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Budget 2022: Government faces decisive litmus test on economy

13 Nov 2021

  • Govt. focuses on Budget’s positive framework; Opposition notes increasing cost of living
  • G-10 governing party leaders to meet tomorrow; focus returns to Yugadanavi deal
  • Secrecy clause in Yugadanavi deal questioned in Parliament, as opposition mounts
  • Prime Minister informs House that new constitution ready by end of the year
  • Weerasekara dismisses claims by Harin and Manusha over Easter Sunday attacks probe
The Government, headed by President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa, last week commenced a decisive journey with the presentation of the Budget proposals for 2022 by Finance Minister Basil Rajapaksa. The budget undoubtedly was presented under unique as well as difficult conditions. However, whether the 2022 Budget will help put the country back on track is yet to be seen. The Opposition has claimed the Budget 2022 was a “damp squib”, while the Government maintains that a good framework has been put in place where wastage has been minimised and several historic actions are being taken in the form of slashing privileges of parliamentarians and expenses at state institutions. It was evident that the Finance Minister had given his fullest in formulating the 2022 Budget. Even the weekly meeting of the Cabinet was not held last Monday (8), since Finance Minister Rajapaksa was yet to finalise observations on the budget proposals. The Cabinet met last Friday (12) morning, prior to the Budget presentation, and approved the proposals. The effort taken by Basil in formulating the Budget 2022 was evident in the physical difficulty he endured while presenting the proposals in the House. Halfway through the speech, Basil requested that the Speaker permit him to continue with the rest of the speech seated, and took his seat before the Speaker could respond. After reading more of the speech while being seated, Basil requested a 10-minute break. The Speaker then announced a 10-minute recess. During the break, the Finance Minister had refreshed himself and returned to the Chamber after having a cup of coffee as well. The 2022 Budget has proposed a total of Rs. 2,284 billion in revenue and grants in the Appropriation Bill for the financial year 2022. The proposal further noted that the total revenue had been estimated at Rs. 2,274 billion, and total expenditure had been estimated as Rs. 3,912 billion.  Meanwhile, the amendment to the Appropriation Act No. 7 of 2020 to increase the borrowing limit was recently approved by the parliamentary Committee on Public Finance, chaired by MP Anura Priyadarshana Yapa. It was decided at the meeting of the Committee on Public Finance, held via video conference, that the borrowing limit, which was Rs. 2,997 billion, would be increased to Rs. 3,397 billion, according to a statement by the Communications Department of Parliament. Ministry of Finance and Treasury Secretary S.R. Attygalle had pointed out that an amendment to the Appropriation Act was needed to increase the borrowing limit due to the economic downturn in the country caused by the Covid-19 situation. He had further pointed out that this was due to the inability to achieve the expected revenue for the year 2021, the increase in supplementary expenditure, and the devaluation of the rupee in the payment of foreign currency loan services. Attygalle had further pointed out that the increase in welfare expenditure during the Covid-19 pandemic led to an increase in supplementary expenditure, with a sum of Rs. 200 billion being approved by Parliament recently for supplementary expenditure. Mounting displeasure The group of 10 (G-10) alliance partners of the governing Sri Lanka Podujana Peramuna (SLPP) is to meet tomorrow (15) at 3 p.m. to discuss the future course of action on the controversial Yugadanavi deal and to analyse the 2022 Budget proposals. The meeting of the G-10 this week is to be hosted by Pivithuru Hela Urumaya (PHU) Leader Energy Minister Udaya Gammanpila. Dissention within the Government continues to grow, with SLPP members and alliance partners continuing to openly criticise the Government’s actions. SLFP General Secretary and State Minister Dayasiri Jayasekara said the people have now been pushed to think twice about their representatives sent to Parliament with a two-thirds majority at the last general election. He noted that the SLFP, together with a group of political parties, were looking at formulating a new economic policy targeting the next two decades. “The present Parliament is the worst that I have experienced in my 17-year parliamentary career. The members don’t know how to speak and have no idea what they are saying even when they do speak. The uppish attitude by some members and the manner in which they address the public show their level of intelligence. Everyone is looking at how soon they can go overseas. The unemployment rate has increased and inflation has increased like never before. Commodity prices keep increasing