unsuccessful international airport at Mattala. Have we ever benefited from these two white elephant projects? That is why I am saying that these are international jokes. How many ships have come to the Magampura port and how many aircrafts have landed at Mattala airport by now? This is utter waste of poor man’s hard earned money. This is the first time we have ever heard of an international airport without an aviation fuel tank. When I raised this question in parliament, Ministers Dr Sarath Amunugama and Susil Premjayantha accused me for levelling baseless allegations. Civil Aviation Minister Priyankara Jayarayne said that he would give me a return air ticket free of charge to go to Mattala and to see whether what I said was true or not. All these jokers are trying to mislead the people but what I am saying is the truth. If the aviation tanks are in order at Mattala why do the CPC send fuel stocks everyday to Mattala to meet the demand?” said Karunanayake.

He further said that he had come to know that the tank farm in the Magampura seaport had started sinking and added that the fate of the constructed tanks in the port is unknown.

“I challenge the Civil Aviation Minister to take me to the Magampura sea port, the Mattala airport and also to tell whether his ministry conducted an Environmental Impact Assessment (EIA) before the start of the Mattala project. Minister Priyankara Jayaratne would certainly not come forward to take up any of my challenges as he has lied to the people,” said Karunanayake.

Sobitha Hamuduruvo: A voice of sanity A big step forward: Now shun sectarianism

April 20, 2013, 12:00 pm 

This draft, after discussion and amendment, can evolve into the all-party, all-community, multi-class manifesto of a "Rainbow Coalition", to borrow H.L. Seneviratne’s term. Communities (say Tamils), parties (say the JVP), or organisations (civil society and religious) with reservations about blanket endorsement, or unwilling to enter formal electoral alliances, can use it as a template, amend sections, and insert it in their manifestos while retaining the framework. The Tamils can endorse the generic draft, but propose amendments such as devolution, thus retaining their position in the democratic struggle, while keeping up pressure on issues important to their community.

CRP is related to, but not the same as the Single Issue (SI) proposal to abolish the Executive Presidency (EP) that I mooted last year. My proposal, took as its point of departure, the argument: Put together the widest possible alliance on a minimum programme, viz: "A single presidential candidate, on an abolish-EP and restore a parliamentary system, platform. Then a constitutional assembly to write a new constitution; thereafter the SI President will step down". CRP is not inimical to my proposal; it lays down guidelines, to be endorsed by the electorate, as instructions to the envisaged constitutional assembly. No problem I say, except that SI is an indispensable first step to getting there. No new constitution is possible till the Rajapaksas are turfed out. Secondly, the more detail you lay down now, the greater the prospect of someone disagreeing on some triviality and dropping out. This may be why CRP is silent on devolution. Was there no consensus among drafters, or was it tactical? Either, points to the quandary I refer to.

The devil is in the details

Who the SI candidate should be remains unresolved. Ranil is hopeless, but more seriously, he has never committed himself to abolishing EP and his relationship to Mahinda is suspect. Chandrika, with a full opposition behind her, is a potential winner, but cannot be trusted. She lied barefacedly, twice, about abolishing EP. Hence Sobitha remains the trustable and winning candidate of choice. Furthermore, he has the political credentials and religious prestige to persuade Sinhala-Buddhists to accept devolution and fair treatment of the minorities.

You may deem my fear of divisiveness in Lanka’s political culture excessive; but experience is on my side. Doing the work of the future constitutional assembly, nagging and niggling over irksome details, prior to cementing a unified opposition, is a sure-fire way of clouding-out the Rainbow. Let me quote an e-mail I received, in response to my invitation, from a sharp minded person of sombre judgement. The issues are important, but excessive debate on such details is premature.

QUOTE: "(1) In my view the substance and spirit of the Soulbury constitution should be the basis of any new constitution (secularism plus, protection for minorities). (2) I am opposed to the mix of the FPP and PR systems. My preference is for a 100% FPP system. The argument against FPP was that it leads to destabilization of policy. If policies are good, the people will re-elect the government, so there is no room for undue destabilization. Combined with elections every FOUR years (not 6 or even 5), FPP will be a good bulwark against corruption, entrenchment and the arrogance of power. I think FPP, combined with the abolition of the EP, will help the structural dismantlement of the present despicable political culture. (3) I think cabinet size should be 15 maximum and not 25 as the Sobitha proposals state." UNQUOTE.

