Sri Lankans headed to the polls on Saturday for a presidential election that could shape the nation’s path following its severe economic crisis and political turmoil. With 38 candidates in the race, the contest is primarily viewed as a three-way battle among incumbent President Ranil Wickremesinghe, Marxist-leaning lawmaker Anura Kumara Dissanayake and opposition leader Sajith Premadasa.

With 17 million voters eligible to participate, the final results are expected to be announced on Sunday. The outcome will reflect public sentiment towards Wickremesinghe’s leadership during a fragile recovery phase, particularly as the country restructures its debt under an International Monetary Fund (IMF) program after defaulting in 2022.

Impact on IMF agreement!

The government revealed on Thursday that it had made significant progress in debt restructuring, reaching a preliminary agreement with private bondholders on over $17 billion of its total $83 billion debt at the time of default. Despite some positive economic indicators, many Sri Lankans continue to face challenges due to high taxes and living costs. Both Premadasa and Dissanayake have expressed intentions to renegotiate the IMF agreement to alleviate the impact of austerity measures.

Wickremesinghe cautioned that altering the terms of the agreement could jeopardise the release of a crucial fourth tranche of nearly $3 billion in IMF assistance necessary for maintaining economic stability. 

Economic crisis due to COVID-19

The country’s economic crisis was largely attributed to excessive borrowing for non-revenue-generating projects, compounded by the effects of the COVID-19 pandemic and mismanagement of foreign reserves.

The economic collapse led to severe shortages of essentials like food, medicine, cooking gas and fuel, causing long lines and widespread public unrest. Protests escalated into riots, resulting in the occupation of key government buildings and the resignation of former President Gotabaya Rajapaksa, who fled the country amid the chaos. 

Wickremesinghe, who took office in July 2022 following a parliamentary vote to complete Rajapaksa’s term, is now seeking a full term to consolidate the recent gains. However, he faces criticism for allegedly shielding members of the Rajapaksa family, who are often blamed for the economic crisis. His previous election relied heavily on support from Rajapaksa loyalists, both in Parliament and within his Cabinet. 

As Sri Lankans vote, the results will be pivotal in determining the future direction of the country’s recovery and governance.

Significance for India

The elections in Sri Lanka have an impact outside of the country, as India being its neighbour is interested in the presidential elections for numerous reasons. First being the Tamil minority in Sri Lanka as they maintain close ties to India’s Tamil Nadu. The Tamilian minority and those who support it are concerned, with Sinhalese politicians leading the way. As per Reuters, the Tamil community in Sri Lanka has ‘no hope’ for the results of the presidential election.

The primary concern for India is China’s increasing sway on Sri Lanka. Due to Sri Lanka’s advantageous location for both military and commerce operations, the two nations have been competing for a foothold there. In fact,due to a financial setback, Sri Lanka has handed over control of Hambantota, a major shipping centre, to China for 99 years. The nation’s dependence on China has increased over time as Sri Lanka got 11.2 billion dollars in loans, bailouts and grants from China between 2006 and 2022, as per a Bloomberg report.

Bloomberg reported that India’s Adani Group has embarked on a multibillion dollar initiative to expand the Colombo West International Terminal. 

(with inputs from agencies)