in a manner that even the people are unable to comprehend. No one can say that they can bring down prices since the issue is with our dollar reserves,” Jayasekara had said. Meanwhile, National Freedom Front (NFF) MP Nimal Piyatissa said that they are unable to face the public as partners of the Government and that all members of the Government would soon be unable to walk the streets freely without being scolded by the public. “The farmer, who should be in the paddy field, is today on the streets protesting. Some members of the Government try to claim that the protesting farmers are affiliated to the JVP (Janatha Vimukthi Peramuna), SJB (Samagi Jana Balawegaya), or UNP (United National Party). But, as an MP representing the Nuwara Eliya District, I can deny this allegation. The situation is such that we are now unable to go before the public, participate at public events, and even get chased when attending official functions. Therefore, we would like to tell the government leaders that none of us will be able to walk the streets soon. The Government is taking unilateral decisions and some have boomeranged on it. If the Government is engaged in a path to disregard the 6.9 million people who voted for it and go against the mandate, we will have to stand with the people and not with the Government,” Piyatissa had said at a function last week in the Nuwara Eliya District. It is in such a backdrop that NFF Leader Minister Wimal Weerawansa had stated that even Prime Minister Rajapaksa was disgruntled with the Government’s conduct. “Not only me, can’t you see that even the Prime Minister is not pleased with the present situation? Did the Premier not reveal his conscience during his speech at the SLPP anniversary celebration? Has he not shown the shortcomings in this path? The Prime Minister has said what he could; there could also be some more he is unable to say in public,” Weerawansa had stated during an interview with the Sinhala press. Another governing party ally, Lanka Sama Samaja Party (LSSP) Leader Prof. Tissa Vitharana, also recently expressed his displeasure at the Government’s present conduct. He told a recent public gathering that if the Government continued to ignore its coalition allies, a group of 11 governing alliance parties will have to take a separate path. “It’s sad to say that the SLPP leadership does not take any notice of the Government’s coalition partners. Since the general elections last August, neither the Prime Minister nor the President have convened a government party leaders’ meeting as should be done. Therefore, leaders of 11 government allies meet separately every two weeks to discuss the issues faced by the country and people. We try to take on the issues on behalf of the people within the Government. If the Government works according to the concerns and issues raised by its partners, we will be able to overcome the present issues,” Prof. Vitharana has said at a recent event in Bandarawela. Amending gazette Meanwhile, the “one country, one law” Presidential Task Force (PTF) chaired by rabble-rousing Ven. Galagodaaththe Gnanasara Thera, which caused much controversy, was subjected to several changes last week. The new gazette issued last week amended the terms of reference of the PTF and added three new members to it. Accordingly, Ramalingam Chakrawarthy Karunakaran, Yogeswari Patgunarajah, and Iyyampillai Dayanandaraja were appointed as new members of the PTF, while Prof. Dayananda Banda and Lecturer Mohamed Inthikab have relinquished their membership from the Force. The new term of reference is as follows: Presenting proposals for formulating a conceptual framework ideally suited for Sri Lanka after making a study of the said concept taking into account the views and opinions held by various parties with regard to the implementation of the concept, “one country, one law”. The gazette was amended following a lengthy discussion between the President and Justice Minister Ali Sabry recently, where Sabry offered to resign from his party membership, parliamentary seat, and portfolio. However, the President declined to accept the resignation, explaining that the PTF was not aimed at formulating laws or slighting the legal reforms process initiated by the Justice Ministry. The President noted that the PTF was expected to present a concept paper on the one country, one law process, which in turn is to be handed over to the Justice Ministry to formulate laws. It was during this conversation that the President first undertook to amend the gazette issued forming the PTF after admitting several shortcomings in the wording of the gazette. It is in this backdrop that Janatha Vimukthi Peramuna (JVP) Leader MP Anura Kumara Dissanayake questioned, in Parliament, President Rajapaksa’s decision to appoint convicted criminal and Bodu Bala Sena (BBS) Secretary General Ven. Gnanasara Thera to lead the one country, one law PTF. Dissanayake expressed suspicion on whether the President was attempting to divide the country by causing racial differences and unrest. “Justice Minister Ali Sabry