Sri Lanka’s prisons hit 4x capacity amid government drug crackdown: Minister

Wednesday July 8, 2026 9:59 am ECONOMYNEXT — Sri Lanka’s prison system is facing severe overcrowding because of the government’s Ratama Ekata anti-drugs programme, with the inmate population nearly quadrupling its official capacity, minister Nalinda Jayatissa has said. The priso…

Wednesday July 8, 2026 9:59 am

ECONOMYNEXT — Sri Lanka’s prison system is facing severe overcrowding because of the government’s Ratama Ekata anti-drugs programme, with the inmate population nearly quadrupling its official capacity, minister Nalinda Jayatissa has said. The prison population has surged to 41,000, exceeding the system’s capacity of 11,000 inmates, he told reporters, in a sharp escalation from September 2024, when the prison population stood close to 28,000. “In prisons that can only accommodate 11,000 inmates, there was a population close to 28,000 by September 2024,” Jayatissa said. “Recently, due to the nationwide drug eradication operations being implemented and arrests being made while enforcing the law, this number has escalated further to 41,000 as of today.” To ease this infrastructure strain, a new detention facility is set to be established in the Mahamodara area of Galle. According to an Extraordinary Gazette notification issued under the powers granted by Section 2 of the Prisons Ordinance (Chapter 54), the facility will be officially designated as the “Mahamodara Prison,” holding country-wide jurisdiction. The order was signed by Minister of Justice Harshana Nanayakkara, in Colombo on July 7. While the new facility addresses physical space, the influx of inmates has also exacerbated systemic delays within the justice system, particularly due to a backlog in receiving forensic reports. Jayatissa noted that delays in getting Government Analyst reports have slowed down bail hearings and general court proceedings. The government has faced challenges addressing this, he said, including a lack of qualified applicants holding required chemistry degrees, though recruitment for the department is now moving forward. Meanwhile, the government is also expediting the recruitment of additional prison officers to manage the staff shortages plaguing the correctional system. Legal ambiguities stemming from a 2022 law have also created bottlenecks in filing cases, as uncertainty remained over the correct jurisdiction for specific drug-related offences. To resolve this, the government is currently drafting legislative amendments to clearly demarcate court responsibilities based on the volume of narcotics involved. “Therefore, we are currently amending that law so that cases involving drugs generally exceeding 10g are referred to the High Court, and if the amount is below that, they are referred to other lower courts,” Jayatissa said. (Colombo/July 08/2026)

Tuesday July 7, 2026 5:59 pm

ECONOMYNEXT –The International Monetary Fund (IMF) held a special discussion with the officials of Sri Lanka’s State Revenue Administration Reform and Modernization Department (RARMB) at the President’s Office and conducted a review process on the revenue reforms, the President’s Office said in a statement. The discussion was attended by a team from the IMF’s Fiscal Affairs Department led by Andrew Kille, Revenue Administration Project Manager Cindy Negus, IMF Resident Tax Advisor to Sri Lanka’s Inland Revenue Department Greg, Canadian senior advisor Bob Hamilton, and senior officials from the State Revenue Administration Reform and Modernization Department (RARMB). “The IMF representatives paid particular attention to plans for digital transformation projects, accelerating data integration, human resource and leadership development programmes, and sustainable strategies to broaden the tax base,” President’s Media Division (PMD) said in a statement. The discussion reviewed the reform process implemented over the past year under Sri Lanka’s Medium-Term Revenue Strategy (MTRS), covering the country’s tax system, customs procedures, excise administration and the overall public revenue framework, it said. “In this regard, the IMF delegation also held separate discussions with senior officials of the Inland Revenue Department, the Ministry of Finance, Sri Lanka Customs and the Department of Excise.” “The IMF also agreed to continue providing technical assistance and advisory support for the reform programme being implemented in relation to Sri Lanka Customs, the Inland Revenue Department and the Department of Excise.” The RARMB, established in 2025 under President Anura Kumara Dissanayake’s government, aims to modernize public revenue collection, improve the efficiency of tax administration, implement legal and institutional reforms, and provide integrated management of the Inland Revenue Department, Sri Lanka Customs and the Department of Excise. “As part of the Inland Revenue Department’s reform programme, its branches have been reorganised into Medium Corporate, Metro and Regional Offices under a structured restructuring process. As a result, tax compliance has increased from 40–45% to 70–75%,” PMD said. It also said a new draft Bill to amend the Customs Ordinance has been prepared and submitted to the Legal Draftsman’s Department. “Further measures, including simplifying the tariff structure, introducing paperless processes and improving facilitation for exporters, are also scheduled for implementation.” “Meanwhile, under the Department of Excise reform programme, work is already under way to modernise the Department’s operations through the introduction of a new Excise Management System.” The PMD also said an integrated coordination mechanism has also been established between Sri Lanka Customs and the Inland Revenue Department under the RARMB. “This mechanism is intended to facilitate data sharing, integrated risk management, joint audits and verification of tax compliance by importers through a unified system.” (Colombo/July 07/2026)

