Tag Archive for: Sri Lanka

Sri Lanka stalls Starlink over security and sovereignty concerns

Starlink is great for developing countries, offering connectivity without costly infrastructure. But it’s a challenge for their national security, since authorities can’t monitor the traffic it carries.

This policy conflict arose in Sri Lanka in early May, when the government paused rollout of the satellite communications service, blocking one of the few ways to ensure affordable connectivity to remote and vulnerable areas.

Satellite internet can help close significant connectivity gaps across Sri Lanka, especially in remote, underserved and disaster-prone regions where fibre and mobile networks are limited. For a country recovering from conflict and economic crises, affordable and resilient connectivity is essential. But the government’s inability to monitor or intercept traffic through Starlink’s infrastructure has triggered alarm bells. Authorities say the service can’t proceed until security and regulatory frameworks are in place.

While regulatory hurdles for Starlink are increasing, Sri Lanka’s case is distinct. Some countries, including Lesotho and Cambodia, have approved Starlink as part of broader trade negotiations with the United States. In contrast, Sri Lanka independently initiated licensing reforms and has since paused rollout to address legal and security concerns. It’s one of the few small states asserting regulatory sovereignty, rather than accommodating external pressure.

Sri Lanka isn’t alone. India required Starlink to suspend preorders in 2021 until it secured proper licencing. Indonesia approved Starlink in 2024 only after obtaining regulatory assurances. And France revoked Starlink’s licence in 2022 after a court ruled regulators failed to conduct mandatory public consultation.

The licencing delay reflects broader shifts in Sri Lanka’s approach to digital governance. The current administration has placed greater emphasis on regulatory control, particularly when it comes to foreign-operated digital infrastructure. The Online Safety Act, passed in early 2024, created the Online Safety Commission with powers to regulate content and digital platforms. Online service providers, including foreign platforms, must comply with requirements on matters such as disinformation, incitement and national security.

While Starlink isn’t a social media platform, its architecture enables encrypted, high-speed internet access that bypasses local routing and oversight. That conflicts with Sri Lanka’s digital governance agenda, which emphasises legal accountability, interoperability with domestic regulation and alignment with security priorities.

In that sense, the Starlink pause reflects a bigger reckoning over who controls Sri Lanka’s digital infrastructure, and under what rules.

Starlink’s technical promise is clear: with over 6,000 satellites in low Earth orbit, the network can deliver fast, reliable internet to areas often left behind. That makes it attractive to countries such as Sri Lanka, where coverage gaps persist. The satellite internet market is also expanding rapidly with competitors including Amazon’s Project Kuiper and OneWeb preparing to enter the satellite broadband space.

Recognising the potential of satellite networks, former president Ranil Wickremesinghe’s administration met Elon Musk and fast-tracked approvals in 2024. This followed the passage of an updated Telecommunications Bill—the first amendment to the law in 28 years—which introduced new licence categories and explicitly enabled Starlink Lanka to operate as a licensed service provider, pending regulatory approval.

That momentum has stalled under the new government. President Anura Kumara Dissanayake’s administration has raised concerns about Starlink’s limited integration with national infrastructure, restricting lawful government and regulatory oversight.

That lack of oversight is a dealbreaker under current policy settings. As with many countries, Sri Lanka’s regulatory posture is still evolving, but with heightened concerns about extraterritorial digital services, it’s unlikely to make exceptions.

This echoes Sri Lanka’s caution with Huawei’s 5G rollout. Although not banned, Huawei was sidelined after key partners raised espionage concerns. Starlink presents a different risk, as it’s less about foreign surveillance and more about domestic blind spots. But the underlying issue is similar: what happens when critical digital infrastructure lies beyond the reach of the state?

Sri Lanka’s hardline stance comes at a cost. Blocking Starlink might slow digital inclusion, especially in hard-to-reach areas. And while the government has signalled interest in developing its own telecommunications capabilities, infrastructure rollouts take time, and the country is still navigating the tail end of an economic crisis that makes this more aspirational than practical.