has openly spoken out against the appointment of Gnanasara Thera. He has also given his resignation. What I want to know is, didn’t the President consult Sabry or the Prime Minister when this decision was made? It seems the Prime Minister found out about this gazette just like I did, in the morning when we woke up and it was in the media. I have a feeling the President is trying to cause a racial conflict,” Dissanayake said. In response to Dissanayake’s question, Minister of Public Security Sarath Weerasekara stated that the President had made such a decision by himself and had looked into all aspects before making such an appointment. However, the Prime Minister said that he knew about gazettes being published before they were actually published. When Dissanayake questioned if the Prime Minister had seen and approved the gazette on the “one country, one law” PTF, the Prime Minister sidestepped the question. Meanwhile, Prime Minister Rajapaksa informed Parliament last week that the committee of experts appointed to draft a new constitution was expected to submit its final draft by the end of this year. The Prime Minister said the process of drafting the new constitution was, at present, in the final stage. Responding to a question raised by Dissanayake, he said the committee was appointed by the Cabinet of Ministers to draft a new constitution as pledged by the Government in its policy statement “Vistas of Prosperity and Splendour”. The Premier said the committee headed by President’s Counsel Romesh de Silva consisted of President’s Counsels Manohara De Silva, Sanjeewa Jayawardena, Naveen Marapana, and Samantha Ratwatte; Prof. Naazima Kamardeen; Dr. A. Sarveswaran; Prof. Wasantha Senevirathne; Abdul Wahid Abdul Salam; and Prof. G.H. Peiris. Yugadanavi controversy continues As for litigation processes facing the Government, the Supreme Court last week took up the petitions filed against the agreement reached between the Finance Ministry and the US-based New Fortress Energy (NFE) on the Yugadanavi Power Plant in Kerawalapitiya. A Supreme Court bench comprising Justices Buwaneka Aluwihare, A.H.M.D. Nawaz, and Mahinda Samayawardena took up the petitions filed by Samagi Jana Balawegaya (SJB) General Secretary Ranjith Madduma Bandara, former JVP parliamentarians Sunil Hadunneththi and Wasantha Samarasinghe, Colombo Archbishop Malcolm Cardinal Ranjith, Ven. Elle Gunawansa Thera, as well as engineers attached to the Ceylon Electricity Board (CEB). The petitions have challenged the agreements entered into between the Government and NFE in relation to the sale of 40% of the shares of Yugadanavi to the US company. The petitioners stated that the framework agreement was signed between the Government and NFE on 7 July 2021 for the disposal of 40% of the total shares held at West Coast Power (Pvt.) Ltd. by Yugadanavi (Pvt.) Ltd. The petitioners had also stated that agreements had been further entered into for the execution of the Terminal Project, which includes a Floating Storage Regasification Unit (FSRU), mooring system and pipelines, and the supply of liquefied natural gas (LNG) to West Coast Power (Pvt.) Ltd.  The petitioners have further stated that to the best of their knowledge, the Share Sales and Purchase Agreement (SSPA) pertaining to the sale of 40% of the shares in West Coast Power (Pvt.) Ltd. and the gas supply agreements had not been placed before the Cabinet of Ministers to date.  The petitioners had added that bundling the contracts for the LNG terminal, construction of pipelines, and LNG supply in a single unsolicited proposal and awarding them to a foreign-based company, without following a transparent procedure, was an enormous threat to Sri Lanka’s energy security. The petitioners had named Prime Minister Rajapaksa, the Cabinet of Ministers, NFE, West Coast Power (Pvt.) Ltd., CEB, the Attorney General (AG), and several others as respondents. However, when the petitions were taken up last Friday, the AG had stated that the Department appeared only for the Ministers of Finance and Power. When questioned by the bench as to why the AG was not appearing for the Cabinet of Ministers, the AG had informed the court that information on representing the Cabinet of Ministers was not conveyed to the AG. Also, Additional Solicitor General Farzana Jameel, appearing for the AG, had sought an order in terms of the Article 132(3) of the Constitution to appoint a bench of five judges or more to hear these petitions, taking into account the national importance of these petitions. The three-judge bench had informed the litigants that the request would be presented to the Chief Justice. The petitions are to be taken up for support on 26 November 2021. Meanwhile, Power Minister Gamini Lokuge last Wednesday (10) informed Parliament that the controversial Yugadanavi deal entered into with NFE will be presented to Parliament this week. “The proposed framework created a regulatory agreement which would allow New Fortress Energy Inc. to develop the gas supply terminals at Kerawalapitiya for five years. This will