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Indo-Lanka relations: SL political stability important to India says Austin Fernando

26 Jun 2022

By Asiri Fernando  Crisis-hit Sri Lanka needs to maintain good relations with India, while ensuring local political instability does not affect the neighbouring giant, former Sri Lankan High Commissioner to New Delhi and former Eastern Province Governor Austin Fernando said last week. Sri Lanka can benefit from India’s influence with multilateral agencies and the West to help aid the country’s economic recovery efforts. However, transparency and consistency on policies and investments are needed, Fernando said, adding that to sustain much-needed debt restructuring, Sri Lanka had to deal with all creditors on similar terms – a position China is not keen on. In an interview with The Sunday Morning, the former diplomat and Secretary to the President and Ministry of Defence, said that Sri Lanka needed to have a balanced approach to foreign policy and offer investment security when navigating the recovery of the current crisis. Following are excerpts of the interview: How important is it for Sri Lanka to foster sound Indo-Lanka relations during the economic crisis? Sri Lanka is in deep trouble. We have to come out of this crisis by using all our might and contacts. Therefore, we have to consider India as one of our largest supporters. Sri Lanka and India have had relations for centuries and more. Therefore, they have a good attitude towards Sri Lanka. Of course, this has been blurred on and off, like when the case of the Indian food drop in 1987 happened and the training of LTTE cadres took place with the help of the Indian Research and Analysis Wing (RAW), which were not expected by us. It is not a complaint that we make; it is on record by the Indians. Such support to terrorists worsened our situation. Then at the United Nations Human Rights Commission (UNHRC) it voted against us and later stayed away – abstained from voting – which we don’t expect from a friend. There have been some aberrations of that nature. Still, we have a good relationship with India. The Suwa Seriya ambulance project and housing programmes in the north and the east are projects that help the common man in Sri Lanka. Such projects have been well received. There have also been big investments, for example a cultural centre in Jaffna and some of the religious centres in the hill country. India’s offer of investment in the Western Terminal of Colombo Port and in Mannar – Pooneryn for renewable energy. These are great inputs from India. However, the latter inputs have been questioned for their transparency. Where the particular company, Adani, which is very close to Indian Prime Minister Modi is concerned, a question has been raised whether Sri Lanka had any stake in getting involved in the selection process, so there are issues which need to be addressed on investment. Mind you, we need investment. We have had a longstanding relationship with India and that relationship has helped us, so we must continue close relations with India. Do you think India could play a role in political stability in Sri Lanka, which is critical for economic recovery? Yes, it can. I think political stability in Sri Lanka is not only good for us but for India too. If you look at the geopolitics of India, it has concerns on the north, east, and west borders. On the northern borders, it has issues with China, and recently it had some tension there. India has some issues with Bhutan, like the pricing of electricity. In Nepal, there is a dispute about Indian encroachment regarding a road being built and in 2019 the Nepali Prime Minister said “I’ll fight to get this land back”. There are border issues with Bangladesh and Assam. I don’t think we need to elaborate on Pakistan. There have been verbal exchanges between Indian and Bangladeshi officials. Small as they may be, these incidents point to a range of concerns for India and indicate that there are some blurred relations along the Indian borders. Therefore, the political stability of Sri Lanka, which is on its southern coast, needs to be maintained. Imagine if the north of Sri Lanka were to become unstable? It is a concern for them. So India must be good with Sri Lanka and vice versa. We also have concerns about the risk of the LTTE reorganising with assistance from South India. We have a problem with the fishermen’s issue, as does India. As a major power, India has close relations with the West, Japan, and Australia and can influence them about the support Sri Lanka can get. This is also helpful to Sri Lanka. Indian Finance Minister Nirmala Sitharaman is influential and can help us with the IMF, World Bank (WB) and other multilateral institutes. A high-level Indian Government delegation visited Colombo last week. What do you think was on the table for discussion?  The Indian Foreign Secretary has experience in handling tricky diplomatic relations, so his visit to Colombo may have been to address some sensitive issues that the Indians may have with Sri Lanka. I trust India will help rescue Sri Lanka from this crisis and that the meetings would be productive. The visit could also be because of certain questions raised about some projects. Our people rightly look at investment projects, analyse, and ask some important questions. This may be hurting some segments in India. As for the recent concern about Adani, the former CEB Chairman M.M.C. Ferdinando said something that more or less gave the impression that the Indian Government, inclusive of Prime Minister Modi, had influenced Sri Lanka regarding a renewable energy project. That type of influence amounts to threatening. Ferdinando is on record, so this must also be a serious concern for India. There may be other issues; we don’t know what agreements were made by Basil Rajapaksa before he left his portfolio. Issues regarding the fishermen and the International Maritime Boundary Line may also be up for discussion. Unlike Sri Lankan fishermen, the