Tuesday July 7, 2026 4:43 pm

ECONOMYNEXT – Foreign investors bought a net US$3 million worth of Sri Lanka government securities in the week ended July 2, Central Bank data showed, as the rupee currency was recovering from near four-year low hit in May. Foreigners sold a net 1,001 million rupees (US$3 million at 1$=330 rupees) in the week. Despite the latest weekly inflow, Sri Lanka has suffered a total net outflow of around US$13.7 million so far this year amid sharp rupee volatility in the last two months. The rupee currency’s selling rate fell to as low as 354 against the U.S. dollar on May 21 before recovering and gaining to the 330 level. This week it appreciated to 330 level, the Central Bank data showed. The rupee had been steady for more than three years before the latest depreciation with the Central Bank citing higher oil and vehicle imports amid a lingering conflict in the Middle East. The rupee has fallen 7.7 percent through July 2 this year. The island nation witnessed a net inflow of over Rs.14.5 billion rupees in the previous week after the rupee started to stabilize. Globally, investors are cautious about economic growth due to the impact of the latest Middle East escalation. The island nation enjoyed a total inflow of around 71.5 billion rupees (around US$234.4 million) into rupee bonds last year. Analysts said Sri Lanka’s deflationary policies in the past helped inflows amid curtailed imports. However, the island nation has seen an uptick in inflation in the last three months after nearly 50 percent hike in fuel prices gradually. The government reduced the fuel price in the last week of June. The Central Bank raised its key monetary policy rate by 100 basis points in May to curb inflationary pressure stemming from higher demand. Before the May rate hike, the Central Bank kept its key policy rates steady since May 2025 after reducing them by 825 basis points over 24 months since June 2023 and foreign investors have been buying rupee bonds despite slight depreciation in the local currency. (Colombo/July 07/2026)

Tuesday July 7, 2026 4:38 pm

ECONOMYNEXT – Sri Lanka’s rupee closed at 334.75/85 to the US dollar in the spot market on Tuesday, from 334.90/335.00 the previous day, while bond yields closed broadly steady, dealers said. The telegraphic transfer rate for Sri Lanka’s rupee against the US dollar was 330.50 buying, 339.50 selling; the euro was 375.6944 selling, 389.6114 buying; and the pound was 441.8078 buying, 455.8534 selling. A bond maturing on 15.09.2027 closed at 10.30/45 percent, down from 10.35/45 percent. A bond maturing on 15.02.2028 closed at 10.45/50 percent. A bond maturing on 15.12.2029 closed at 10.95/11.05 percent, up from 10.95/11.00 percent. A bond maturing on 15.05.2030 closed at 11.17/25 percent. A bond maturing on 01.08.2030 closed at 11.25/30 percent, up from 11.23/30 percent. A bond maturing on 15.10.2030 closed at 11.28/30 percent, up from 11.26/30 percent. A bond maturing on 15.12.2032 closed at 11.57/65 percent, up from 11.55/60 percent. A bond maturing on 01.11.2033 closed flat at 11.60/70 percent. A bond maturing on 15.03.2035 closed at 11.67/77 percent. Rs 100,000 million Treasury bills are to be issued through an auction on 8 July. (Colombo/Jul7/2026)