A more strategic approach might involve conditional approvals. That could include mandating Starlink to partner with a licensed domestic telecommunications provider, such as Dialog or SLT-Mobitel, to establish in-country gateways or route traffic through national internet exchanges. These measures would comply with Sri Lanka’s regulatory requirements and enable oversight.

The Starlink case should prompt Sri Lanka to clarify its digital infrastructure policy. It will face similar questions over foreign cloud services, cross-border data flows and AI platforms. Setting clear, predictable rules now would help manage future risks and reinforce the country’s ability to safeguard its digital sovereignty.

That may be difficult, but it’s not impossible. Sri Lanka’s Starlink pause is a reminder that political will can ensure foreign digital services—from satellites in orbit or platforms online—adhere to local rules.

Sri Lanka holds its own amid economic uncertainty

In recent months, Colombo has faced two sharp blows from its Western partners. First was the surprise cut to USAID funding, amounting to approximately US$53 million. Then came a 44 percent tariff on apparel exports to the United States—Sri Lanka’s largest export market. Both moves came without warning and show the US not separating friends from foes, damaging the bilateral relationship and the US’s reputation.

Sri Lanka is discovering that even its most trusted partners can act unpredictably when domestic politics take precedence. Its experience with opaque Chinese loans was one kind of risk, but the recent moves by its democratic partners are another.

As Sri Lanka absorbs the shock of steep new tariffs, the US has carved out exemptions for certain Chinese electronics, highlighting how trade decisions are often shaped more by domestic cost concerns than by supporting partners. This sends a troubling message. The US urges countries, including Sri Lanka, to reduce their dependence on China but then withdraws its support and imposes trade barriers. If Washington wants alignment in the Indo-Pacific, it must act like a consistent partner, not an erratic one.

To its credit, Sri Lanka is not passively absorbing the fallout. Since the 2022 economic crisis, the government has moved to diversify partnerships and reset foreign policy. The current administration, elected in late 2024, has taken a more pragmatic and reform-oriented approach to diplomacy. For example, Sri Lanka and Thailand recently signed a free trade agreement. Colombo has also signalled its intent to join the Regional Comprehensive Economic Partnership and has deepened ties with India, Japan and the Middle East.

These moves follow a broader recalibration that began after years of dependency on China for post-war infrastructure financing, a relationship that eventually triggered a debt crisis. Colombo has since completed important debt restructuring, restored modest growth and brought inflation under control.

Crucially, it is doing this while maintaining a non-aligned posture. Sri Lankan President Anura Kumara Dissanayake has reiterated that Sri Lanka is ‘not pro-Indian or pro-Chinese’ but firmly focused on protecting its own interests. That philosophy has translated into action. Colombo has paused military visits from Chinese research vessels to ease Indian concerns while still welcoming Beijing’s investment in more commercially viable, equity-based projects. The government is now prioritising transparency and risk mitigation over opaque mega-deals.

India, meanwhile, is expanding its presence with its own strategic interests in mind. For example, Indian Prime Minister Narendra Modi’s visit to Colombo in April brought renewed momentum to the long-stalled Trincomalee energy hub.

India is also backing a 120-megawatt solar power plant in Sampur, on a site once offered to a Chinese-backed coal venture that was later shelved due to environmental and strategic pushback. This clearly shows a shift in the energy landscape that Australia should consider, given its pursuit of solar power almost entirely relies on China.

Sri Lanka-India defence ties are deepening too, through joint patrols, training and Sri Lanka’s participation in the Colombo Security Conclave.

These developments don’t mean Sri Lanka is decoupling from Beijing. China remains a key creditor and infrastructure partner, though its role is evolving. Due to its experiences with the Belt and Road Initiative and Hambantota port, Colombo realises it cannot depend only on China. And Beijing is now favouring smaller, commercially viable projects and equity-based investments over the debt-heavy megaprojects of the past, in part because of public and private criticism.

Crucially, India is a close neighbour and a bridge to other Indo-Pacific powers. The US remains relevant, but its recent unpredictability—cutting aid, raising tariffs and exempting China—is eroding trust.

