Foreign Affairs

## Summary Hon. Mahinda Jayasinghe highlighted the government's economic achievements, citing foreign reserves of USD 6.8 billion, growth in worker remittances, and strong tourism performance, while arguing that overseas workers' foreign exchange earnings are being prudently protected — contrasting this with what he characterised as wasteful foreign travel expenditure by previous administrations. He specifically noted that President Dissanayake conducted seven official visits to eight countries at a total cost of only Rs. 14.94 million, compared to what he described as billions spent on foreign travel under the Rajapaksa and Wickremesinghe presidencies. Jayasinghe rejected opposition criticism, arguing that the Leader of the Opposition — a senior minister in the 2015–2019 government — presided over a decline in GDP growth from approximately 5% to 2% and accumulated USD 12 billion in International Sovereign Bonds, and was therefore not credible in offering policy advice. He also accused the opposition and allied media of deliberately manufacturing and amplifying the recent fuel queue crisis to gain political advantage, characterising the opposition as unable to mobilise public support independently. He concluded by contrasting his party's parliamentary conduct with what he described as disruptive behaviour by previous government benches.

## Summary Deputy Minister Ariyarathne defended the government's economic management record while presenting a Regulation under the Foreign Exchange Act to relax capital outflow limits, raising business outward payment limits from USD 200,000 to USD 500,000 and personal foreign currency account limits from USD 20,000 to USD 25,000, reflecting improved foreign reserves of approximately USD 6.8 billion by end-2025 under the IMF programme. She cited January 2026 export and remittance data as evidence of economic recovery, while acknowledging risks from the Middle East conflict to oil prices, remittances, tea exports, and tourism. On cyclone relief, she confirmed LKR 25,000 payments had been largely completed for affected families, with further LKR 50,000 tranches in progress. She also outlined a LKR 47.6 billion fuel infrastructure investment, including LKR 31.9 billion for tank refurbishment and new construction to double storage capacity, and clarified that the President's "pawn shop" remarks referred to the inherited state of the economy rather than current policy.

## Summary Deputy Minister Muneer Mulaffer delivered a speech condemning the ongoing conflict in the Middle East, asserting that violations of national sovereignty and military force cannot be accepted as legitimate means of resolving disputes, and that dialogue and diplomacy must prevail. He emphasised Sri Lanka's direct stake in the conflict, noting that approximately one million Sri Lankan citizens work in the Gulf region, and acknowledged the economic vulnerability of Sri Lanka—still recovering from bankruptcy—should the conflict escalate globally. The Deputy Minister also criticised those seeking to exploit public anxiety over the war for domestic political gain, characterising attempts to spread panic about fuel shortages or create artificial crises as unconscionable. He concluded by reaffirming the Government's position that all nations must respect international law and sovereignty, and called for a swift return to peace in the region.

## Summary Hon. Kugathasan delivered a detailed speech supporting the regulation gazetted on 17 February 2026 under Section 22 of the Foreign Exchange Act, No. 12 of 2017, which partially relaxes restrictions on outward remittances while maintaining safeguards on foreign exchange reserves during Sri Lanka's post-crisis recovery. He outlined the key provisions, including investment limits of USD 500,000 for listed companies and USD 150,000 for unlisted companies, and noted that this marks a significant shift from the full suspension of Outward Investment Accounts that was in place from 2020 to 2024. The speaker contextualised the regulation by comparing the 2017 Act with the predecessor Exchange Control Act of 1953, highlighting the shift from a punitive, state-controlled regime toward a liberalisation-oriented framework. He also identified several ongoing concerns — including unpredictability caused by frequent temporary orders, mandatory export proceeds conversion, and investment caps he considered insufficient — and benchmarked Sri Lanka's framework unfavourably against India's FEMA regime and Singapore's fully liberalised system, calling for further reforms to position Sri Lanka as a regional financial hub.