not create an energy monopoly,” said Lokuge. It was Leader of the House Minister Dinesh Gunawardena who first informed the House that the NFE agreement will be tabled in Parliament. Gunawardena’s comment was in contradiction to a recent statement by CEB Chairman M.M.C. Ferdinando that the agreement could not be publicised due to a confidentiality clause in the agreement. The CEB Chairman recently stated that the content of the agreement cannot be disclosed due to a condition in the agreement precluding its disclosure and that the agreement has not even been presented to the CEB yet. However, Ferdinando stated that AG’s advice is being sought on the matter of publicising the agreement. “The agreement will be tabled after the relevant formalities are carried out,” Gunawardena told Parliament. The Leader of the House made this comment in response to a question raised by UNP MP Ranil Wickremesinghe. “Our party has not come down to a final decision as yet. We would like to see this deal which has been discussed in Cabinet, and then our party can decide on the next step,” Wickremesinghe said. Wickremesinghe yesterday (13) questioned the confidentiality clause in the NFE agreement. He informed Parliament that the Framework Agreement between the Government and NFE was in breach of the ministerial duty of providing information to Parliament. Wickremesinghe had drawn attention to Clause 8 of the deal, which states that for a period of five years, either party shall not, except with the prior written consent of the other party, disclose to any person any information. “The permitted disclosures are in regard to (an) order of a court, arbitral tribunal, or an order, decree, regulation, or rule of any governmental authority. This clause excludes any information being provided to Parliament. It makes a reference to governmental authority, but Parliament is not government; it is the legislature. Therefore, the Minister cannot obtain information under this joint venture agreement for the purpose of disclosing it to Parliament,” Wickremesinghe had added. Controversial statements The spotlight on the Easter Sunday attacks probe continued last week with two SJB MPs making controversial statements on the matter. SJB MPs Harin Fernando and Manusha Nanayakkara made several startling allegations in Parliament last Tuesday (9), where they claimed that Abdul Cader Fathima Hadiya, the wife of terrorist group National Thowheed Jama’ath (NTJ) Leader Mohamed Cassim Mohamed Zahran, alias Zahran Hashim (one of the suicide bombers in the Easter attacks), had said that an intelligence officer had met him several times at their residence. “We don’t know if Zahran’s wife Abdul Cader Fathima Hadiya is still alive or not, but she has said that there were days when Sri Lankan intelligence officers met Zahran at his residence. Zahran’s wife had confirmed this in her statement,” Fernando alleged. “The testimony of Zahran’s wife was captured on video. In that, she says an intelligence officer came to their house. Who was the officer? Why won’t you reveal that? And why do you get flustered when we talk about these things?” Nanayakkara added during his speech. Fernando also made a reference to the capture of two lorries, which were later released, and the involvement of a senior police officer. “On 4 April 2019, two lorries were caught. These lorries were caught on the Gelanigama exit point at the Southern Expressway. What was being transported in these lorries? Who was the senior police officer who called and instructed that the lorries be released? Who was the owner of these lorries? We ask Public Security Minister Rear Admiral (Retd.) Dr. Sarath Weerasekara to at least reveal these things. What’s more, on the day of the Easter attacks, the senior police officer I referred to was at hotel Maalu Maalu in Pasikuda. We ask the Minister to find out and reveal who paid the said officer’s bill and whose voucher he used to stay at the hotel,” he said. Nanayakkara alleged that explosives were found inside those lorries and that a bribe had been accepted in Rs. 5,000 notes. “Weapons and explosives were found in the lorries that were taken into custody that day. When they were released on the orders of a senior police officer, who accepted a bribe in Rs. 5,000 notes? When that senior police officer was staying at Maalu Maalu, who paid his bill? Which position does he occupy in this Government at present? What are his dealings with the Government? What happened to the court cases against him? The security responsibilities of Sri Lanka Cricket have been handed over to a police officer who is still in the police force. It has been entrusted to a private security firm that belongs to a certain individual. Is this person the same as that person? Is he the same person who went to the Dalada Maligawa (Temple of the Tooth Relic) and went to visit the Mahanayakas and requested that police officers not be harassed through implementation of the PCoI (Presidential Commission of Inquiry) report recommendations? We ask these questions knowing the answers