What’s different this time is that Sri Lanka isn’t just reacting. It’s acting. The government is rolling out institutional reforms, including anti-corruption efforts in the customs department and pledges to repeal the Prevention of Terrorism Act. These steps are essential not just for domestic credibility but for reassuring partners that Sri Lanka is a stable, safe and reliable state. Progress is mixed, but Colombo’s intent is clearer than it has been in years.

Still, structural vulnerabilities remain. The global economy is heading into rougher waters. US President Donald Trump’s sweeping ‘reciprocal tariff’ policy could further squeeze Sri Lanka’s exports. Colombo is especially exposed as it has no free trade agreement or privileged access under the generalised system of preferences. Tourism is recovering, but any trade slowdown in the West could hit remittances and export earnings hard.

That makes diplomatic agility more important than ever. Sri Lanka must continue building economic resilience through diversification, value-added exports and deeper South-South cooperation. It should also court middle and regional powers—including Japan, South Korea and Gulf states—who offer investment without great-power entanglements.

For Washington, the message should be equally clear: if nations such as Sri Lanka are being pushed towards China, your policy settings probably aren’t right. Development aid, trade access and political consistency are not just tools of influence; they are measures of partnership. If the US wants to remain a credible actor in the region, it must demonstrate reliability and respect for countries navigating complex geopolitical terrain. For Colombo, due diligence is vital, regardless of the partner. That means holding all partners to the same standard.

Sri Lanka’s long road to recovery

The economic and political upheavals Sri Lanka has faced in recent years, including its 2022 debt default and the mass protests that ousted former President Gotabaya Rajapaksa, serve as a stark reminder of the dangers posed by poor governance and rampant inequality.

A 2023 report by the International Monetary Fund attributes the country’s ongoing crisis to widespread corruption and fiscal mismanagement, underscoring the urgent need for the new president, Anura Kumara Dissanayake, to implement bold structural reforms aimed at restoring public trust and promoting social justice.

At the heart of Sri Lanka’s ongoing crisis is a deeply flawed institutional framework, plagued by inefficiencies and susceptible to political interference. The IMF report highlights the erosion of independent institutions such as the Public Service Commission, the National Police Commission, the Audit Service Commission, the Commission to Investigate Allegations of Bribery or Corruption (CIABOC), the Finance Commission and the Delimitation Commission, which led to the mismanagement of public resources and a chronic lack of transparency. Unless, and until, these fundamental governance issues are addressed, economic recovery will remain out of reach.

To revive Sri Lanka’s economy, Dissanayake, the leader of the left-wing National People’s Power alliance, should pursue three major reforms. First, he must strengthen institutions like the CIABOC and improve oversight of public appointments. Second, improving fiscal transparency and procurement policies could reduce inefficiencies and increase trust in public spending. Lastly, limiting government officials’ discretionary power over tax incentives would curb corruption, boost revenue and promote fiscal responsibility.

Dissanayake must also confront the deeply entrenched structural inequalities that have long impeded Sri Lanka’s GDP growth. In his 2012 book The Price of Inequality, economist Joseph E Stiglitz argues that inequality is ‘not just a moral issue, but an economic one’, with the potential to stifle growth and trigger social unrest. Sri Lanka, where rising income inequality has been a major cause of socioeconomic instability, is a prime example of this dynamic. As the IMF report suggests, corruption-fuelled financial mismanagement and opaque tax policies have deepened Sri Lanka’s income disparities.

Reducing inequality is critical for Sri Lanka’s long-term economic and political stability. Building on Stiglitz’s insights, the new administration must pursue progressive tax reforms to ensure that the burden does not fall disproportionately on lower-income households. This approach also aligns with the IMF’s call for greater transparency in tax incentives and exemptions.

Another way to reduce inequality is to invest in public goods such as education, health care and infrastructure. Sri Lanka must redirect resources from the inefficient capital investments favoured by the Rajapaksas toward projects that directly benefit underserved communities. Establishing a transparent and competitive investment process could help direct resources to where they are most needed, in line with the IMF’s recommendations.

