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Sri Lanka recorded a notable decline in marriages in 2024, according to the latest data from the Department of Census and Statistics.

A total of 139,290 marriages were registered in 2024, marking an 8 percent decrease from 2023, the data showed.

In 2022, the year of the economic crisis, 171,140 marriages were registered across the country.

Earlier, official data showed a sharp fall in births. According to the statistical agency, 220,761 births were recorded in 2024, compared to 301,706 in 2020.

(Source - Xinhua)

Sri Lanka’s contentious e-visa system has come under renewed scrutiny as the Department of Immigration and Emigration’s special audit report was officially presented to Members of Parliament this week. The report, compiled by Acting Auditor General G.H.D. Dharmapala, reveals serious lapses in financial accountability, legal compliance, and procurement transparency surrounding the multimillion-dollar e-visa contract awarded to a foreign private company.

Speaking in Parliament, Committee on Public Finance (CoPF) Chairman Dr. Harsha de Silva confirmed that MPs had received the special audit report, which includes nine key recommendations to rectify the issues and restore public trust in the visa issuance process. He urged that the recommendations be implemented without delay, noting that the controversy has severely tarnished the image of the country’s border control system.

The Auditor General’s report calls for a comprehensive review of the outsourcing arrangements, urging authorities to determine their legality under the Immigration and Emigration Act of 1948. It also recommends investigations into officials who approved and implemented the project without the involvement of the Finance Ministry or Treasury oversight, particularly in relation to visa revenue being collected in foreign bank accounts.

The report highlights the absence of competitive bidding, weak contractual safeguards, and a lack of cost-effectiveness studies before awarding the contract. It calls for immediate recovery of any losses incurred by the government and insists that future service providers must be selected through a transparent, competitive tender process once ongoing court proceedings are concluded.

The e-visa system, introduced in late 2023, was intended to streamline Sri Lanka’s entry procedures for tourists and business travelers through online processing. However, the project quickly became mired in controversy after revelations that visa fees were being charged in U.S. dollars and collected through a private entity’s overseas account without full government supervision. Public backlash led the authorities to suspend the system temporarily earlier this year, reverting to the previous visa-on-arrival and ETA platforms while investigations continued.

The Auditor General’s findings have revived the debate over digital governance and public-private partnerships in critical state functions. The report stresses that all future contracts must comply with Sri Lankan tax regulations, ensure data protection, and guarantee that all revenue is properly remitted to the state.

While the audit was limited to available evidence, it recommends referring potential unlawful acts to specialized investigative agencies. The controversy, which has already led to several administrative transfers within the Immigration Department, is expected to shape the government’s broader approach to e-governance reforms in the coming months.

Margin loans issued by Sri Lanka’s banking sector have surged by nearly 25 percent—from Rs. 48 billion in January to Rs. 60 billion by August 2025 raising fresh concerns about growing speculative exposure in the financial system. The Central Bank’s latest Financial Stability Review confirms this increase, even as authorities attempt to balance post-crisis recovery with financial discipline.

According to B.H.P.K. Thilakaweera, Director of the Central Bank’s Macroprudential Surveillance Department, the sharp rise in margin lending reflects both investor optimism and increasing credit appetite amid a rebounding economy. Although Central Bank Governor Dr. Nandalal Weerasinghe downplayed the risk stating that margin credit remains a small share of total banking sector lending—analysts warn that the pace of growth could signal emerging vulnerabilities.

Margin loans, which allow investors to borrow against their equity portfolios to buy more shares, have historically amplified market cycles in frontier economies. With the Colombo Stock Exchange (CSE) rallying on the back of improved earnings, falling inflation, and restored investor confidence, the risk of over-leverage has increased. The Central Bank report notes that stock market volatility, measured by the 20-day moving standard deviation, has already exceeded 2024 averages, peaking in January 2025 the highest level since April 2022.

Such volatility, coupled with a sharp increase in leveraged positions, could expose both investors and banks to severe losses if markets correct sharply. The Review also highlights elevated geopolitical tensions ranging from global trade disputes to armed conflicts that have further intensified risk levels.

Economists caution that a sustained rise in margin lending without commensurate oversight could threaten broader financial stability. While corporate earnings and improved liquidity have driven a bullish sentiment, the same optimism may lead to speculative excesses if not closely monitored.

For depositors, the concern lies in potential contagion. If stock market corrections trigger defaults on margin loans, banks could face balance sheet pressures, particularly smaller ones with limited capital buffers. This, in turn, may weaken depositor confidence especially in a country with a history of monetary instability and periodic financial shocks.

The Central Bank faces a delicate policy challenge: supporting capital market growth while preventing excessive risk-taking. Experts suggest tightening margin lending guidelines, imposing higher risk weights on equity-backed loans, and enhancing transparency on exposure levels across financial institutions.