so the Government can provide answers.” Dismissing allegations Responding to allegations made by Fernando and Nanayakkara in Parliament, Minister of Public Security Weerasekara said that all allegations posed against him and the State Intelligence Service (SIS) were untrue and did not have backing proof. “The accusations made by Manusha and Harin do not have backing proof. They are baseless and not true. The accusations made by Manusha and Harin stated that the SIS visited the Easter attacks suspects’ house before the attacks took place. They accuse that Hadiya, Hashim’s wife, made a statement which was 22 pages long, whereas in none of the pages does she say that the SIS had visited her prior to the attacks,” Weerasekara told Parliament last Thursday (11). The Minister went on to say that if Nanayakkara and Fernando had proof to support their allegations, they must present the proof openly. Neither MP presented proof of any of their allegations on that occasion. “There is another statement from Hadiya Hashim that is 122 pages long. Even in that statement, not once has she mentioned that the State Intelligence Service had visited her home. To clear his doubts, Harin Fernando can come to the CID (Criminal Investigation Department) and clarify things with these documents. There is another statement made by Hadiya which is 362 pages long, that can be referred to as well,” he stated. Weerasekara also added that legal action can be taken against Fernando and Nanayakkara for spreading false rumours about the Easter attacks investigation amongst the public. “Lakshman Kiriella had gone with some other people to visit the Cardinal in May. They tried to get the Cardinal to speak up and accuse the Government of having close relations with Zahran Hashim and the Thowheed Jama’ath. Whereas, the Cardinal had instead handed over a letter stating the accusations. In response to this, the Terrorist Investigation Division (TID) at the Police said that no conversation or relation had happened between the SIS and the Hashim family. This was confirmed after thorough investigations by the TID. This document will also be tabled in Parliament today,” Weerasekara stated. The Minister also noted that Zahran Hashim’s wife had been questioned by the CID twice before the Easter attacks in 2018 and 2019, and said that during both instances, Hashim’s wife Hadiya and Feroza, who is the wife of the Zion Church bomber, stated that they lived separately from their husbands. “This alone contradicts the statement made by Harin Fernando that the SIS had met with Zahran Hashim and his wife at their residence,” Weerasekara stated, adding that according to CID Director Shani Abeysekera, if the previous Government and investigators had done their job properly, the Easter attacks could have been prevented. “I would like to clearly mention that Harin thinks that he is always right, whereas it is clear now that Harin Fernando is a liar and not true to his word,” remarked Weerasekara. Furthermore, Weerasekara refuted claims of a lorry laden with firearms that Fernando claimed was stopped by the SIS and then released. It was actually live fish which was being transported from the Bandaranaike International Airport, Katunayake to a location in Horana. The lorry was not stopped for long due to the limited supply of oxygen for the fish. “The lorry was checked at several places including the airport and the animal quarantine centre, and nowhere does it mention that the lorry was laden with firearms or any illegal items. The fish were imported by a company in Rajagiriya and all relevant documents were present to prove so. Once again, this proves that Fernando has made false allegations,” said Weerasekara. Weerasekara also revealed that further to an investigation done in 2016 where it was discovered that illegal terrorist activities had been going on and the Yahapalana Government was informed, and Minister Dr. Wijeyadasa Rajapakshe had also mentioned the same in Parliament, the Yahapalana Government, of which Fernando was a member, had not taken any steps to prevent such a foretold attack. In conclusion, Weerasekara stated that the name Zahran Hashim had come up in many instances when racial attacks had taken place in Sri Lanka, whereas no one had done anything to stop the final and largest attack by the terrorists. Ranil’s revelation  Meanwhile, UNP Leader Wickremesinghe last week made several revelations in Parliament pertaining to the Millennium City controversy, the Kadirgamar assassination, and the Easter attacks. “I would like to bring everyone’s attention to the construction of Millennium City. Being the President at that time, Chandrika Bandaranaike had also wanted the development to be done out of Colombo, as safe residences. Despite those instructions, Army General (Lionel) Balagalle went against it and stopped it. During that period, while peace talks were ongoing, a bomb was detonated. Thankfully, no one was severely injured or died, so the peace talks were delayed. I hadn’t spoken about this in the past, but today, I want to speak