The Committee on Public Finance (CoPF) has approved a Rs. 71.7 billion relief package under Supplementary Estimate No. 03 of 2026 to support communities impacted by the economic fallout of the Middle East conflict. 

Meeting in Parliament on 28 July under the chairmanship of MP Harsha de Silva, the Committee reviewed allocations across fuel, electricity, agriculture, fisheries, and social welfare, while stressing that the package represents a reallocation of existing budgetary provisions rather than an increase in expenditure or borrowing limits.

During the discussion, it was revealed that the largest allocation under the Rs. 71.7 billion relief package, amounting to Rs. 52.8 billion, has been earmarked for the petroleum sector. Officials informed the Committee that the allocation was made to offset potential losses arising from increased fuel landing costs and to ensure the uninterrupted supply of fuel, thereby preventing possible shortages in the country.

Officials further explained that the Rs. 71.7 billion allocation consists of two components. The first is Rs. 52.8 billion reallocated to settle payments relating to relief measures, including fuel subsidies provided during May and June 2026. The second is Rs. 18.9 billion reallocated to replenish the annual budget contingency reserve, which had been utilized to finance the April 2026 fuel subsidy for the Ceylon Petroleum Corporation and other fuel suppliers, fertilizer subsidies for smallholder tea growers, and assistance provided to the fisheries sector.

The Committee was informed that, similar to the Rs. 20 billion Supplementary Estimate reviewed on 11 June 2026, this request would not increase either the expenditure ceiling or the borrowing limit for 2026. It was clarified that the proposal represents only a reallocation of already approved budgetary provisions.

It was also disclosed that the entire Rs. 71.7 billion allocation will be financed from the unutilized balance of the Rs. 500 billion Supplementary Estimate No. 01 of 2026, which had been allocated for relief and recovery measures following Cyclone Ditwah. As at 30 June 2026, only Rs. 243.9 billion of that allocation had been utilized.

Accordingly, the Committee noted that the fuel subsidy should be viewed as a consumer relief measure rather than a subsidy granted to fuel companies, and that it is a temporary intervention introduced in response to the prevailing circumstances.

The Committee was further informed that fuel suppliers, including the Ceylon Petroleum Corporation, received subsidies amounting to approximately Rs. 20,507 million for April 2026 alone. Of this amount, Rs. 15,000 million was allocated to the Ceylon Petroleum Corporation, Rs. 2,340 million to Lanka IOC PLC, Rs. 1,501 million to Sinopec, and Rs. 1,666 million to RM Parks.

The Committee also discussed the overall distribution of the Rs. 71.7 billion relief package, under which Rs. 15 billion has been allocated to the Ceylon Electricity Board, Rs. 8.2 billion for the Aswesuma programme, Rs. 3 billion to support agricultural activities during the Yala cultivation season, Rs. 2.2 billion for smallholder plantation farmers, and Rs. 1.2 billion for the fisheries sector.

The Road Development Authority also briefed the Committee on the progress of projects undertaken following the damage caused by Cyclone Ditwah. Officials stated that the Governments of India and China have pledged assistance for the reconstruction of damaged bridges. They further informed the Committee that construction of the Galagedara and Rambukkana interchanges of the Central Expressway is expected to be completed by the end of 2028. It was also noted that tenders have already been called for the electricity supply system for the expressways and that work is expected to commence within the next three months.

The Committee also discussed the potential impact of the El Niño phenomenon. Chair of the Committee, MP Harsha de Silva, emphasized the importance of strengthening the Disaster Management Statutory Fund to enable the country to respond more effectively to future climate-related events.

In addition, the Committee held an extensive discussion on the determination of the salary of the Auditor General. Views were also exchanged on matters relating to the public sector salary structure. The Committee decided to continue deliberations on these matters at a future meeting before reaching a final decision. (Newswire)

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The Asian Development Bank (ADB) has moved swiftly with $4 billion in financing to help countries withstand the economic shocks of the Middle East conflict, with Sri Lanka among 15 governments that have formally requested assistance.