Sri Lanka’s experience underscores the fine line between economic recovery and speculative overheating. As the nation rebuilds confidence after years of instability, maintaining macroprudential discipline will be key to avoiding another cycle of financial distress.

Japan is quietly strengthening its economic footprint in Sri Lanka as both countries explore a deeper industrial partnership aimed at turning the island into a strategic supply base for Japanese manufacturing operations in India and the wider South Asian region.

The Board of Investment (BOI) is currently collaborating with the Japan External Trade Organization (JETRO) to attract new Japanese investors and create a specialized Japan–Sri Lanka Investment Zone. According to BOI Chairman Arjuna Herath, discussions are also underway on developing an India–Sri Lanka Economic Corridor to integrate regional value chains.

Japan’s renewed interest comes amid a global shift in supply chains. Many Japanese manufacturers, heavily invested in India, are now exploring Sri Lanka as a cost-effective alternative for sourcing intermediate goods, logistics, and light manufacturing. “They are considering whether Sri Lanka can act as a supply source to support their Indian operations,” Herath said, noting that several Japanese firms have initiated feasibility assessments within BOI zones.

At present, nearly 85 Japanese companies operate under the BOI framework in Sri Lanka, primarily engaged in automotive components, tire manufacturing, electronics, precision engineering, and construction material production. These firms collectively account for around 12% of annual FDI inflows from Asia, contributing an estimated US$ 120–150 million per year in direct investments and reinvested earnings.

Prominent Japanese investments include Michelin Lanka Pvt Ltd, which expanded its Sri Lankan operations with an additional US$ 72 million from its parent company, and CEAT OHT Lanka Pvt Ltd, a joint venture with a Japanese partner, which committed US$ 111 million to a state-of-the-art tire manufacturing plant. Other notable Japanese-linked ventures operate in renewable energy, industrial automation, and high-tech logistics services.

The BOI has recorded a marked resurgence in foreign investment confidence. Between January and September 2025, it approved 104 projects with total capital investment of US$ 1.06 billion, split almost equally between foreign (US$ 540 million) and local (US$ 520 million) participation.

The breakdown of realized FDI shows equity inflows of US$ 133 million, reinvested profits of US$ 132 million, and intra-company loans of US$ 231 million. Long-term foreign commercial loans amounted to US$ 331 million, bringing total realized investment up 138% compared to 2024.

The Colombo West International Terminal (CWIT) was the single largest investment during the period, injecting US$ 229 million, followed by CEAT OHT’s US$ 111 million and Bluehaven Services’ US$ 85 million for the City of Dreams resort development.

BOI expects total foreign direct investments including new projects, reinvestments, and borrowings to reach US$ 1.1 billion in 2025, driven largely by renewed investor confidence, policy reforms, and improved credit ratings.

Herath emphasized that “the strong participation of existing enterprises reflects the trust built through economic and political stability, transparency, and good governance.”

With JETRO’s involvement and growing Japanese investor interest, Sri Lanka’s next growth frontier may hinge on how quickly it positions itself as a dependable link in Japan’s regional manufacturing and supply chain ecosystem.

Sri Lanka’s Commission to Investigate Allegations of Bribery or Corruption (CIABOC) has recorded its most active year in nearly a decade, marking a historic surge in arrests, convictions, and public engagement. The latest performance data shows a sharp rise in enforcement actions that began in 2024 and has carried into 2025, reflecting the growing impact of the Anti-Corruption Act, No. 9 of 2023.

CIABOC’s intensified campaign has shifted beyond traditional bribery cases to tackle large-scale corruption and misconduct involving high-ranking public officials and political figures. The Commission said its mission now prioritises robust law enforcement, prevention, and transparency to strengthen governance and public accountability.

In 2024, CIABOC conducted 53 successful raids  the highest in years  compared to 43 in 2023 and 32 in 2022. These operations led to 86 arrests, up from 57 the previous year. The momentum remains strong in 2025, with 27 raids and 34 arrests in just the first six months.

While bribery remains central to CIABOC’s operations, the agency has widened its reach into more complex corruption cases. In 2024, the Commission filed 83 cases, 70 of which were bribery-related. During the first half of 2025, 15 of the 50 filed cases were corruption-related — nearly matching the highest annual record of such cases in 2022. For the first time, cases involving illicit enrichment and non-declaration of assets have begun to emerge under the new legal framework.

A notable trend has been the prosecution of senior officials and political leaders. Among those arrested in the first half of 2025 were a former Minister of Health and Mass Media, a former Minister of Sports, a former Chief Minister and Chief Secretary of the Uva Province, and a former Opposition Leader of the Central Provincial Council. High-profile arrests also included senior officers from the Department of Motor Traffic, SriLankan Airlines, and even a neurosurgeon.

