Sunday Times 2
Sri Lanka centrepoint – partnership for growth
View(s):Sri Lanka is presently at a critical juncture in the economic front. The Government of Maithripala Sirisena and Ranil Wickremesinghe have been in office for a period of 16 months with several reforms on the democratic front to their credit. Beyond that the challenges have surmounted on driving an economy that needs infusion of capital and sustainable development. The crisis in Europe, election in the United States, and fluctuation of fuel prises in the OPEC may contribute to an unsettled and turbulent period in the landscape surrounding us. “Where can and where should” Sri Lanka turn to? This remains an obvious question.
Prime Minister Ranil Wickremesinghe meeting Indian Prime Minister Narendra Modi in New Delhi last year during a visit aimed at promoting bilateral ties
It is here I would like to quote a relevant statement by George Soros – “Sri Lanka will have to ‘swim upstream’ as the external global environment becomes more hostile and funds flow out of developing countries and China’s economy becomes unstable.”
Since the defeat of terrorism in 2009, Sri Lanka’s progressive development can be viewed undoubtedly with a great sense of satisfaction and pride. The unfortunate terrorist attacks in Europe, along with attacks at the core of the European Union in Brussels, bring to light the “terror in terrorism” that was once a normalcy in Sri Lanka. We must re-visit the negative propaganda that was mounted against Sri Lanka’s efforts in countering terrorism. It is now time for the awakening of the moral responsibility of the then fierce advocates, who set the world stage against Sri Lanka. President Sirisena has gone on record maintaining a stance of protecting the sovereignty and territorial integrity of Sri Lanka against any influence by the international community.
The Ceasefire Agreement of which I myself remain a fierce critic due to the many flaws associated with it, however still paved the way for one success we achieved in the face of canvassing international acceptance for our efforts.
There is a reason why the Mahinda Rajapaksa administration met with the LTTE in 2006 in Geneva at the peace talks with collaborative recognition of the co-chairs, which included USA, UK, the EU, Norway, India and Japan which were appointed as part of the team to strengthen the process towards peace. The achievement of the adherence and acceptance of the international instruments in view of the global perception remain a significant remnant of the Rajapaksa administration.
President Rajapaksa in his inaugural address at the All party Conference on July 11, 2006 made it known that he is committed to a “home grown solution” to the national issue. At the same time, Sri Lanka continuously maintained, the full implementation of the 13th Amendment of the constitution, and many a times President Rajapaksa maintained that he would go beyond the 13th Amendment, called the 13 PLUS. However this still remains a contentious issue in the political arena.
Twenty million of Sri Lanka’s population seeks and continue to seek an initiative from the government with a departure from the past. Sri Lanka’s need to substantiate its achievements in the political and the domestic front and the need to be a part of global and regional affiliations is vital for both trade and investment. In this scenario it cannot be stressed more the essential nature of Sri Lanka’s need to become a Centre Point for far East and South Asian connectivity extending to the Middle East and beyond to West Asia.
Sri Lanka placed in the Indian Ocean is advantageously located in close proximity to India. Simply, Sri Lanka needs to grow as the centrepoint in the SAARC and that of East Asia and Middle East.
As much as markets can bring you increasing trade, they must have reciprocity as the corner stone of good foreign relations. Now we are at a crucial time in Sri Lanka with the world economies and Europe being struck by recession and terrorism. The criticality of the need to have prudent, firm and visionary decisions to be taken could not be more apparent at this juncture. Sri Lanka should pitch her position with solid fundamentals in place. The political aspect of our fundamentals is now being recognised, having defeated terrorism, and enjoying the state of a “free country”. Sadly it is not many in the world that could claim this to be so in their respective countries. Europe is experiencing what we experienced of terrorism and the refugee crisis. We now have a platform to reach out, with a strategy, of our democracy being advocates for good governance.
In this backdrop where would Sri Lanka turn to for sustainable growth and to overcome the immediate economic challenges? The new government faces a deteriorating economy with no signs of stimulation to register stability and resilience in the economy. Therefore pragmatic policies need to be adopted without allowing dogmatism to overcome the immediate economic downturn.
