President Dissanayake's success in Sri Lanka will ultimately depend on his pragmatism and navigation skills
In a historic election, Sri Lankans have chosen Anura Kumara Dissanayake, a Marxist-Leninist politician, to lead their crisis-hit country. While it is not very usual for political paradigm shifts to come about through general elections, this unusualness shows how eager the Sri Lankan populace to see some pro-working-class changes. The question is: how far will the new president be able to deliver on those much-aspired changes?
Anura Kumara Dissanayake's political ideology stands in stark contrast with all his predecessors, and that contrast is well-rooted in as well as reflected in divergent socio-economic policies. The key internal challenges lying ahead of Dissanayake are two-fold: first, easing the economic hardships of the Sri Lankan people crushed under the recent economic crisis and the austerity measures that followed, and second, going past Sri Lanka's long and violent history of ethnic conflict to ensure harmony among the different groups and factions.
The foreign exchange shortfall in 2022 forced Sri Lanka to default on its foreign debt. Inflation hit 70% in September 2022 and the economy has recorded a shrinking growth rate ever since. A $2.9 billion International Monetary Fund (IMF) bailout secured in March 2023 allowed Sri Lanka to tame inflation and to revive its foreign exchange reserves. The country also gained the initial footing for negotiating debt structures with major international creditors. So far, Sri Lanka has managed to restructure about $10 billion in bilateral debt and another $12.5 billion of international bonds.
The IMF bailout came with a fiscal target of 2.3% of GDP primary balance by 2025. Primary balance is the difference between government revenue and government expenditure excluding debt payments, measured as a percentage of a country's GDP (Gross Domestic Product). It can be improved either by restraining expenditure or increasing the tax revenue or both. Outgoing president Ranil Wickremesinghe had adopted harsh austerity measures such as energy rationing and increasing direct taxes. But the burden of adjustment fell disproportionately on the poorest, with the poverty rate hovering at thrice the pre-crisis level.
Dissanayake in his electoral campaign pledged to improve economic efficiency by reducing corruption. He promised to revive the public sector, to re-energise private companies and to create jobs in education and tourism sectors. He also promised to ease the burden of the austerity measures by extending tax relief and expanding social welfare schemes besides negotiating the revenue targets with the IMF.
Will Dissanayake be able to give some relief to the poorest quarter of the population which is still reeling under a cost-of-living crisis? Too early to tell. But his directives so far after assuming office indicate his focus on strengthening Sri Lanka's agrarian sector, human capital and basic infrastructure. While a major shift in the country's economic policy paradigm may not be practicable under the current scenario regarding the IMF, Dissanayake's emphasis on boosting the country's productive capacity is in line with his commitment towards easing the tax burden without compromising debt payments. Improving the efficiency of public institutions, especially the central bank and public finances, and increasing government accountability will be key to reviving the crisis-hit economy.
Even though the precise position of Dissanayake's ideological and policy stances on the left spectrum can be debated, there is no denying the fact that his political journey bears the marks of a critical history of far-left activism and revolutionary aspirations.
Coming from a non-political family, 19-year-old Dissanayake actively participated in the 1987-89 armed insurrection by the Janatha Vimukthi Peramuna (JVP). The insurgency and the subsequent counter-insurgency operations resulted in about 60,000 deaths according to official accounts, including almost the entire the-then leadership of the JVP.
The list of JVP killings during the insurgency included a number of Sri Lankan elites, businessmen, school principals, media representatives, communists and trade-unionists alongside military and police personnel. The government crackdown also took many civilian lives besides the JVP rebels. Although the JVP returned to mainstream politics under the leadership of Somawansa Amarasinghe, its political legacy was not easily separated from this collective trauma of those blood-drenched days.
Succeeding Amarasinghe in 2014, Dissanayake became the first JVP leader to apologise to his countrymen for the two failed revolutionary attempts by the JVP in the '70s and the '80s. He also fought the elections as a candidate on behalf of the JVP's own national coalition National People's Power (NPP). This nominal and temporal distance from the controversial past along with a chaotic presence characterised by the existing regime's failures helped them emerge as an acceptable alternative in front of the Sri Lankan constituents. A deep anti-elite sentiment after Rajapaksa's fall also resonated well with Dissanayake's pro-working-class promises.
The JVP's anti-Tamil stance remains a hurdle in the country's path to national harmony. In contrast to usual communist practices, the JVP increasingly sided with the Sinhalese national interest and even supported the Rajapaksa government's crackdown on the Tamil nationalist forces.
Notably, Dissanayake secured a lower percentage of votes in the Tamil-dominated provinces. Constituting only 12% of the population, the Sri Lankan Tamils are not a pivotal political force. Nonetheless, with a number of political groups, however small, upholding Tamil national interests both inside and outside the Parliament, Sri Lanka's national security will depend on how well Dissanayake's government can address the minority's grievances.
Besides these internal challenges, Sri Lanka also needs to strike a delicate balance in its foreign policy orientation. Both China and India are eager to extend their control over the Sri Lankan territories. Dissanayake was already invited to New Delhi months before the presidential election, and Chinese delegates visited him in Sri Lanka.
Though the overthrown Rajapaksa government had closer ties with China than India, the latter has built goodwill with its timely financial aid to Sri Lanka at the wake of the economic crisis. As anti-India sentiment gains more strength in the subcontinent, a friendly relationship with Sri Lanka is valuable to India.
The JVP has traditionally opposed India in many issues and had even alleged India of backing the secessionist activities of the Tamil Tigers in the past. Recently, they opposed the Adani Group's encroaching acquisitions in Sri Lanka's key sectors. At the same time, however, Dissanayake will have to be tactical in dealing with the Adani-close BJP government in New Delhi as he may not want to or afford to lose trade and collaboration opportunities with India.
The JVP's political outlook has always leaned towards China. However, the government must stay cautious in view of their mounting debt to China. Moreover, China's activities at the Sri Lankan ports had raised India's security concerns in the past. Dissanayake has voiced his commitment to protecting the country's autonomy without siding with either of the two superpowers and not allowing activities in the Sri Lankan territories that can potentially threaten regional stability.
Dissanayake's success on the economic, political, and diplomatic front will ultimately depend on his pragmatism and navigation skills. Soon after assuming presidential responsibility, Dissanayake appointed Harini Amarasuriya, one of NPP's three legislators, as the new prime minister. In addition, he has dissolved the parliament and announced a snap parliamentary election to be held in November. The situation presents Dissanayake and the NPP with a great opportunity for a system change, and the entire subcontinent is going to closely observe their course of action.
(Arka Bhaduri is an independent journalist currently based in the UK, who is interested in the political dynamics of South Asia and Europe, with focus on leftist movements and the refugee crisis)