According to the ADB, the financing includes about $3 billion requested by governments and $1 billion provided as trade finance for energy and food imports.

Sri Lanka’s request, alongside those from Bangladesh, Fiji, and the Philippines, forms part of a broader package announced by ADB in late March. 

“ADB has received formal requests for support from 15 affected governments across the region, including previously announced requests from Bangladesh, Fiji, the Philippines, and Sri Lanka. The requests, which follow a financial support package announced by ADB in late March, range in size from $15 million to $1.5 billion and include policy-based loans, countercyclical financing, rapid repurposing of existing sovereign portfolio funds, and emergency assistance loans. ADB is in discussions with an additional 4 countries facing continued impacts on their economies,” The ADB said in a statement.

The support ranges from policy-based loans and countercyclical financing to rapid repurposing of existing sovereign portfolio funds and emergency assistance loans.

“The bank is deploying its full suite of crisis response instruments, including budget support, trade finance, and a new mechanism to rapidly repurpose existing portfolio funds, to deliver tailored and timely support to our members, from large to small, who need to safeguard their economies and communities,” ADB President Masato Kanda said.

For Sri Lanka, the financing is expected to help cushion pressures on tourism, remittances, and fuel supplies, while supporting fiscal stability amid global uncertainty.

Full statement:

The Asian Development Bank (ADB) is acting quickly and decisively with $4 billion in financing to help countries withstand the impact of the Middle East conflict, including about $3 billion requested by governments and $1 billion provided as trade finance for energy and food imports.

“ADB is acting with speed and scale to support countries experiencing a range of impacts from the Middle East conflict, including pressure on finances, remittances, tourism, and fuel and fertilizer supplies,” said ADB President Masato Kanda. “At this time of acute uncertainty and risk, we are deploying our full suite of crisis response instruments—including budget support, trade finance, and a new mechanism to rapidly repurpose existing portfolio funds—to deliver the tailored and timely support our members, from large to small, need to safeguard their economies and communities.”

ADB has received formal requests for support from 15 affected governments across the region, including previously announced requests from Bangladesh, Fiji, the Philippines, and Sri Lanka. The requests, which follow a financial support package announced by ADB in late March, range in size from $15 million to $1.5 billion and include policy-based loans, countercyclical financing, rapid repurposing of existing sovereign portfolio funds, and emergency assistance loans. ADB is in discussions with an additional 4 countries facing continued impacts on their economies.

In addition to these requests, the Government of India has requested $1.5 billion in ADB financing to build and accelerate resilience and to sustain reform-based urban transformation and clean energy objectives. The proposed assistance includes a $1 billion policy-based loan under the Urban Transformation and Investment Program to sustain momentum in urban infrastructure investment and reforms, and $500 million under the Accelerating Affordable and Inclusive Rooftop Solar Systems Development Program to expand clean energy access, reduce dependence on imported fuels, strengthen domestic manufacturing, install battery energy storage systems, promote circular economy initiatives, and enhance long-term energy security.

Complementing this sovereign assistance, ADB has reactivated support for oil imports under its Trade and Supply Chain Finance Program (TSCFP) on an exceptional basis for a limited period to soften the impact of rising oil prices and supply chain disruptions. Since 1 March, ADB’s TSCFP has delivered $673 million to support oil and gas imports and $390 million for food security across 9 countries, helping maintain access to essential supplies amid global market disruptions. Trade finance support to the Cook Islands is also expected to commence soon as part of ADB’s broader support for vulnerable small island developing states.

ADB also stands ready to support Vanuatu through its Rapid Resource Reprogramming and Deployment Option (3RDO), a new financing mechanism that enables swift repurposing of ADB portfolio funds to support immediate relief and early recovery actions. The government has expressed strong interest in operationalizing the 3RDO, not only to meet immediate financing needs arising from the current fuel crisis but also to establish a readily available contingency mechanism that can be activated in response to future crises.

