Modi’s visit, a ‘channel change’ from the Central Bank’s bondgate fiasco


Prime Minister Modi and President Sirisena

by Rajan Philips

Changing the channel in North American parlance means a government, or political organization, trying to inject a positive news story in the media to divert public attention from a negative news story that is dominating the news channels. So Modi’s visit was a channel changing opportunity after the UNP section of the yahapalanaya government had gone and bought itself a bondgate, courtesy of the Central Bank. In his address to parliament, Prime Minister Modi appealed to the government, and to the country, for "an early and full implementation of the 13th Amendment and going beyond it". Prime Minister Modi will also be visiting Jaffna on this trip, the first Indian Prime Minister to do so. In his meeting with the TNA leaders in Colombo, he advised them to work positively to facilitate the ‘change’ that has begun in Sri Lanka under President Sirisena. He asked the TNA ‘think tank’ to come up with new strategies for engaging the government. He is also reported to have told them not to ‘derail the process’, which is good advice and one that he should more appropriately offer in Jaffna to the resolution-happy Northern Provincial Council.

India is also hitching these political appeals to economic and cultural initiatives in the South, North, East and West of the island. A common feature of the two meetings in Delhi and in Colombo between Prime Minister Modi and President Sirisena was the emphasis on trade and economic agreements and initiatives between the two countries. These are welcome changes that the new government in Colombo should take advantage of. The question is whether the yahapalanaya government is steady and stable enough to take advantage of these initiatives in fulfilling its own 100-day agenda it promised to the people. While it has restored Sri Lanka’s friendly relations with India and reputation internationally, the new government is not navigating the domestic political waters quite as well.

Goodbye Port City, Hello Central Bank

Present day politics is all about optics. In the business of good governance, if there is something more important than not doing the wrong thing, it is not being seen or perceived to be doing the wrong thing. And in both optics and substance, the new government has got into a self-destructing - one step forward and two step backward – political trot. After managing to put Port City on hold, the government has gone and bought itself a bondgate at the Central Bank (after Nixon’s Watergate, any government scandal anywhere is now ‘gate’ tagged). When Basil Rajapaksa and his ilk began plotting the impeachment of Chief Justice Shiranee Bandaranayaka, President Rajapksa is said to have remarked, "this could come back to hurt us." It took a while, but retribution did come, and it came with vengeance. If and when the new government that benefitted from that wave of retribution gets its own comeuppance, government leaders can rue the ‘bondgate’ scandal sprung by the Central Bank as being one of the triggers of its downfall. Quite apart from the technical and evidentiary determination whether or not any bond trader did receive and benefit from inside information, the political judgement in the appointment of the Central Bank governor was questionable from the very beginning. Even now, rather than cutting itself loose from the bondgate scandal by asking the technically highly qualified but politically toxic governor to kindly vacate his post, the government is trying to save face by appointing a committee that has no credibility with anybody.

The people defeated the Rajapaksas to punish them for their corruption and family bandyism. They will not tolerate the new government shifting gears to do favours to fair-weather political friends instead of family members. There is a perception that Prime Minister Wickremasinghe is trying to continue from where he left as Prime Minister in 2004, and that, if correct, would be a huge mistake. In addition, bringing the Central Bank under the Prime Minister’s portfolio and appointing a governor from outside the Bank without an open and competitive selection process is not consistent with the expectations of good governance, but a continuation of Rajapaksa governance. The proposed 19th Amendment provides for the establishment of a Constitutional Council that is to be tasked, among other things, with making recommendations for and/or approvals of a host senior state and judicial officials, including the Chief Justice, the Auditor General, the Election Commissioner, etc. In the draft amendment, the Governor of the Central Bank is not included in the list of appointments under the purview of the Constitutional Council. Perhaps, it is time to add the Central Bank Governor’s appointment to the Council’s list.

What is new?

One step forward and more than two steps backward – is what the people are seeing in the new government’s investigation of its predecessor over widespread allegations of bribery, corruption and other criminal activities. It takes time and due process to identify and prosecute the perpetrators. People get that, but what they do not get is why the police should be asking political leaders for permission to arrest somebody. No one should be arrested on political orders, nor should anybody be not arrested for political expediency. There have also been news reports that a former Attorney General and a Minister in the present government have told lawyers in the Attorney General’s Department to ‘go slow’ on the investigations against specific individuals. In a not so strange twist, the SLFP parliamentarians are said to be complaining that the UNP ministers are not moving aggressively in investigating the Rajapaksas. Could it be that the SLFP parliamentarians are opposed to an early election in order to complete the investigations against the Rajapaksas, while the UNP is insisting on dissolving parliament on April 23 to scupper the investigations and even trigger a split in the SLFP? Either way, such machinations are not in keeping with the promises and expectations of good governance.

Take the dissolution dance. The President went out of his way to consult with the Commissioner of Elections and the Surveyor General about expediting electoral delimitation to conduct the next parliamentary under a new system of election laws. Their consensus is that rather than dissolving parliament on April 23 and having elections under the current PR/preferential system which nobody likes, just by postponing everything by a month or so the elections could be held under a new system. Give the President credit for trying to reach a compromise, even though, along Sobitha Thero and others, I would still argue that the current parliament should be allowed to complete its term ending in April 2016. That will also give time to make progress in at least implementing 13A, even if not going beyond it. Making early progress on 13A and implementing the LLRC recommendations would be helpful when Sri Lanka has to again stand before UNHRC in Geneva, in September 2015.

But what does the UNP Working Committee do after the President’s positive intervention? It resolves unanimously that parliament shall be dissolved on April 23, for elections in June this year. It may not have been intended as a snub to the President, but what was the point in passing a resolution that will have no effect on the President, or the Parliament, unless the Working Committee was taking a leaf from the Northern Provincial Council’s enthusiasm for resolutions? The SLFP group in parliament is starting its own game of constitutional hide and seek. It is fair for the SLFP to insist that electoral reforms should be in place before the next election, but it would be farfetched for that Party to come forward with its own constitutional proposals now after following the Rajapaksas for ten years without taking any constitutional initiative whatsoever except passing the wretched 18th Amendment.

So what is new? What is new and what is different is the purpose and persistence that is being demonstrated by the JVP and the JHU, who unlike the UNPers and the SLFPers have no skeletons to hide and have no IOUs to (dis)honour. What is also new and different is that President Maithripala Sirisena, unlike his predecessors, seems sincere and honest in his determination to keep the promises he made to the people en route to his victory on January 8. He will increasingly find himself to be at odds with both the SLFP and UNP parliamentarians, and to overcome their petty machinations he will have to rely on the political energies of the JVP and the JHU in the south, and the TNA in the north. Occasionally, he will have to directly connect with the people over the heads of the parliamentarians.

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