Prime Minister Ranil Wickremesinghe’s recent visit to China significantly highlight a more realistic approach being adopted by the government. However even delayed realisation of the need to look for economic ties is both a wise and a prudent step above all in achieving a pragmatic development. Sino-Lanka ties are of a special nature dating back to the Rubber-Rice pact of 1952 and steadfast recognition of One China Policy which enabled consecutive governments to raise and stabilise our ties with China. During our time of battle against LTTE terrorism, China reciprocated well. In the post conflict period China‘s support for Sri Lanka’s sovereignty and territorial integrity in the international arena was of immense value to Sri Lanka. China’s contribution in Sri Lanka’s development agenda saw phenomenal success and manifested in a land mark mile stone. However remarks about blame for borrowing and sinking the country with debt by the Rajapaksa regime is a topic that will continue to be of debate.
The Indian factor is not necessarily a matter of compulsion. The regional super power status, and that of the Indian trajectory, should never be viewed as an intimidation towards Sri Lanka’s realisation of a pragmatic and realistic relationship, stemming from the strengths of intertwining history and cooperation of many millennia.
India’s growth like many countries in Asia is the advent of “free economy”. The administrations of Prime Minister Narasimha Rao, Dr. Manmohan Singh to Prime Minister Modi, were all fierce advocates of the “free economy”. Looking back in history, Sri Lanka was on its way to achieving glory when President Jayewardene in 1977 converted a “close economy” to a “free economy”. Thereby today Sri Lanka’s major workforce is private sector associated and has a higher quality life and a greater degree of income. However the grips of terrorism hindered the once foreseen economic stability of Sri Lanka. Hence time for greater economic initiatives, hand in hand with a global vision has arrived.
US ties with India have grown in strength, including the pursuit of some of the historical bilateral treaties, by successive US Governments. It was encouraging, when Dr. Manmohan Singh in 2006, during my engagement, was emphatic, on the need for the India-Sri Lanka relationship, to emerge new focus, in the economic drive.
On January 31, 2007, during my appointment with the former Prime Minister Dr. Manmohan Singh in New Delhi, the CEPA was discussed. The media statement issued at this meeting may be quoted. “The President of Sri Lanka, Mr. Bogollagama said, has gone on record concerning his preference for the conclusion of the CEPA by the middle of 2007. The Indian leaders for their part, reaffirmed the commitment of their country, to an early conclusion of the CEPA process, in a manner that would be mutually beneficial to both sides.”
By 2008 there was a design departure on the course of the CEPA trajectory. It is relevant to quote the news appearing on AMIST dated 28 July 2008. “Sri Lanka Foreign Minister Rohitha Bogollagama wrote to external affairs Minister Pranab Mukherjee a few days ago, that Colombo needed to bring on board, additional stakeholders before the Comprehensive Economic Partnership Agreement or CEPA is signed
The Agreement had been due to be signed on 1st August, on the sidelines of the South Asian Association for Regional Corporation, or SAARC, summit which Prime Minister Manmohan Singh is to attend in the Sri Lankan Capital Colombo.
CEPA’s signing would have been the icing on the cake for the economist-Prime Minister who is travelling to SAARC after being strengthened by the trust vote in Parliament last week over the India-US civilian nuclear deal. Singh has often stated that the economic integration of South Asia can heal its political problems .
Diplomats pointed out that a breakaway faction of the Marxist-nationalist Janatha Vimukthi Peramuna (JVP), which is supporting Rajapaksa’s government, had said Sri Lanka should not sign CEPA because it benefits India more than Sri Lanka.
Ranil Wickremesinghe, leader of the opposition United National Party who has been pushing for better ties with India, is in favour of CEPA.
CEPA negotiations took 12 rounds and three years to complete, with India stalling talks for the first year and a half because it did not want to open the domestic market to vanaspati, or hydrogenated vegetable oil, pepper exports from Sri Lanka”
In fact these objections were repeated by Tilvin Silva, the General Secretary of the JVP at a recent meeting and reported in the Lankadeepa as recently as April 21, 2016. Hence it could not be more obvious, that a section of the political makeup of Sri Lanka and associated interest groups still remain hostile to the proposed ETCA, which they term a similar agreement like the CEPA.
Therefore it is important to understand the purpose underlining the ETCA and the benefits that grow from it. Universally the States have both the discretion and the right to correct any tangible negatives associated with such agreements. The United Kingdom is currently seeking a referendum on the continuity in the EU. Therefore countries can always exercise prudent decisions at any given time.