ADB is a leading multilateral development bank supporting sustainable, inclusive, and resilient growth across Asia and the Pacific. Working with its members and partners to solve complex challenges together, ADB harnesses innovative financial tools and strategic partnerships to transform lives, build quality infrastructure, and safeguard our planet. Founded in 1966, ADB is owned by 69 members—50 from the region. (Newswire)

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Iran’s Islamic Revolutionary Guard Corps (IRGC) said they launched an attack targeting an American air base, which they say was the source of US strikes on Iranian targets early Thursday local time, state-linked Iranian media reported.

The IRGC did not specify which air base it targeted. The US has air bases in a number of nations in the Middle East region.

“Following the aggression carried out at dawn today by the invading US military against a location on the outskirts of Bandar Abbas Airport using aerial projectiles, the American air base identified as the source of the attack was targeted at 4:50 a.m.,” Fars News Agency reported, citing a statement from the IRGC’s public relations office.

The IRGC said its response was “a serious warning” to the US, saying its “aggression will not go unanswered.”

Around the same time Iran said the attack was launched, Kuwait’s Army reported its air defences were intercepting “hostile” drones and missiles, though it did not state the origin of the attacks.

In the early hours of Thursday morning local time, three explosions were heard to the east of Bandar Abbas, a strategic Iranian port city and naval base near the Strait of Hormuz. 

A US official confirmed the US military had shot down four Iranian drones and struck an Iranian ground control station in Bandar Abbas that was about to launch a fifth drone. (CNN)

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Asia and the Pacific are facing mounting socio‑economic pressures as the ripple effects of the recent military escalation in the Middle East strain economies and households across the region, according to a new UNDP assessment.

A preliminary analysis released by the United Nations Development Programme (UNDP) reports that, despite a temporary ceasefire, heightened volatility in energy, trade, and labour markets is eroding incomes, jobs, and social protection systems.

The report warns that millions are at risk of falling into poverty, with women, low‑income households, migrants, and small enterprises among the most vulnerable.

The report synthesizes impact and needs assessments covering 36 countries, complemented by macroeconomic simulations, and provides a regionwide outlook as well as how different countries are currently responding to these pressures.

Rising fuel and freight costs are the most immediate pressure point.  With over 80 per cent of crude and LNG transiting the Strait of Hormuz destined for Asian markets, the region is experiencing rapid pass-through of higher pricing on transport, electricity, food and fertilizer.

The report estimates that 8.8 million people are at risk of falling into poverty. Output losses could range from US$97 billion to US$299 billion, equivalent to between 0.3 and 0.8 per cent of regional GDP.

In Iran, the estimated decline in the Human Development Index is equivalent to one to one and a half years of progress lost. In other countries, human development losses under a short‑duration scenario range from weeks to months of foregone development progress, but could escalate significantly if disruptions persist, particularly in economies reliant on remittances, imported energy and food. Losses are most pronounced in South Asia, reflecting higher exposure to income and price shocks and more limited policy buffers, while East and Southeast Asia experience comparatively smaller setbacks.

Governments across the region have responded rapidly to cushion the domestic shocks through fuel price stabilization, targeted subsidies, limits on transport, and early adaptive measures such as diversifying energy supply and improving energy efficiency. In some countries, responses have included nationwide energy saving campaigns and temporary changes to public‑sector work arrangements to ease pressure on fuel consumption and public budgets.

“The strain this war is placing across Asia-Pacific is already visible. It is reaching households faster than policy can adjust.  Despite the recent ceasefire, the resulting prolonged volatility in global markets is imposing increasingly difficult tradeoffs between stabilizing prices, supporting vulnerable households, and maintaining essential public services and market investments. At the same time, we see important opportunities for countries to accelerate long‑term resilience through adaptive social protection, stronger local and regional value chains, and diversified energy and food systems,” said Kanni Wignaraja, UN Assistant Secretary‑General and UNDP Regional Director for Asia and the Pacific.

