Stabilization and Challenges in Sri Lanka

Sri Lanka continues to be in a challenging political, social, and economic situation.

by Afsara Shaheen

Though peace continued to prevail in Sri Lanka through 2023, the politico-economic crises that engulfed the country in 2022, persisted. There was, however, relative improvement in the overall situation.

A huge lightning strike was seen over the Colombo city sky on November 2, 2023, in Colombo, Sri Lanka. (Photo by Thilina Kaluthotage/NurPhoto)

No terrorism-linked fatality was recorded in Sri Lanka in 2023, unlike 2022, when on November 28, Mohamed Badrudeen alias Mohamed Harnas, Easter Sunday terror attack suspect, who was out on bail, was hacked to death by unidentified assailants in Mattakkuliya in Colombo, However, 2023 recorded some terrorism-linked incidents which included:
  • January 25: Three pressure bombs were found at the Sri Lanka Telecom premises in Muttur in Trincomalee District by a worker there, which were later defused by the Special Task Force.
  • February 8: A retired Army Sergeant was arrested after a Police team unearthed a cache of explosives, other accessories and ammunition from the garden of his house in Thihagoda in the Matara District of the Southern Province. The recovery included 3.35 kilograms of C4 high explosives, one bar of explosives weighing 610 grams, two bars of explosives weighing 205 grams each, one bar of explosives weighing 105 grams, 4,482 rounds of ammunition of different types, 10 electronic detonators, 153 non-electronic detonators, a smoke bomb, 32 feet of wire used to detonate explosive devices, and several other items.
  • February 9: The Kandeketiya Police arrested one suspected person from the Maliyadda area in Central Province, in possession of a cache of explosives hidden in a house, which included 51 sticks of gelatine, 20 service threads used for blasts and 15 kilograms of ammonia.
  • February 14: A hand grenade was recovered on the grounds of the Divisional Hospital in the Buttala town of Monaragala District in the Uva Province.

According to the United States (US) Department of State 2021 Country Reports on Terrorism, the Liberation Tigers of Tamil Eelam (LTTE);’s international network of sympathizers and financial supporters is still active, despite the military defeat of the group in 2009, at the hands of the Sri Lankan Government. The report stated that there have been no known attacks in Sri Lanka attributed to the LTTE since 2009, but 13 LTTE supporters, several of whom had planned attacks against US and Israeli diplomatic facilities in India, were arrested in Malaysia in 2014. Other members were arrested in Malaysia and India in 2015, one of whom was accused of exhorting other Sri Lankans to fund and revive the LTTE.

Significantly, on March 12, 2024, a former LTTE cadre was arrested from Matara in the Southern Province, in a joint operation carried out by the Army Intelligence Unit and the Sri Lanka Police Special Branch, while transporting three kilograms of Kerala cannabis from Kilinochchi to Matara by bus. Police stated that the arrestee had been imprisoned for several years before being released. It is to be noted that drug cartels with established foreign linkages continued to operate with impunity in Sri Lanka.

There is a threat to security from other individuals and groups as well. In 2021, 18 organizations and 577 individuals had been blacklisted in the country for financing terrorism under the United Nations Regulation No. 1 of 2012, according to the Defence Ministry. Through an Extraordinary Gazette Notification dated August 1, 2022, the Ministry of Defence removed six organisations and 316 individuals from the 2021 list, but added three new organisations and 55 new individuals to the list. Thus, as on August 1, 2022, at least 15 organizations and 361 individuals were blacklisted in the country. The organisations that were de-listed in the August 1, 2022, Notification included six international Tamil organizations – the Australian Tamil Congress, the Global Tamil Forum, the World Tamil Coordination Committee, the Tamil Eelam People’s Congress, the Canadian Tamil Congress and the British Tamil Forum. Of the 15 existing groups in the list, five are Islamist groups, including the National Thowheed Jama’ath (NTJ), Jama’athe Milla’ athe Ibrahim, Willayath As Seylani, Darul Adhar alias Jamiul Adhar Mosque, Sri Lanka Islamic Student Movement and Save the Pearls.