## Summary President Dissanayake addressed Parliament on the economic and social implications of the ongoing Middle East conflict for Sri Lanka, emphasising that while no country is immune to global instability, the government has adequate short-term mitigation plans in place. He provided detailed current fuel stockpile figures, citing approximately 33 days of diesel cover, 40 days of petrol cover, and 49 days of Jet A-1 cover, with multiple confirmed inbound supply vessels scheduled through the end of March. To address the country's primary vulnerability — insufficient storage capacity — he outlined a series of infrastructure investments totalling several billion rupees, including expansion of the Kolonnawa and Muthurajawela tank farms, rehabilitation of Trincomalee storage tanks, a new Jet A-1 pipeline to Katunayake, and an Expression of Interest process to double the capacity of the Sapugaskanda refinery from 50,000 to 100,000 barrels per day. He acknowledged public anxiety rooted in recent memories of the 2022 fuel crisis and stated that practical assurances, not words alone, are required to prevent societal instability, while calling for a broader international commitment to peaceful resolution of the conflict.

## Summary Hon. (Dr.) Nalinda Jayatissa, responding on behalf of the Minister of Foreign Affairs, Foreign Employment and Tourism, provided a detailed ministerial answer regarding tourist destination development in the Puttalam District. The response identified 27 tourist sites in the district spanning religious, archaeological, wildlife, and coastal attractions, and confirmed that tourism development is not confined to a few locations but is being pursued nationwide. Key current initiatives include the North Western Province Tourism Master Plan (commenced 2025, due for completion 2026), a Rs. 55 million beach park project at Halawatha, road infrastructure improvements in Kalpitiya, and the deployment of 30 tourist guides specifically for the district. Proposed future projects include ADB-funded infrastructure development in the Kalpitiya kitesurfing zone, floating jetties for coral park access, development of the Eluvankulama entrance to Wilpattu National Park, and a proposal to declare Gangewadiya as a formal tourism zone.

Hon. Ajith Gihan posed a written question to the Minister of Foreign Affairs, Foreign Employment and Tourism regarding the underdevelopment of tourism in the Puttalam District. The member highlighted that tourist attractions in Sri Lanka are concentrated in only a few regions and that no programme has been established to develop Puttalam's tourism potential. He requested information on which tourist destinations have been identified in the district and what steps the government intends to take to develop the area as a tourist destination.

## Summary Hon. Hizbullah called on the Government to prioritise practical economic recovery measures, particularly for agriculture and fisheries sectors devastated by the recent "Ditva" cyclone and floods. He highlighted that affected fishermen in the North, East, Anuradhapura, Polonnaruwa, and Ampara districts have received no meaningful relief — including nets, boats, fertilizer, seed paddy, or fuel subsidies — while vegetable farmers in Nuwara Eliya, Kandy, and Matale have similarly been overlooked. Citing high wholesale vegetable prices and the agricultural competitiveness of neighbouring countries such as India, he urged the Deputy Minister of Finance to develop concrete programs to reduce electricity costs for agriculture and agro-processing and to create a secure, investor-friendly environment to attract foreign investment. He concluded by urging a shift away from partisan bickering toward collaborative, forward-looking national development initiatives.

Hon. Lal Premanath delivered a speech praising the current government's governance record, citing recognition from international institutions such as the World Bank and IMF as evidence of improved fiscal transparency and integrity. He argued that the administration has strengthened the relationship between citizens and government, and pointed to expressions of solidarity from neighbouring countries India and Pakistan through trade and sports as indicators of Sri Lanka's restored stability. The speaker characterised the country's recovery from crisis as a demonstration that transparency leads to progress, framing the government's achievements as an expression of public will.

## Summary Minister Vijitha Herath defended the government's declaration of a state of emergency following Cyclone Dithwa, arguing it was necessitated by the inadequacy of the Disaster Management Act and the seven-year lapse in convening the National Council for Disaster Management, which had rendered normal statutory procedures inoperable. He explained that emergency powers were essential to enable cross-boundary deployment of military, police, and equipment from distant districts to areas with severed road access, which would have been legally impossible under ordinary administrative rules. The Minister rejected opposition claims that emergency powers had been used to suppress protests or media freedom, citing ongoing doctor strikes and daily media criticism as evidence, and noted that parliamentary privilege matters fall under Standing Orders rather than emergency regulations. He also reported record tourist arrivals of 277,000 in January despite cyclone damage, attributed partly to emergency-enabled designation of tourism as an essential service, and cited a World Bank interim estimate of USD 4.1 billion in economic damage from the disaster.