The report is part of a series of socio-economic analyses produced by UNDP to support policymakers unpack the human development consequences of the current conflict, and identify options for a development response as a first line of defence.

“This is not about regular economic management measures, but a broader test of whether countries can look ahead and adapt fast to protect human development and human security gains in a far more volatile and insecure world,” Wignaraja said.

Full report : https://www.undp.org/asia-pacific/publications/military-escalation-middle-east-human-development-impacts-across-asia-and-pacific (Newswire)

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President Anura Kumara Dissanayake, meeting with the Council of Arab Ambassadors accredited to Sri Lanka at the Presidential Secretariat today (08), expressed Sri Lanka’s hope for the early restoration of peace in the Middle East.

During the discussion, the ambassadors briefed the President on the challenges faced by countries in the Middle East amid the prevailing conflict situation, particularly the threats posed to peace, security, and stability in the region.

According to the President’s Office, President Dissanayake also expressed concern over attacks targeting countries in the region that are not directly involved in the conflict, and firmly stated that such attacks are not condoned under any circumstances.

President Anura Kumara Dissanayake further expressed appreciation for the support extended to Sri Lanka by Middle Eastern countries, especially their contributions towards meeting energy requirements, as well as their role in providing foreign employment opportunities and supporting the tourism industry.

Noting that a large number of Sri Lankan workers are employed in Middle Eastern countries, the President also conveyed his gratitude for the attention given to ensuring their safety in the current conflict situation.

He further affirmed that Sri Lanka, both as an individual nation and collectively with others, will extend its fullest possible support, within the framework of international law, towards ensuring peace, security, and stability in the Middle East.

Among those present at the meeting were the Ambassador of the United Arab Emirates to Sri Lanka and Head of the Council of Arab Ambassadors, Khaled Nasser Sulaiman Al Ameri; Ambassador of Saudi Arabia, Khalid Hamoud Nasser Alkahtani; Ambassador of Oman, Ahmed Ali Saeed Al Rashdi; Ambassador of Egypt, Adel Ibrahim; Ambassador of Palestine, Ihab I.M. Khalil; Ambassador of Qatar, Hamad Mohammed Abdullah Al-Sanad Al-Dosari; Chargé d’Affaires of the Embassy of Iraq in Colombo, Anmar A.A. Al-Emin; Acting Chargé d’Affaires of the Embassy of Kuwait in Colombo, Abdullah A.M.A. Almuhana; and Chargé d’Affaires of the Libyan Embassy in Colombo, Faek B.T. Aboud.

Also in attendance were Minister of Labour and Deputy Minister of Finance and Planning, Dr Anil Jayantha Fernando; Governor of the Western Province, Hanif Yusoof; and Senior Additional Secretary to the President, Roshan Gamage. (Newswire)

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Countries around the world are facing a cliff-edge as the flow of liquefied natural gas from the Gulf comes to an abrupt end in the next 10 days, when a handful of final tankers from the region reach their destinations. 

Qatar, which produces a fifth of the world’s liquefied natural gas, had to stop exports after Iran blockaded the Strait of Hormuz at the mouth of the Gulf, in the first few days of the conflict. 

It has since suffered enormous damage to its giant Ras Laffan LNG plant, which was attacked by Iranian missiles this week, sending gas prices in Asia and Europe soaring. 

But many LNG carriers that loaded at Qatar and the United Arab Emirates were already on their way to destinations before the war started, according to analysis by independent shipbroker Affinity, meaning that some customers are only now about to feel the pain of lost supply. 

Countries reliant on imports to power their economies will have to pay sky-high prices to compete for LNG supplies from the US and elsewhere, switch to other fuels or force households and businesses to use less. 

Many oil and gas-poor Asian countries have already imposed measures to avoid shortages, such as four-day weeks.

Only one LNG cargo from the Gulf is still scheduled to arrive in Asia, which buys almost 90 per cent of the region’s output, according to ship-tracking data. Six LNG shipments are still due to arrive in Europe.