There was some relief on the economic front. Inflation has come down from a peak of 69.8 percent in September 2022 to 5.9 percent in February 2024. Despite a 12.4 per cent Gross Domestic Product (GDP) contraction in Quarter 4 of 2022 and six consecutive quarters of negative growth in 2022 and 2023 (first two quarters), the nation rebounded with a 1.6 per cent growth rate in Quarter 3 and 4.5 per cent growth in Quarter 4 of 2023. The Sri Lankan Rupee traded at 377 against the USD in May 2022, but recovered significantly, at 309 in March 2024. The tourism industry, one of Sri Lanka’s key economic pillars, has grown significantly. Arrivals of foreign tourists increased from 194,495 in 2021 – the middle of the COVID pandemic – to 1,487,303 in 2023.

Despite significant recovery, however, the situation remained worrisome. The recent economic forecasts for Sri Lanka released by the Asian Development Bank in September 2023 noted,

Sri Lanka needs to implement structural benchmarks and meet quantitative performance criteria under the International Monetary Fund program and ensure the timely completion of debt restructuring. Adverse weather could have a prolonged impact on agriculture. Also, outward labour migration, particularly by highly skilled workers, may constrain recovery.

Meanwhile, according to the Sri Lankan Constitution, the Country must hold its presidential election in September/October 2024 and parliamentary elections before August 2025. However, given the present scenario, there is a doubt that elections will be held on time. Indeed, citing financial limitations, local government elections that were originally slated for March 9, 2023, were postponed, almost bringing the Election Commission and the Government to the verge of an institutional crisis. The Government failed to provide the funds required to hold the polls, so the elections were postponed indefinitely, even though the Election Commission had rescheduled the date to April 25, 2023.

Elections could result in a dramatic shift in Sri Lanka’s political landscape. Led by the Marxist party Janatha Vimukthi Peramuna (JVP), the National People’s Power (NPP) alliance is predicted to be the frontrunner in the elections. Anura Kumara Dissanayake, the leader of the JVP, is poised to dominate parliamentary elections and could challenge President Ranil Wickremesinghe seriously in the presidential contest. The NPP opposes privatization of all state-owned businesses, especially those that are losing money, and its beliefs and practices go counter to ongoing reforms.

Another political coalition that is set to be well-represented in polls is the Samagi Jana Balavegaya (SJB), the country’s principal opposition party. Once an ally of Wickremesinghe, its leader, Sajith Premadasa, has turned into a vociferous critic of the President’s administration. Its leader, Premadasa is more popular than Wickremesinghe, even though both of them have comparable plans for economic recovery and the government.

In a worrying development, Sivagnanam Shritharan, an ardent supporter of the LTTE movement – a position he has often reiterated publicly – was elected leader of the largest Tamil political party, Ilankai Tamil Arasu Kachchi (ITAK) in January 2024. After his election Shritharan said that their journey should begin from the graves of the Eelam national liberation fighters. This indicates a major change in the strategies of Tamil parties. Minority parties had previously tried to negotiate concessions from major parties on matters such as power devolution and the return of lands now held by the military to their original owners in the Northern Province of the country. The possibility of a more fractious approach appears likely under Shritharan’s leadership.

Sri Lanka continues to be in a challenging political, social, and economic situation. The economic crisis of 2022 serves as an example of the indivisibility of human rights and the ways in which impunity, corruption, and the erosion of democratic institutions and the rule of law have all contributed to the current state of affairs. Sri Lanka must address the enduring effects of the protracted armed conflict that ended in 2009, as well as the severe longer-term deficiencies in governance and accountability, in order to embark on a path to recovery and sustainable development.

Afsara Shaheen is a Research Assistant at the Institute for Conflict Management in New Delhi, India