Yes, the Soulbury Constitution is superior to the 1972 Republican Constitution on secularism and minority protection, and a discussion of the advantages and disadvantages of FPP versus a PR or a mixed system is most relevant. But I am terrified that Lankan politicos, the opposition included, are of sparse cranial capacity and will wrestle to death over such issues instead of expressing a view, and then leaving it to future public consultation. The same goes for the ceiling on cabinet size; given a choice I too would opt for Ali Baba and 15, instead of 25 thieves.

My correspondent, in expressing these views, is too bright to push them to the point of divisiveness. But this may not be the same with everybody. The ageing Vickremabahu Karunaratne has advanced to senility or his attachment to Ranil has matured into an addiction. He has circulated a statement decrying CRP for remaining silent on devolution; this criticism I heartily endorse. Then this one time Vama Samasamajist rants on to condemn it for the: "(F)raudulent ultra-left demand to do away with the Executive Presidency". Phew! Ranil imagines that one day he will occupy the throne; so, as the scriptures say, John the Baptist has arrived before Him to prepare the way.

The need of the hour is to focus every sinew on the primary task of abolishing the Executive Presidency, which is the pedestal of autocracy and the Corporatist State venture. In passant, of course the Rajapaksas will have to be ejected. An outline replacement constitution will facilitate the journey, but let us not bicker over details or be distracted from our objective. To modify Samuel Johnson a little: "There must be progress in every debate; the mind opened by degrees; one truth lead to another; error disentangled; and hints improved to conclusions". Taking the SI challenge forward, and perfecting Hamuduruvo’s CRP document, must proceed in like manner.

The missing elephant

There is a huge hole at the heart of CRP. Not a word about devolution! What does the document say about the national question? It declares that both Tamil and Sinhalese should be declared official languages, and English a "link" language. This misconstrues the role of English; primarily it is a window into modernity and the wider world, more than a link – vide modern India. But in keeping with my principle of not quibbling over details, I only mention this and pass on.

What does the document say about state power and the minorities? Precious little, and a reflexive tilt towards assuaging Sinhala-Buddhist paranoia is evident. I quote:

QUOTE: "The peoples of Sri Lanka who together constitute the People of Sri Lanka have the right to develop their own language, protect their own religion, to develop and promote their culture, to preserve their history and the right to their due share of State power including the right to due representation in institutions of government, without in any way weakening the common Sri Lankan identity. This shall not in any way be construed as authorizing or encouraging any action which would dismember or impair, totally or in part, the territorial integrity or political unity of the Republic". END QUOTE.

The first phrase up to ". . . institutions of government", is fine but plain vanilla; you will find it in any decent constitution. Then the paragraph doubles over, repeating phraseology which is only a shade short of explicitly endorsing a unitary state. The double avowal first says ". . . without weakening the common Sri Lankan identity", and then follows up with a pronouncedly aggressive repetition ("This shall not . . . the Republic"), obviously inserted to reassure the Sinhalese reader that there is not a whiff of the Tiger among the drafters. It would have been entirely different if this sturdy reassurance had been tied to a clear and explicit declaration of devolution of power to minorities. Sans devolution, and sans specific references to the concerns of Muslims, Upcountry Tamils and religious minorities, this section deserves censure for pandering to narrow Sinhala-Buddhist sentiments. The emotional underpinning of the paragraph is hostile to devolution and unsympathetic to the minorities.

It would be good to know how many Tamils and Muslims were among the drafters, and how authentic they were as representatives of their communities. However, there is also a separate NMSJ document which is broader based and includes a call for implementation of LLRC recommendations, which recommendations imply a degree of devolution. Hence there still is scope for discussion and amendment. Let us give the benefit of the doubt to the drafters when they say this is only a first draft.

I plead that I have not violated my principle of not quibbling about details in raising the devolution issue aggressively. In the context of past ethnic and present anti-Muslim tensions, this is not a detail; it is a serious defect in Hamuduruvo’s CRP document. As Sam Johnson says, let us put it right through discourse and development.