Labor-market reforms are equally important. Sri Lanka’s economic recovery hinges on creating equitable job opportunities by guaranteeing fair wages and safe working conditions, particularly in sectors like manufacturing and services, where inequality is most pronounced.

Weak, poorly designed institutions often allow wealth to be concentrated in the hands of a few. As the IMF report reveals, the lack of independent governance structures in Sri Lanka has caused corruption and inefficiency to flourish. To reverse this trend, Dissanayake’s administration must bolster regulatory frameworks, protect independent agencies and the judiciary from political interference, and create a level playing field that provides equal opportunities to everyone.

Civil society can play a pivotal role in this transformation. As Stiglitz notes, inclusive governance holds the key to reducing inequality. The IMF report criticises the absence of platforms for public participation, emphasising the importance of citizen engagement in holding institutions accountable.

A vibrant civil society and a free press are crucial to restoring trust in the country’s institutions. But reforming Sri Lanka’s draconian and outdated security and anti-terrorism laws—remnants of the decades-long war against the Liberation Tigers of Tamil Eelam—Dissanayake could encourage greater public participation and promote accountability.

In sum, to accelerate its economic recovery, Sri Lanka must revitalise its institutions and tackle the systemic inequities that have fuelled much of its recent turmoil. Implementing the IMF’s technical recommendations would help stabilise the country’s finances, while drawing on Stiglitz’s insights could help reduce income and wealth gaps.

But long-term growth will require bold leadership. Fostering transparency, accountability, and meritocracy would help Sri Lanka build a stronger, more resilient economy, laying the groundwork for a more just, prosperous and sustainable future for all its citizens.

Sri Lanka’s next test

In a win for democracy, mass protests in Sri Lanka recently led to the resignation of President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa. A strongman who won popularity for overseeing the end of Sri Lanka’s civil war in 2009 (while his older brother, Mahinda, was president), Gotabaya was elected in November 2019 and promised to safeguard national security and deliver prosperity. He failed miserably.

Despite allegations of corruption, war crimes and attacks on journalists, the Rajapaksa government had a powerful mandate, which was reinforced nine months later when the brothers’ party, Sri Lanka Podujana Peramuna (the Sri Lanka People’s Front), won a two-thirds majority in parliament. Yet, during his short tenure, the Rajapaksas drove the country into bankruptcy, food insecurity and spiralling inflation.

Gotabaya announced his candidacy just days after the 2019 Easter Sunday bombings, promising a strong response to terrorism. In the months that followed, newspapers’ and radio stations’ frenzied coverage heightened people’s fear of Muslims (who comprise 10% of the population), and attacks on them increased. Gotabaya capitalised on this environment, portraying himself as a defender of the Sinhala Buddhist majority who would transform Sri Lanka into a Singapore of the Indian Ocean. The clergy, media, military, political elites and local business tycoons all adopted the same rhetoric, tying their fortunes to his.

The Buddhist clergy, for example, continuously reaffirmed their trust in Gotabaya throughout his presidency. In return, he established a Buddhist advisory council of notable monks to help guide his policy decisions. Even in January of this year, as families began rationing food, and as the central bank sold its remaining gold reserves to pay back an international bond, the Buddhist establishment spoke up for Gotabaya, arguing that he was still the only leader who could save the country.

By March, hospitals were reporting shortages of essential medicines, and two elderly men died while queuing for gasoline. Unable to pay for fuel to produce electricity, the government instituted rolling blackouts that culminated in 13-hour power cuts at the height of a suffocating heat wave. That was the final straw. Protesters stormed the streets and demanded the Rajapaksas’ resignations.

The political class responded by playing musical chairs within the cabinet of ministers, while demonstrators occupied the area surrounding the Presidential Secretariat. The space that Rajapaksa had set aside as an ‘agitation area’—a move heavily criticised for limiting people’s freedom of assembly—was renamed GotaGoGama (Gota Go Village). It became the home of the Aragalaya (struggle) against the government, which has now raided the site and arrested protest leaders.