Final LNG tankers from the Gulf en route since the Strait of Hormuz closed

Pakistan is likely to turn to more expensive and dirtier furnace oil as much as possible to generate power if the conflict continues. Even so, “I see us having one very difficult year followed by two or three difficult years to follow”, said GasPort’s Ahmed.  

Bangladesh is vulnerable for similar reasons, but to a lesser extent because it receives some LNG from outside the Gulf. It would also struggle to pay sky-high prices to replace LNG it would otherwise have received from the Gulf, and lacks alternative fuels. The government has initiated gas-rationing measures, including closing universities. 

As one of the biggest buyers of LNG from the Gulf, Taiwan is grappling with the consequences of its attempt to shift from coal to cleaner-burning gas while phasing out nuclear energy before a full shift to renewables. It moved quickly to secure replacement cargoes immediately after the war broke out. 

On March 10, the Ministry of Economic Affairs said 22 cargoes from the Gulf had been secured, ensuring that there would be no supply concerns through to the end of April. Even so, electricity demand typically surges in the summer, raising the possibility of “severe energy shortages” if the Strait of Hormuz remains closed, said Kevin Li from the Atlantic Council’s Global Energy Center. 

China and Japan are also likely to buy some spot LNG cargoes to make up the shortfall from the Gulf, traders say. “Our plan is to buy in the spot market from JKM to cover supplies,” said one Japanese LNG trader. But traders and utilities are taking a wait-and-see approach and they plan to return to coal, they said. 

Japanese utilities are holding back on LNG purchases for now, another trader confirmed. “Only a few buyers are considering spot cargoes.” While Japan is the world’s second biggest LNG importer after China, it is less exposed to the disruption of flows from the Middle East as only 6 per cent of its supply passes through the Strait of Hormuz.  

China gets 30 per cent of its LNG from the Gulf but has some domestic gas production and can switch to coal-fired power generation if needed. 

Japan is also set to use more coal and nuclear to generate electricity. It partially restarted operations at the world’s largest nuclear plant in the prefecture of Niigata in January.

Until more ships are allowed to pass through the Strait of Hormuz, global LNG supplies will remain tight. 

Even then, there will be less available to the market because 17 per cent of Qatar’s LNG capacity will continue to be out of service for between three and five years because of the attacks on Ras Laffan, the country’s energy minister Saad al-Kaabi said this week. 

“This means that we will be compelled to declare force majeure for up to five years on some long-term LNG contracts,” said Al-Kaabi. (Financial Times)

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The war in the Middle East could plunge the world into its worst energy crisis in decades, International Energy Agency (IEA) Executive Director Fatih Birol warned on Monday, describing the situation as “very severe.”

Speaking at the National Press Club in Canberra, Birol said the current crisis has already surpassed the scale of the two devastating oil shocks of the 1970s — combined.

“Many of us remember the two consecutive oil crises in the 1970s… at that time, in each of the crises, the world lost about five million barrels per day — both of them together, 10 million barrels per day,” he said. “As of today, we have lost 11 million barrels per day — more than two major oil shocks put together.”

Birol warned that the global economy now faces a “major, major threat” and that no nation would be spared if the crisis deepens. “No country will be immune to the effects of this crisis if it continues to go in this direction. So there is a need for global efforts,” he said, adding that he “very much hopes” the situation is resolved as soon as possible.

The energy warning comes amid a broader conflict that has engulfed the Middle East following a significant escalation in hostilities involving Iran. The war, which has drawn in multiple regional actors, has severely disrupted oil production and supply routes critical to global energy markets.

Iran, one of the world’s major oil producers and a key player in the Persian Gulf region, has been at the centre of the conflict. Hostilities have threatened the free flow of oil through the Strait of Hormuz — the narrow waterway through which roughly 20 per cent of global oil supplies pass — raising fears of prolonged supply disruptions.