Having said that, it is important to understand where Sri Lanka’s economic horizon lies. Is it to be pursued in isolation or in collaboration with stronger partners? Where are the opportunities for Sri Lankan produce to be marketed and capital inflow to be generated? Is proximity a critical requirement in the pursuit of economic gains? Are doors open for Sri Lanka in other geographical locations as much as in the land of her neighbour? The familiarity, the similarity, and historical cultural bondage are all factors for a solid relationship.
Has the government of Sri Lanka failed to explain the value of a structured economic platform for growth with India through mutual cooperation? Are we lacking a government spokespersons to articulate the ETCA framework with clarity? Rhetorical discussions are an integral aspect of the Sri Lankan culture but succumbing to such pressures should not amount in any manner to depart from their pursuit.
Ten years ago on December 22, 2006, Sri Lanka entered into a Joint Venture with India, on a 500 mega watt Power Generation Plant in Sampur. This is considered to be the single largest Joint Venture between India and Sri Lanka. India’s presence in the Sri Lankan economy always included a tradition of great influence, both on the imports and service sector, including that of transport, and on many occasions assistance at times of need including natural disasters. It is apparent that India has significantly established a lead in banking, plantations, pharmaceuticals, and the motor trade. On tourism, India has registered the status of the highest tourist arrivals country to Sri Lanka. Rehabilitation work in the North, and the post conflict development agenda, has been well nurtured and financed by India. Railway movement is now reaching the furthest point in the North after a lapse of 30 years.
People expected the current government led by President Maithripala Sririsena and the Prime Minister Ranil Wickremesinghe to register, a marked improvement, in the economic conditions of her people. They wanted a regime surpassing and surmounting any draw backs and negatives attributed to the regime of the Rajapaksa’s. Speedy development, with transparency, free of corruption, was aspired by the people. In Sri Lanka, the people gave the new government the mandate, to make things better, and do things better. How do we achieve these larger objectives? It is definitely not by attitudes governed by lethargy and outdated policies. It will only be achieved through well formulated strong intervention and strategic foreign relations.
Sri Lanka needs capital, technology, markets and skills. We cannot be confined to traditional conservative methodology in world –play. Aggressive internationally established approaches with beneficial results, is mandatory to be pursued.
It was most unfortunate that in the late 60’s, when invited to be one of the founding members of the ASEAN, Sri Lanka missed out on this wonderful opportunity. Fifty years since ASEAN has grown to be a resilient and a stable economic bloc in Asia.
India is currently registering the fastest growth in the economic front. It’s imperative that we do not allow history to repeat itself where Sri Lanka misses out on the opportunity for greater collaboration and engagements. India’s ability to design and pursue areas of technology, education, science and new dimensions in food agriculture to Information technology and rocket/nuclear science are major vistas to be viewed by Sri Lanka’s new platform.
India has already ascended the world stage including the future composition in the UN Security Council. It is a country whose hegemony in the region has been historical as much as contemporary.
Today as the government of Sri Lanka is formulating ETCA, the Prime Minister of Sri Lanka Ranil Wickremesinghe has gone on record to state that there will be a thorough discussion before making any significant decisions. Leadership drives with command over the destiny of the substance and a good agreement should be both beneficial and should stand the test of time. Sri Lanka’s structure should be equally conditioned to look at the vistas beyond her parochial thinking. Our nation has still not explored the resources at sea surrounding Sri Lanka painstaking as it is to accept nor have we taken advantage of our strategic location. We have still failed to become a Singapore in East Asia or a Dubai in Middle East and West Asia.
Our national carrier is ailing, the energy sector is failing with regular power cuts and the fact that our transport sector is primitive are just few major areas that display the lack of development. The enormous burden this has registered on the government coffers cannot be wiped out nor can be rectified without an enormous capital investment. Without having to cite other areas including the need for food security in Sri Lanka, free education and health and the debt servicing responsibilities of the government a new direction is now needed by the administration of Maithripala Sirisena and Ranil Wickremesinghe. The experiment of a national government failing to tackle the current crisis will be a disaster in terms of any further similar experiments to be tested in the political landscape in Sri Lanka.
Therefore there could not be a more vital time to open up new avenues for growth through regional and bilateral co-operation. Sri Lanka’s global relationships must become stronger whilst the Indo–Lanka relationship must be nurtured for a blossoming partnership for economic growth.
Hence it is time for Sri Lankan to be the next centre point in our region.
(The writer is a former foreign minister of Sri Lanka)