Indian trawlers that poach in our waters belong to big businessmen who have a strong lobby pressurising the Indian Government. These businessmen are powerful and matter to the Indian politicians. There is a big lobby group unseen by us who are powerful and pressure the Indian Government on this issue. India has been quick to help Sri Lanka amidst the ongoing economic crisis. Do you think India can play a greater role in organising international assistance from Sri Lanka via a donor/assistance conference? I don’t think there is a history of India doing such conferences. It is the multilaterals who normally do such conferences. In 1987, our then Finance Minister Ronnie de Mel managed to get the World Bank to summon a meeting of that nature in Paris. I attended the conference and nearly 25-30 key nations attended. India also has limitations on how much it can help us. Yes, India has close to $ 600 billion in reserves, but there are many issues in India, including poverty, which India needs to address. If India moves to give Sri Lanka more, the Indian public may question their Government as to why taxpayer funds are being spent here. Sri Lanka managed to raise $ 486 million in pledges from the WB, IMF, the US, Japan, the UK, Italy, and India, among others. We raised funds; their consultants discussed Sri Lanka and prioritised projects and when the job was done, they reimbursed us what was promised. This effort was coordinated by the World Bank. In 2003, when Ranil Wickremesinghe was PM, Sri Lanka had a donor conference in Tokyo. This was after several rounds of talks with the LTTE; the conflict had gone on for two decades. The international community was keen to help Sri Lanka but had some conditions. They pledged a total of $ 4.5 billion if we met these terms. But it didn’t materialise. Chandrika Kumaratunga was the President and the terms of the Interim Self-Governing Authority (ISGA) were a stumbling block. Imagine if we got that $ 4.5 billion in 2003? What a difference it would have made for the country; there would have been much development and jobs generated.  Both India and China are helping Sri Lanka manage the ongoing economic crisis. However, India seems more proactive than China. Is this due to the way both countries practice diplomacy? Or are there other reasons? I think the Chinese are tough task masters. China offered nearly $ 1 billion for Sri Lanka to repay the loans we have got from them, so we could pay their loans but our debt would increase. Then we have a problem, we have to renegotiate/restructure debt with others – we have a lot of ISBs to settle and we can’t be doing this [what China offered] with them, especially with multilateral agencies. If we are going to have sustainable restructuring of debt, we have to treat every creditor the same way. We can’t treat India one way, China another, and so on. So I think Sri Lanka is right not to commit to such special treatment with the Chinese and I think China expressed displeasure over Sri Lanka going to the IMF, but Sri Lanka went regardless. Do you think China has distanced itself from Sri Lanka because of the strong India-Sri Lanka relations? Although they don’t say it, I believe so. Even India feels like that if and when we get closer to China. If Sri Lanka furthers connections to other countries like the US, China gets worried. So does India. There could be several reasons. One is because of the importance of the Indian Ocean; the Americans and Indians don’t want it to have a bigger Chinese presence, they want it to remain an ‘Indian’ Ocean. China has been growing linkages in the region for some time. For China, most of its trade and energy supply comes via the Indian Ocean and as such is a strategic line of communication. Of course, China has developed a rail system which goes to Europe, but the bulk of its trade and fuel has to come via sea. The Chinese want more freedom in the Indian Ocean than the Indians and Americans are willing to give them. India and the US are unwilling to understand that China’s development is a factual situation, they also don’t want the Chinese ‘One Belt, One Road’ (OBOR) to be successful in other countries. The Americans, Japanese, Indians, and Australians with their Quad have other intentions. Every major country wants to expand its power and influence. How important is it for Sri Lanka to balance foreign policy and economic needs during this crisis? I think economic and foreign policy have to go hand in glove. It is very important that we formulate a sound foreign policy, one that is balanced and will assist the country meet its economic needs. Policy consistency is also important. We need to create a climate to bring in investments to Sri Lanka. Our Constitution under Article 157 of the 13th Amendment has entrusted the Ministry of Foreign Affairs with entering into treaties and/or conventions with foreign countries. This is an important function, be it for trade, security, or investment. Of course, the Foreign Ministry has to work with the relevant line ministry. The Article also gives provisions to offer investment security to foreign states, companies, or investors; of course this is subject to national security related matters. Why are these laws not being used to offer investors confidence and ensure there is transparency? Any investment or project – be it government to government or Sri Lanka with a foreign company – can be brought to Parliament and passed with a two-thirds majority and thereafter the agreement becomes law, which the Executive or administration cannot object to. If we do this, investors will not be scared to invest in Sri Lanka. It also ensures transparency about the projects; the public will get to know. Why has this not been done? Is it because of underhand dealings? Transparency on investment and funding is very important. I would say that we should offer similar terms to local businesses and investors to encourage them. Parliamentary oversight is also guaranteed through this process. There has been criticism