The conflict has also prompted Israeli military strikes on Iranian energy infrastructure, including a key gas field, sending energy prices sharply higher and fueling concerns among Western governments and international institutions about the long-term stability of global energy supplies. (Arab News/ Reuters)

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President Anura Kumara Dissanayake met with party leaders in Parliament on Friday (20) to brief them on the ongoing conflict in the Middle East and its implications for Sri Lanka. 

During the discussions, the President highlighted the global energy challenges that have emerged in the wake of the Middle East conflict and explained their impact on Sri Lanka’s energy sector and economy. 

He also briefed party leaders on the measures the government has already taken to address these challenges.

Opposition Leader Sajith Premadasa, Rauff Hakeem, Mano Ganesan, and several other party leaders attended the meeting. (Newswire)

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Two people have been killed in Oman after drones came down in the Sohar province, according to Oman’s state news agency, as Gulf nations remain caught in the crosshairs of the war the United States and Israel launched on Iran, sparking Tehran’s retaliation across the region.

The agency, quoting a security source, said on Friday morning that one of the drones hit the al-Awahi Industrial Area, killing two foreign nationals and injuring others.

The other one fell in an open area with no injuries recorded, the agency also said, adding that the authorities were investigating the incident.

On Wednesday, Oman’s state media reported that drones struck fuel tanks in the country’s Salalah port. Tehran denied a role in that attack.

Oman’s state news agency, quoting an energy ministry official, said that there had been no disruption to the continuity of oil supplies or petroleum derivatives in the country.

Private maritime security company Vanguard Tech reported the suspension of the port’s operations after the attack on its southern section.

Multiple attacks on Saudi Arabia

In the meantime, Saudi forces intercepted a drone on Friday targeting Riyadh’s Diplomatic Quarter, which houses foreign embassies, the Ministry of Defence said on Friday.

The “hostile drone” was downed “during an attempt to approach the Diplomatic Quarter”, the ministry posted on X.

Three more drones were intercepted elsewhere in Saudi Arabia at about the same time, the ministry said.

A ministry spokesperson said air defences had shot down eight more drones in the central and eastern regions of the country, as well as the al-Kharj governorate and west of the capital, Riyadh.

Earlier, the ministry reported 14 drones were intercepted and destroyed in waves of attempted attacks.

In Dubai, debris fell on the facade of a building in the city centre on Friday morning after an attack was intercepted by the air defences of the United Arab Emirates, according to the Dubai media office, which reported no injuries.

The region has been ignited by war since Israel and the US launched joint attacks on Iran on February 28, killing about 1,300 people and injuring more than 10,000, according to the Iranian authorities.

Tehran has retaliated with drone and missile strikes targeting Israel, Jordan, Iraq, and the Gulf countries hosting US military assets since then.

Lebanon has suffered greatly under relentless Israeli bombardment, which has killed nearly 700 people. (Al Jazeera)

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President Anura Kumara Dissanayake has warned that Sri Lanka is facing an external economic shock due to the ongoing war in the Middle East, urging the public and businesses to respond collectively to manage its impact.

Key points from his remarks:

1. The President said the Middle East conflict has disrupted global supply chains, creating economic pressure on many countries including Sri Lanka.

2. He noted that global crude oil prices have increased by about 42% since early March, rising from around USD 70 to nearly USD 100 per barrel.

3. The increase in oil prices has created uncertainty in global markets and influenced consumer behaviour locally.

4. Diesel sales in Sri Lanka rose sharply from about 4,500 kilolitres on March 1 to around 10,500 kilolitres by March 3, reflecting public concern over fuel availability.

5. The President explained that unlike the 2022 crisis, which was caused by a shortage of US dollars, the current challenge is primarily a supply disruption due to the war.

6. He said the government has established an Economic Monitoring Committee and is in discussions with friendly nations to secure supply chains and ensure continued access to essential imports.

7. The President assured that the government can maintain fuel supply for about two months under current projections, but warned that prices may fluctuate depending on developments in the conflict.