out,” Wickremesinghe said. He went on to say that information was passed on to “dead sources” who said that the residencies would be rebuilt. Whereas instructions made by former President Chandrika had already been gone against. “Eventually, a story was made that the governing party was involved with Liberation Tigers of Tamil Eelam (LTTE) member Karuna, and that he had an army of over 3,000 people. All allegations were made, but eventually, it was proven that Karuna had no army as such. When those allegations did not work, they created issues which led to the assassination of Kadirgamar,” Wickremesinghe claimed. Furthermore, he stated that a group of people had travelled along with the ISIS terrorist group, and the SIS closely followed them, but no one partook in their activities. “When this group of people returned from ISIS training, I informed former Senior Deputy Inspector General of Police in Sri Lanka and Chief of State Intelligence Service Nilantha Jayawardena to initiate a probe into the returnees, whereas that too was ignored. These, he said, were normal people of no threats. When the information was passed on from India of the Easter attacks, even I was not informed of the steps taken by the SIS to prevent this attack,” claimed Wickremesinghe. Wickremesinghe added that during the last few days before the attacks, the only complaints lodged were by MP Kabir Hashim about the Mawanella Buddhist statue incident. “When we went and suggested to the SIS that there might be a link between the Mawanella statue issue and the Easter attacks, no one said anything. This was not a sudden thing that happened; it was something that was built gradually, and the SIS failed to recognise the signs,” Wickremesinghe stated. Finally, Wickremesinghe told Parliament that answers should be given to MPs Fernando, Nanayakkara, and Lakshman Kiriwella without accusations being made against the previous Government. Rev. Fr. Fernando to give statement Meanwhile, the CID last Monday (8) informed the Supreme Court that there is no move at the moment to arrest Catholic Priest Rev. Fr. Cyril Gamini Fernando. Additional Solicitor General (ASG), President’s Counsel Rohantha Abeysuriya, who appeared for the CID Director, had informed court when the fundamental rights petition filed by Rev. Fernando, seeking an injunction restraining his arrest by the CID or any other police officer, was taken up for hearing last week. ASG Abeysuriya had also informed court that a decision would be taken on the advice of Attorney General Sanjay Rajaratnam after the completion of the CID investigation into the complaint lodged by SIS Director Maj. Gen. Suresh Sallay against Rev. Fernando. President’s Counsel (PC) Rienzie Arsakularatne, appearing for Rev. Fernando, had told the court that his client was ready to appear before the CID and make a statement at an appropriate time. Head of the three-judge bench hearing the said fundamental rights application, Justice Vijith Kumara Malalgoda, had then informed ASG Abeysuriya PC to direct the CID to summon the petitioner (Rev. Fernando) and record a statement by giving the latter sufficient time. During the hearing of the petition, the Catholic clergy and the public staged a silent protest on the main road close to the Supreme Court. Rev. Fernando, who is also the Parish Priest of St. Anne’s Church, Kurana, filed a fundamental rights petition in the Supreme Court on 2 November seeking an order staying the CID and Inspector General of Police (IGP) Chandana D. Wickramaratne and any other police officer from arresting him. He had claimed in the application that the purpose of CID Special Unit’s Officer-In-Charge (OIC) Chief Inspector of Police (CI) Lalitha Dissanayake, who is the first respondent of the said petition, sending a notice requesting him (Fernando) to appear before the CID without disclosing the fact that he was being suspected of having committed serious offences, was not only for the purpose of recording a statement from him, but was rather for the purpose of arresting him when he appeared before the CID. Maj. Gen. Sallay filed a complaint in the CID against Rev. Fernando and others who attended a recent online forum. The SIS Chief requested for an investigation into an allegation made against him during the said forum that the NTJ terrorist group, which was behind the Easter Sunday terror attacks, was supported by the intelligence service, including him (Sallay), who was the then Director of Military Intelligence (DMI). During the said online discussion between the Catholic Church and a group of Sri Lankans living abroad, a presentation was made, which alleged without corroboration that there is credible evidence that Sallay and other intelligence agencies had provided financial and other forms of support to the NTJ group, including Zahran Hashim, prior to 2015. However, SJB MP Fernando had stated that the recent allegation made by Rev. Fernando against Sallay was based on statements made in Parliament by various parliamentarians.


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