Convictions have similarly climbed to their highest level since 2015. Thirty individuals were convicted in 2024 including a former Minister of Disaster Management and senior Customs and Railway officials while 24 convictions were recorded in the first half of 2025. Those convicted this year include a former Chief Minister, a former Minister of Sports, and a former MP who also chaired Lanka Sathosa.

CIABOC attributes this momentum to greater public engagement following the 2023 Act. A record 4,267 complaints were lodged in 2024, with another 3,022 received in the first half of 2025. Meanwhile, the Prevention Division has conducted 139 awareness programmes in 2024 and 113 this year, targeting public institutions, private firms, and schools.

The Commission is also supporting the creation of Internal Affairs Units within ministries and State bodies to enhance internal oversight and curb corruption from within.

Sri Lanka’s financial institutions are witnessing a sharp rise in vehicle-backed loans in 2025, igniting fresh concern among analysts and regulators over growing credit exposure and potential threats to financial stability. The surge driven by renewed consumer demand, relaxed import restrictions, and aggressive lending campaigns has made vehicle loans one of the fastest-growing segments of the post-crisis credit market.

According to data from the Central Bank and industry sources, vehicle loans have expanded by over 30% this year alone. While this growth has temporarily boosted the automotive and leasing sectors, it also exposes banks and finance companies to heightened credit and liquidity risks. Experts warn that unless carefully managed, this trend could erode asset quality and depositors’ confidence echoing the early signs of previous financial imbalances.

Vehicle loans are typically consumption-based and depend heavily on borrowers’ income stability. Many of these borrowers work in the informal or gig economy, where earnings fluctuate. Although interest rates have eased, repayment capacity remains fragile. A sudden increase in rates or a slowdown in household income growth could quickly trigger defaults, especially as vehicle collateral depreciates far more rapidly than real estate or equity assets.

Analysts caution that the sector is showing early symptoms of credit overheating. During the 2018–2019 credit expansion, vehicle loans contributed significantly to non-performing loans (NPLs) when consumer spending cooled. The Central Bank’s Financial Stability Review has already identified asset-backed lending particularly in vehicles as an area requiring closer scrutiny and stricter prudential standards.

For depositors, the implications are indirect but critical. If financial institutions face rising defaults, pressure on capital buffers and liquidity could spread to the broader banking network, undermining depositor trust. This concern is particularly relevant for smaller finance and leasing companies that rely heavily on short-term deposits to fund their lending portfolios.

Some analysts also question whether certain lenders are overstating asset valuations or underestimating borrower risk to achieve lending targets. Such practices could distort financial statements and conceal underlying vulnerabilities.

To avert potential instability, experts urge the Central Bank of Sri Lanka to tighten loan-to-value (LTV) ratios, enforce enhanced risk-weighting on vehicle-backed assets, and conduct targeted stress tests on vehicle loan portfolios. Strengthening credit assessment frameworks and ensuring transparent reporting of sector-specific NPLs are seen as crucial steps to prevent systemic exposure.

As Sri Lanka’s economy stabilizes after years of turbulence, the Central Bank faces the challenge of balancing credit growth with prudence. Without swift and coordinated regulatory action, the ongoing boom in vehicle loans could turn into the next stress point for the country’s financial institutions, threatening both profitability and public confidence.

Sri Lanka’s long-promised leap into electric mobility has hit a legal speed bump as the Court of Appeal this week ordered Sri Lanka Customs to expedite its investigation into the controversial detention of BYD electric vehicles imported by John Keells CG Auto Ltd. (JKCG), a joint venture between Sri Lanka’s blue-chip conglomerate John Keells Holdings PLC and Nepal’s Chaudhary Group (CG Corp Global).

During Thursday’s hearing, Court of Appeal President Justice Rohantha Abeysuriya stressed that while Customs plays a crucial role in revenue collection, the interests of consumers and importers must also be safeguarded. The court directed Customs to swiftly conclude its probe into the vehicles’ engine (motor) capacity and urged all parties to cooperate.

The dispute erupted after Sri Lanka Customs detained several shipments of BYD electric vehicles, alleging that their motor power had been under-declared to reduce import duties. John Keells CG Auto filed a writ petition seeking the release of around 1,000 vehicles held at the port. In August 2025, the court allowed conditional release upon submission of a bank guarantee of about Rs. 3.6 billion and cooperation with an independent technical committee.

Additional Solicitor General Sumathi Dharmawardena, appearing for Customs, informed the court that the vehicles could be released under a company bond, while a detailed report on the scanning equipment used for inspection would be presented next week. However, President’s Counsel Farzana Jameel, representing JKCG, argued that the detention was unlawful. The court will revisit the case on October 28 to consider possible settlement terms.