The Aragalaya was unusual in that it welcomed Sri Lankans from all ethnic backgrounds. In April, protesters outside the Presidential Secretariat included activists from the Muslim community—a direct rejection of the chauvinist sentiment Gotabaya had stoked. Demonstrators also cooked a mixture of water and rice (kanji) to commemorate Tamil civilians who died during the last stages of the war, when indiscriminate shelling made it impossible for them to secure other food.

The Aragalaya thus became a place where people lived out the alternative to the Rajapaksa brand of politics. The protesters celebrated unity amid diversity, demonstrating that hope comes not from leaders but from the power of people.

But does this solidarity reflect a mere marriage of convenience? Just two and a half years ago, many of the current anti-government protesters endorsed the Rajapaksas’ brand of majoritarian politics. Today, they complain that parliament is full of cheats and liars. Yet it is they who voted for the charlatans in free and fair elections.

The Rajapaksas were given a mandate despite their well-known record of corruption, authoritarianism and violence. The protests began not when the family stole public funds or trampled on minority rights, but when Sinhalese were called extremists and terrorists just for demanding food.

The institutions that underwrote Gotabaya’s power have now lost credibility. Businesses and others who aligned with the Rajapaksas are being shamed on social media, and any elite Buddhist clergy who dare to show up at protests are lambasted. The military and the police, once praised for their service, are now seen as vehicles of state repression, and major media organisations have been condemned for whipping up anti-minority sentiment.

The question now is what will fill the vacuum. Sri Lankans have a rare opportunity to build a new identity based on this struggle for dignity. After being tear-gassed and battered by the police, Sinhalese protesters have caught a glimpse of the violence and mistreatment that Tamils have suffered. After watching their businesses collapse from lack of electricity, they now have a sense of what Muslims feel when their businesses are torched by angry mobs. And after feeling the effects of sharply rising inflation, all households now recognise that plantation workers cannot live on US$3 a day.

In each case, the Sinhala Buddhist majority has been given a window onto the decades of deprivation suffered by minorities. Sinhala Buddhists are connecting with their inner Tamils and Muslims. But only by building on this shared trauma can Sri Lankans transform resentment against the Rajapaksas into a new social contract. By renegotiating our communal bonds and relationships, we can construct a new collective identity. That means rejecting majoritarianism and corruption, and embracing our shared struggle for a free and prosperous future.

The fall of Sri Lanka’s house of Rajapaksa

For nearly two decades, the four Rajapaksa brothers and their sons have run Sri Lanka like a family business—and a disorderly one, at that. With their grand construction projects and spendthrift ways, they saddled Sri Lanka with unsustainable debts, driving the country into its worst economic crisis since independence. Now, the dynasty has fallen.

Mahinda Rajapaksa was instrumental in establishing the dynasty. After becoming president in 2005, he ruled with an iron fist for a decade, attacking civil liberties, expanding presidential powers (including abolishing term limits) and making bad deal after bad deal with China. Throughout this process, he kept his family close, with his younger brother Gotabaya holding the defence portfolio.

But in 2015, Mahinda narrowly lost the presidential election and the Rajapaksas were briefly driven from power. During that time, parliament restored the presidential term limit, ruling out another Mahinda presidency. Yet the family quickly devised a plan to restore their dynasty: Gotabaya would renounce his US citizenship and run for president.

Gotabaya was well-positioned to win. After all, he had been defence secretary in 2009 when Mahinda ordered the final military offensive against the Tamil Tiger rebels, bringing a brutal 26-year civil war to a decisive end. With that, the Rajapaksa brothers emerged as heroes among Sri Lanka’s Sinhalese majority.

To be sure, the final offensive killed as many as 40,000 civilians and sparked international accusations of war crimes. The United Nations described it as a ‘grave assault on the entire regime of international law’. According to wartime military commander Sarath Fonseka, Gotabaya ordered the summary execution of surrendering rebel leaders. In California, where he was previously domiciled, Gotabaya faces civil charges over alleged war crimes.

