At the crack of dawn tomorrow, Sri Lanka will step into a new calendar year. What was predicted to be a year of recovery and growth by some seems less bright, following the thrashing by Ditwah and the unprecedented damage. The debate about how much blame should be assigned to whom regarding Ditwah, its prediction, and disaster preparedness remains an ongoing spectacle. The economic burden for rebuilding has been estimated by the World Bank and UN agencies to be over US$ 4 billion. Regardless of who is responsible and whether risk reduction and disaster management were implemented efficiently, one thing remains clear and undisputed: Sri Lanka remains deeply vulnerable to shocks, both man-made and natural.

According to the World Bank, an estimated US$ 4.1 billion in direct physical damage to buildings and contents, agriculture and critical infrastructure. The damage is equivalent to about 4% of the island’s GDP. The cyclone, one of the most destructive in Sri Lanka’s recent history, severely affected close to 2 million citizens and 500,000 families across all 25 districts, disrupting livelihoods, essential services, and the broader economy. According to the report, the Central province was the hardest hit, with damages in the Kandy district estimated at $ 689 million, primarily caused by flooding and to a lesser extent by landslides. Infrastructure, including roads, bridges, railways and water supply networks, accounts for the largest share of damage, at an estimated $ 1.735 billion (42% of total damages), disrupting connectivity and access to markets and services. Residential buildings and contents have been heavily affected, with damages totalling an estimated $ 985 million. The widespread impacts on homes highlight the need to consider building locations, flood control structures and designs that are resilient to high winds and flooding. It doesn’t end there. Sri Lanka had just managed to emerge from a food insecurity crisis when the cyclone hit.

Agriculture suffered an estimated $ 814 million in damage according to the WB, including to paddy and vegetable crops, subsistence farming, maize, livestock and agriculture infrastructure, as well as damage to inland fishing, posing serious risks to food security and rural livelihoods in already vulnerable communities. Also, non-residential buildings (including contents), such as schools, health facilities, businesses, and large industrial facilities and factories located along major rivers and creeks, were also heavily impacted, accounting for $562 million in estimated damages, interrupting education, healthcare delivery, and local economic activity in cyclone-affected areas.

With Sri Lanka inching closer to the 2028 timeline for repayment of our external debt, the colossal damage bill from Ditwah and rebuilding plans have placed a significant obstacle to sticking to the plan and timelines, which were fixed with the IMF. Domestically, Sri Lanka is in store for some serious self-reflection as geo-environmental realities about the island’s topography and our unplanned community building in the mountainous regions of the island become evident. Sri Lanka may have to take some bitter policy pills, which will undoubtedly cause some governance challenges in the coming years.

While dealing with the impact of Ditwah, the structural reforms, an increased requirement for fiscal discipline, popularity at home shifting to the back foot, the Government will also have to manage the international arena. By most accounts, the Indian Ocean’s strategic importance will only intensify in 2026, driven by escalating competition among major powers: primarily China, India, and the United States. China’s expanding maritime presence and infrastructure investments challenge traditional balances, while India asserts regional leadership through initiatives like SAGAR and multilateral partnerships. The growing US-China rivalry is set to make the region a central arena for global power dynamics, with small island nations like ours with a proximity to vital sea lanes becoming increasingly impacted by the power struggles. If Sri Lanka pushes its national interests effectively, the turbulent period can also be beneficial to the island nation. Security, trade, and energy routes remain focal points, and multilateral cooperation will be crucial to maintaining stability. It remains to be seen if the current Government has the tact and fortitude to navigate such an environment effectively.

Regardless of what's in store, the Sri Lankan public must remain diligent and push the Government to improve the transparency and accountability they promised to introduce. The honeymoon period is over, and if the citizenry leaves the ‘business of governance’ to the polity, as we have done in the decades before, we may be repeating past mistakes. 2026 will require us all to do our civic duty to help rebuild, forge a stronger and more resilient Nation, and to be watchful of the State and Polity, to ensure they don’t change our trajectory to a downward spiral. We wish our readers all the best for the year 2026. Be kind to each other.