over Indian strategic investment in Sri Lanka, especially related to investment by the Adani conglomerate, at Colombo Port and now in Mannar. People say Sri Lanka has lost its sovereignty. Adani has expressed disappointment at the criticism. Can we afford to upset India now? We must not upset investors, especially investors from countries that have always stood by us. The Rajapaksa Government by rejecting the Light Rail Transit (LRT) project and the East Terminal (Colombo Port) upset the Japanese and pushed them away. When we planned to expand our Colombo Port, our Government should have understood that Sri Lanka needs Indian transshipment and an Indian investor would then be committed to our success – to the success of Colombo Port. People talk about sovereignty. What is the sovereignty you and I have today? We don’t even have the freedom to move around; there is no fuel and public transport is dwindling. We are restricted in what we can buy, how we spend, and even on electricity. How best can Sri Lanka manage strategic investment relations, especially related to India, China, Japan, and the US? I think the Government has trouble understanding investment and the kind of projects that need to be prioritised. In the LRT issue, the Government got a study done which is said to have highlighted the negatives of the project. But did they highlight what we would miss if the project didn’t go through and the fallout from the cancellation? Particularly the impact on Japan and its assistance to us? Advisors and officials should have briefed the policymakers better and they in turn should have looked into this more carefully. No president is a perfect president, no official or advisor is perfect. However, when we have imperfect people giving imperfect advice, the leaders will behave in such a way. How will recent claims over Kachchativu play into Indo-Lanka relations at this stage? Do you think it could be disruptive? I think this matter has been on our table for ages. I don’t think it will change things much. Even if the Tamil Nadu Chief [Minister] said something, the Central Government of India did not react to it. Some Indian officials and politicians say they need to bring sanity to Sri Lanka. Some wanted to send the Indian Army to Sri Lanka. But Sri Lanka has never offered sanity to India, on Kashmir, the national registry of persons, or when the farming issues in India came up. Our politicians are sane enough not to offer ‘sanity’ to India. The Chinese Ambassador recently visited the east of Sri Lanka and toured Trincomalee Harbour and China Bay, close to the IOC oil tank facility. They have shown some interest in the east. How will India feel about this venture by China? India is worried about China in the north of our country due to proximity, as technology can pose a threat to Indian interest. Of course, with satellite and cyber technology today, proximity and borders mean little when it comes to security. I think India is worried about China’s use of soft power, which can be used to undermine Indian interest or something India wants to do. China is very clever in the use of soft power. Somewhere in 2018, China started offering Sri Lankan officials, media personnel, and others planned visits to China. I know a professor who visited China on official visits three times in two years. I got a briefing from some of the officials who visited China. The Chinese have understood that Sri Lankans and other South Asians like free travel. Now you can’t get some of these trade unionists or public officers to speak against China. The Indians have also been practising soft power in Sri Lanka, but the Chinese have invested more money in it. China has replicated this soft power model in many places like Africa, Southeast Asia, and Central Asia; they have even done it in India, so the Indians are concerned. Recently, US Senate Foreign Relations Committee Chairman Senator Bob Menendez suggested that the Quad could lead the way to avoid an economic implosion in Sri Lanka and have a regional impact. In your opinion, would such an approach complicate Sri Lanka’s foreign policy approach? The statement by Menendez is a blatant statement. “Under the Rajapaksas, Sri Lanka has been left on the brink of financial ruin and humanitarian catastrophe. Mahinda Rajapaksa led his country straight into a Chinese debt trap and then his brother, Gotabaya Rajapaksa, failed to take the prudent economic steps necessary to avoid a default on its sovereign debt. Today, Sri Lankans of all backgrounds are rising up to make clear that it is time for a change,” the Senator wrote to the Foreign Minister of the four countries, the US, India, Australia, and Japan. This is seen by the IMF, World Bank, and the EU. So sometimes, if these people are interested in countering the Chinese, they may come forward. This type of thing may see the US influencing the IMF on Sri Lanka; to what end, is the question. The Chinese may see this as an unwarranted escalation against them by the Quad, because the Quad is not only interested in helping Sri Lanka; it also has a security focus on the Pacific and Indian Ocean, the Malacca Strait, and the South China Sea. During the crisis we are facing, if you take recent IMF statements, you see the same language: economic and governance. Samantha Power, the World Bank, India – all these people are talking about a political and economic crisis. They don’t say so outright, they will use words like governance and poverty alleviation. Therefore, a political statement by Menendez cannot be taken in isolation. This is where our foreign policies should be developed enough to analyse what is being sent and how to respond, if a response is needed. We have to create that by-law. The 21st Amendment should have included a provision to create a State policymaking body that is professional and capable. Today, it’s almost like there is no foreign policy in Sri Lanka; the minister comes and says something and that is it.


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