But the Rajapaksa brothers simply presented themselves as hardheaded custodians of Sinhalese interests. And, thanks largely to his ethno-nationalist credentials, Gotabaya won the 2019 election—at which point he immediately appointed Mahinda as his prime minister. Mahinda then appointed his two sons, his other two brothers and his nephew as ministers or to other government positions.

The same year, 277 people were killed, and hundreds more wounded, in bombings carried out by Islamist extremists on Easter Sunday. The attack highlighted tensions that had been simmering since 2009: though the military offensive marginalised the Hindu-majority Tamils, the war’s end sowed the seeds of religious conflict between the Buddhist-majority Sinhalese and Sri Lanka’s Muslims, who constitute a tenth of the country’s population. The Easter Sunday terrorist bombings provided new ammunition for the Rajapaksas to whip up Sinhalese nationalism.

Beyond deepening ethnic and religious fault lines, Gotabaya followed his brother in establishing an imperial presidency, exemplified by the passage in 2020 of a constitutional amendment expanding the president’s power to dissolve the legislature. And he helped to push Sri Lanka further into the economic death spiral that his brother had helped create, not least through his dealings with China.

During Mahinda’s rule, as China shielded the Rajapaksas from war-crime charges at the UN, it won major infrastructure contracts in Sri Lanka and became the country’s leading lender. Debt to China piled up, incurred largely over the construction of monuments to the Rajapaksa dynasty in the family’s home district of Hambantota.

Examples include ‘the world’s emptiest’ airport, a cricket stadium with more seats than the district capital’s population, and a US$1.4 billion seaport that remained largely idle until it was signed away to China in 2017 on a 99-year lease. The most extravagant China-backed project is the US$13-billion ‘Port City,’ which is being built on land reclaimed from the sea close to the centre of the capital, Colombo.

China’s modus operandi is to cut deals with strongmen and exploit their countries’ vulnerabilities to gain a strategic foothold. China’s larger aims in Sri Lanka were suggested in 2014, when two Chinese submarines made separate unannounced visits to Colombo, docking at a newly built container terminal owned largely by Chinese state companies.

So, China gained leverage over a country located near some of the world’s most important shipping lanes and Sri Lanka became increasingly mired in debt, including ‘hidden debt’ to China from loans whose public disclosure was prohibited by their terms. But hubris prevented the Rajapaksas from recognising the looming crisis. On the contrary, they enacted a sweeping tax cut in 2019 that wiped out a third of the country’s tax revenues.

Then the Covid-19 pandemic hit, crushing the tourism and garment industries—Sri Lanka’s two main foreign-exchange earners. More recently, the war in Ukraine, by triggering soaring international energy and food prices, helped to drain Sri Lanka’s foreign reserves, creating fuel, food, medicine and electricity shortages. It was the final straw for many Sri Lankans, who took to the streets in droves.

On 9 May, Mahinda reluctantly resigned from his post as prime minister, in an effort to appease protesters. But protests continued to rage, culminating in the storming of the seaside presidential palace by demonstrators. Gotabaya fled minutes earlier before conveying his decision to resign.

Within Sri Lanka, photos of protesters lounging on the president’s bed and cooking in his backyard have become a symbol of people’s power. But they should also serve as a warning to political dynasties elsewhere in the world, from Asia to Latin America. When a family dominates a government or party, accountability tends to suffer, often leading to catastrophe. This can cause even the most entrenched dynasty to fall—and swiftly.

There is also a lesson for other heavily indebted countries. Unless they take action to make their debts sustainable, they could quickly be overwhelmed by crisis.

As for Sri Lanka, its next leaders will have to address shortages of basic necessities, rebuild a wrecked economy, re-establish the rule of law and hold responsible those who caused the current disaster. But in a country where politics is a blood sport, one should not underestimate the challenge of overcoming the Rajapaksas’ corrosive legacy.