Meanwhile, John Keells CG Auto issued a public statement clarifying that none of the recalled BYD Tang or Yuan Pro models had been sold in Sri Lanka. The recall, announced by BYD in China, affected vehicles manufactured between 2015 and 2022, but not those imported locally. JKCG emphasized that all BYD units sold in Sri Lanka carry full manufacturer warranties and after-sales support from trained technicians.

The case has drawn attention to Sri Lanka’s fragile regulatory environment for electric vehicles. The BYD venture, launched in 2024 as a major green initiative, was expected to revolutionize the country’s EV market with showrooms in Colombo, Kurunegala, Ratnapura, and Ampara. Yet, the customs controversy has stalled deliveries and cast a shadow over the project.

The controversy also echoes past regulatory challenges faced by CG Motors in Nepal, where the company was accused of tax manipulation in 2023. Combined with Chaudhary Group’s acquisition of Union Bank of Colombo through offshore channels, questions have surfaced about governance and transparency.

As Sri Lanka pushes toward sustainable transport, the BYD case underscores a broader issue — balancing investor confidence, regulatory scrutiny, and public accountability in the country’s emerging EV landscape.

Sri Lanka’s preferential access to the European Union market under the GSP+ trade facility is facing a serious threat as Brussels prepares for its next review of the scheme. Once considered a diplomatic success that opened doors for exports worth billions, the GSP+ concession is now at risk due to what analysts describe as the government’s weak and uncoordinated foreign policy handling and the poor communication skills of ministers overseeing external relations.

Since 2017, GSP+ has allowed Sri Lanka duty-free access to the EU for over 66% of tariff lines—vital for the garment, rubber, spice, and seafood industries. But the scheme requires strict compliance with 27 international conventions on human rights, labour standards, environmental protection, and governance. The EU’s upcoming regulatory overhaul will expand these to 33, adding new conventions on organized crime, climate change, disability rights, and labour inspection.

While these changes are meant to standardize global compliance, the process has become more rigorous and politically sensitive. EU officials now expect detailed implementation timetables and verifiable reforms. In Colombo, however, senior diplomats and trade analysts warn that the government has failed to engage Brussels effectively. Poorly briefed ministers, ad-hoc responses to EU inquiries, and internal policy confusion have all contributed to the perception that Sri Lanka’s compliance is more rhetorical than real.

The Prevention of Terrorism Act (PTA) remains a sticking point. Despite limited reforms, the EU continues to express concern over due process and arbitrary detention. Officials in Brussels have also flagged the slow pace of reconciliation, minority protection, and governance reforms, areas long tied to the GSP+ monitoring process. “Implementation must go beyond promises on paper,” one EU source said, warning that political backsliding could jeopardize trade privileges.

The stakes are high. The apparel sector, which employs nearly one million people directly and indirectly, depends heavily on GSP+ for tariff-free access to its largest export market. Losing this facility estimated to save exporters over €500 million annually would not only shrink export revenues but also dampen investor confidence and weaken post-crisis economic recovery.

Experts argue that Sri Lanka’s diplomatic machinery has become fragmented. Instead of proactive, strategic engagement with the EU, officials often rely on last-minute lobbying. This lack of professionalism, coupled with the absence of clear communication from the Foreign and Trade ministries, has created an impression of amateurism and policy drift at a time when credibility matters most.

Unless the government undertakes urgent, well-coordinated diplomatic engagement and demonstrates real progress in human rights, environmental protection, and governance reforms, Sri Lanka could find itself once again suspended from the GSP+ facility repeating the costly mistake of 2010.

Following the entry of new international fuel operators, the Ceylon Petroleum Corporation (CPC) experienced a significant financial setback in 2024 due to a reduction in its market share. According to a report issued by the Ministry of Finance, Economic Stabilization and National Policies, the corporation’s revenue has dropped by 26.9%.

In 2023, the CPC recorded a revenue of Rs. 1,263.6 billion. However, in 2024, this revenue fell by 26.9% to Rs. 923.4 billion, the report states.

The sales volume in 2023 was 4,184 million liters of fuel. In 2024, this figure dropped by 286 million liters. The corporation's gross profit also declined by 53.4%, down to Rs. 75.6 billion in the past year.

However, due to the continuous application of the cost-reflective pricing formula and the relative strengthening of the Sri Lankan Rupee during the year, the corporation still managed to record a net profit of Rs. 33.3 billion.

Opposition MP Jagath Vithane told Parliament today that he is facing a death threat and it has been confirmed by the Inspector General of Police (IGP) as well.

Vithane said the IGP has informed the Kalutara SSP to take action on the plot to kill him.

He said the plan is to kill him while he is coming out of his residence.

The MP therefore urged Speaker Jagath Wickramaratne to take steps with regard to the threat.

Deputy Speaker Rizvi Salih who was in the chair assured that the matter will be brought to the attention of the Speaker.

(Source - Dailymirror)