Tuesday July 7, 2026 4:34 pm

ECONMYNEXT – CBL Investments Limited and its group of companies (CBL Group), a Sri Lankan diversified food manufacturing conglomerate, has appointed its Group Managing Director Sheamalee (Shea) Wickramasingha, as Chairman of the Group effective July 6. A food technologist by profession, Wickramasingha joined Ceylon Biscuits in 1991 and has held several leadership roles across the Group. Wickramasingha holds a Master of Science in Food Chemistry from Purdue University and a Bachelor of Science in Food Science & Industry from Kansas State University, USA. She joined the Board of Directors in 1996 and was Group Managing Director for more than a decade, shaping the Group’s long-term direction, strengthening its businesses locally, and driving its expansion into international markets, the company said. Wickramasingha is the eldest daughter of the late Mineka Wickramasingha, who founded the business in 1968. She replaces the late Ramya Sanath Amaraweera Wickramasingha, and will continue to serve as group managing director while assuming the responsibilities of chairman. CBL Group operates across confectionery, biscuits, chocolates, cakes, cereals, soya, coconut and fruit-based products, with brands including Munchee, Ritzbury, Revello, Tiara, Lanka Soy, Samaposha, Sera and Nutriline. Its products reach consumers in over 70 countries worldwide, with manufacturing operations in Sri Lanka, Ghana and Indonesia. The group is the licensed operator of SPAR supermarkets in Sri Lanka, and employs more than 7,000 people. Wickramasingha continues to play a role in Sri Lanka’s business and food sectors. She serves on the main committee of the Ceylon Chamber of Commerce, Advisory Committee on Processed Food and Beverages of the Export Development Board, the UNICEF Business Council in Sri Lanka, and as President of the Sri Lanka–Indonesia Business Council. Wickramasingha is also Chairperson of Modern Pack Lanka and serves on the Boards of JF&I Packaging Food Revolution and SPAR Sri Lanka. (Colombo/Jul7/2026)

Tuesday July 7, 2026 4:10 pm

ECONOMYNEXT — Sri Lanka’s cabinet has approved a pilot program to introduce bus sector clustering across three routes to curb operational inefficiencies and commuter inconvenience in the public transport sector, minister Nalinda Jayatissa said. The initiative will target bus routes 170, 177, and 190 and aims to move away from individual operational units by managing interconnected routes as a single cluster of integrated, coordinated services. Public passenger transport in the island is run by the state-owned Sri Lanka Transport Board (SLTB) and a number of independent private operators. The sector is rife with issues, including excessive competition, poor schedule adherence, an oversupply of buses, unsafe driving, traffic congestion, and inefficient resource use. Jayatissa said that while similar frameworks exist internationally, Sri Lanka’s initial approach will rely on voluntary cooperation rather than immediate corporate restructuring. “In some countries around the world, this is implemented as corporate companies. However, this program is not being done as companies, but rather on a voluntary basis,” Jayatissa said. According to the cabinet decision, the unified management strategy will seek to bring together all relevant stakeholders on the selected corridors to test the feasibility of a wider roll-out. Following the evaluation of the pilot program’s results, the government plans to expand the bus sector clustering framework to other regions across the country. (Colombo/Jul7/2026)

Tuesday July 7, 2026 3:43 pm

ECONOMYNEXT – Sampath Bank has introduced Google Pay for all mastercard and visa credit and debit cardholders, increasing Sri Lankan customers’ access to digital payments. Cardholders can now digitise their visa credit and debit cards, and mastercard credit and debit cards and perform transactions across in-store, in-app, and online platforms, bringing fast, secure, and globally accepted tap-to-pay functionality to Android devices, catering to the increasing demand for mobile-first solutions, the lender said. The solution removes the need to carry physical cards while ensuring acceptance at millions of merchants worldwide. “Card usage is evolving beyond physical formats into a more flexible digital payment environment. Google Pay enhances the everyday utility of SampathCards by enabling a consistent payment experience across multiple channels and geographies,” Chirath Samarasekara, Head of Card Centre at Sampath Bank said. “This integration strengthens customer engagement while aligning with the growing preference for contactless and mobile-first payments, reinforcing trust in digital channels.” Mobile wallets are reshaping how consumers interact with their finances, particularly among digitally savvy users and frequent travellers who prioritise convenience and security, the bank said. “Digital adoption today is driven by how intuitively financial services integrate into daily routines. Customers expect experiences that are secure, responsive, and globally relevant without added complexity,” Darshin Pathinayake, Chief Business Intelligence Officer at Sampath Bank. “Google Pay enables Sampath Cardholders to transact with confidence while staying seamlessly connected to their finances, where banking becomes a natural extension of everyday life rather than a separate interaction.” The initiative brings fast, secure, and globally accepted tap-to-pay functionality to Android devices, catering to the increasing demand for mobile-first solutions, the lender said. Transactions are backed by tokenization technology, which replaces sensitive card information with secure digital identifiers, ensuring that customer data remains protected. Sampath Bank’s digital infrastructure integrated with Google’s global payments ecosystem delivers scalability and reliability across both local and international payment environments, the bank said. (Colombo/Jul7/2026)