Print This Post
13 November 2024, Gateway House

Sri Lanka’s leadership trio

Since their swearing-in in September this year, President Anura Kumara Dissanayake’s cabinet of three has been campaigning for long-term economic and political reform. To make these major changes and put Sri Lanka back on the growth path, they will now need to win a majority in the Parliamentary elections to be held on November 14.

post image

On November 14, Sri Lanka’s new President Anura Kumara Dissanayake will once again face the electorate when the country holds Parliamentary elections.  Dissanayake’s National Peoples Movement (NPP) party will need to win a majority of the vote if he is to make the major changes he seeks and put Sri Lanka back on the growth path. Among other parties contesting are Samagi Jana Balawegaya (SJB), led by Sajith Premadasa and the New Democratic Front (NDF) headed by former President Ranil Wickremesinghe.

Since his swearing-in as President on September 24, Dissanayake’s cabinet has focused on political stability and economic progress. Dissanayake has kept the four key portfolios with himself: Defence, Finance, energy, agriculture. By retaining these critical ministries, he prioritises national security, continuity of the IMF program for achieving economic stability, guaranteeing an uninterrupted supply of fuel and electricity, and securing food supplies to address the public’s primary needs.

For the rest, he has formed an interim Cabinet consisting of two trusted members of the NPP: Harini Amarasuriya and Vijitha Herath.

Harini Amarasuriya, 54, has been appointed Prime Minister, becoming the third woman to hold this office in Sri Lanka. She has served as an NPP Member of Parliament and Deputy Secretary of her party since 2020. In Parliament, she has raised concerns from the opposition on issues such as reconciliation, social inclusion, and advocating for a united political system that aims to dismantle ethnic and religious divisions in politics. Additionally, she has emphasized an increase in government funding for education from 2% to 6% of GDP. Amarasuriya’s strong reputation and academic credentials make her an excellent candidate for the prime ministership. Her appointment could bolster public trust, strengthen the NPP’s strategy, and potentially attract more support and votes for the party.

Currently, she holds multiple portfolios, including Justice and Home Affairs, Education, Women, Child and Youth Affairs, Sports, Trade and Industry, and Health. She has used her academic background -n a PhD in anthropology – to focus on research and policy work addressing social justice, equitable access to education, and youth empowerment in Sri Lanka. Though she was initially limited in engaging directly with community issues in her constituency, the role of Prime Minister now provides her with an opportunity to bring her vision into practice.

Vijitha Herath, also an NPP member of parliament since 2000, is one of Dissanayake’s closest confidants. He also holds multiple portfolios including the all-important Foreign Affairs and Public Security, plus Cultural Affairs, Transport, Environment, Plantation and Community Infrastructure, and Rural and Urban Development.  As foreign minister, he says his primary goal is to enhance economic diplomacy, strengthen regional and global relationship and address debt and financial reforms for equitable economic development and sustainable international relationship.  The NPP government aims to keep Sri Lanka aligned with the principles of the Non-Aligned Movement, adopting a balanced approach, especially in its relations with China, India, and the U.S.

The NPP leader has openly stated that Sri Lanka should not be used as a base in any way that threatens India’s security. He understands India’s Neighbourhood First policy and has appreciated India being the first to support Sri Lanka during its severe economic crisis by extending a $4 billion credit line. In the past, the NPP has raised concerns about Sri Lanka’s reliance on Chinese loans and infrastructure projects, advocating for greater transparency, fair terms, and prioritizing the country’s long-term interests. Herath may seek to renegotiate or review existing agreements with China to ensure that Sri Lanka’s financial and developmental goals are met.

One of his first acts as foreign minister on October 15, was to have Sri Lanka officially made an application for membership in BRICS and the New Development Bank. Joining BRICS will strengthen Sri Lanka’s ties with key regional partners in the Global South – especially India and China – creating opportunities for trade agreements, infrastructure projects, and technological partnerships. Using a BRICS currency for trade with these countries could reduce reliance on the US dollar and increase foreign reserves, giving Sri Lanka a more diversified foreign exchange base to better manage exchange rate crises.

Together, the three top ministers have a huge job. They must bring Sri Lanka out of its economic crisis and ensure the continuation of the IMF’s Extended Fund Facility (EFF) program.  The challenge is to increase government revenue without compromising fiscal discipline– a job made difficult by election promises to raise the income tax threshold from Rs 1.2 million to Rs 2.4 million and to lower the progressive tax rate from 30% to 24%. The goal is to increase individuals’ disposable income, support purchasing power, and reduce the tax burden on investors and businesses. Poverty remains high at 24% of the population, a stark rise from the 3.2% recorded in 2019. Additionally, capital and investment inflows have dropped from 46% of GDP in 2017 to 18.2% in 2023, largely due to weakened investment conditions, political instability, and economic uncertainty.

The trio are campaigning vigorously on a long-term, joint blueprint for economic and political reform, to ensure Sri Lanka retain its place as a strong, export-driven economy by attracting more foreign direct investment and to draft a new constitution focused on equality, democracy, and good governance.

Kamalaharan Shanmugam is Research Assistant, Gateway House. 

This article was exclusively written for Gateway House: Indian Council on Global Relations. You can read more exclusive content here.

Support our work here.

For permission to republish, please contact outreach@gatewayhouse.in  

©Copyright 2024 Gateway House: Indian Council on Global Relations. All rights reserved. Any unauthorised copying or reproduction is strictly prohibited. 

References

Economynext. (2024, August 26). Sri Lanka’s NPP plans to raise tax-free threshold to Rs 200K monthly income. Retrieved from economynext.com: https://economynext.com/sri-lankas-npp-plans-to-raise-tax-free-threshold-to-rs-200k-monthly-income-178110/

Government, S. L. (2024). Office of the Cabinet of Ministers, Sri Lanka. Colombo: Office of the Cabinet Ministers of Sri Lanka.

Parliament.lk. (2024, September). Members of Parliament. Retrieved from Parliament.lk: https://www.parliament.lk/en/members-of-parliament/directory-of-members/viewMember/3449

The Hindu Bureau. (2024, September 23). Sri Lanka elections result highlights: Anura Kumara Dissanayake elected President. Retrieved from The Hindu: https://www.thehindu.com/news/international/sri-lanka-presidential-elections-result-live-updates-september-22/article68670009.ece

The Tamil Guardian. (2024, September 27). Who is Sri Lanka’s foreign minister Vijitha Herath? Retrieved from www.Theguardian.lk: https://www.tamilguardian.com/content/who-sri-lankas-foreign-minister-vijitha-herath

Yusha, Z. (2024, October 15). Sri Lanka’s application to join BRICS demonstrates organization’s appeal for developing countries. Retrieved from Global Times: https://www.globaltimes.cn/page/202410/1321264.shtml

TAGGED UNDER: , , , , ,