Full Speech

There has been a long-standing relationship between this COYLE forum and myself personally. At that time, you presented me with a series of questions regarding our policies and the strategies we intended to follow. It has now been more than a year since we assumed power. If you had questions then, do you still have them today? If there were doubts regarding our economic policies, I believe those doubts have now been resolved. What remains now is to face the challenges before us successfully and transform our motherland into a victorious state. I believe that the discussion you are having now is about the measures we are taking to achieve that.

We all know that our country experienced a major collapse a few years ago. After an economic collapse, nothing remains intact; everything comes to a standstill. Therefore, we all have a bitter recent experience of how destructive the collapse of an economy can be to the social fabric. Accordingly, the first responsibility entrusted to us as a government was to restore confidence in the economy. In order to move an economy forward, people must believe in its momentum. Confidence in the economy must be built among businesspeople and industrialists.

Even when we assumed power, the country had already entered into an Extended Fund Facility programme with the International Monetary Fund. That programme introduced certain targets and parameters. Even aside from those parameters, there are several indicators that help build confidence in an economy. I believe that through these indicators we have achieved highly successful outcomes that exceed both the parameters linked to the IMF programme and the targets we ourselves expected.

Among these achievements are recording the lowest budget deficit in Sri Lanka’s history in 2025, bringing the current account balance into surplus, achieving government revenue of 17.2 per cent in 2025 after several decades and making 2025 the year with the highest foreign remittances received by Sri Lanka. Therefore, the country’s economy is now stable. However, what we need is a resilient economy. We must create an economy capable of withstanding both external and internal shocks. If an economy collapses in the face of such shocks, it cannot remain stable. Accordingly, we are now building an economy that can withstand such internal shocks.

However, at present we are facing an external shock. The war situation in the Middle East is disrupting the supply of goods and services. The world is interconnected through markets. In such an interconnected global system, any shock arising in one sector affects us as well. Therefore, the key question is how we withstand these external shocks.

At the beginning of March, a barrel of crude oil was priced at approximately USD 70. It has now risen to around USD 100, representing an increase of roughly 42%. Oil prices continue to fluctuate significantly, creating a climate of uncertainty worldwide. This situation has impacted all nations, generating economic pressures and in some cases, social strain. It is important to note that citizens are not to be blamed for these challenges. The consequences of fuel and gas shortages have been experienced directly by the population. In response, citizens have been lining up at fuel stations. Sales of diesel began with 4,500 litres on the first day of March and increased to 10,500 litres by 3 March.

Petrol sales initially rose from around 4,000 kilolitres to approximately 9,000 kilolitres, but have now fallen back below 6,000 kilo litres. Therefore, it is important to emphasise that no individual can remain safe or unaffected in isolation. If everyone collectively takes responsibility and acts together to address this challenge, it is only through such shared effort that we can overcome it for the benefit of all.

These external shocks are exerting a tangible impact on us, which has necessitated an increase in fuel prices. Approximately 47% of our fuel market is controlled by external entities, which makes it essential to establish trust with them. At the same time, it is important to bring fuel availability back to normal consumption levels. The recommendation is that, through collective effort, we should work together to reduce further for the benefit of all.

The 2022 crisis arose not because global supply routes were disrupted or fuel reserves were attacked, but due to a shortage of dollars to procure fuel. Today, however, that problem no longer exists, as we now have foreign reserves of USD 7.2 billion. Consequently, any future crisis would only occur as a result of disruptions in supply routes. In anticipation of such risks, discussions are underway with friendly nations to secure alternative channels. It is the government’s responsibility to ensure an uninterrupted supply of energy. Any disruption would cause the significant economic gains we have achieved in a short period to stall. Therefore, the government’s comprehensive plan focuses on guaranteeing continuous energy supply.

Continuous energy supply can now be assured. However, it is only possible to forecast and guarantee this reliably for a maximum period of two months. If the conflict persists beyond this two-month window, predictions based on current assessments will no longer hold.

This is an era in which technology and science have given unprecedented power to warfare. As a result, it is impossible to predict the impact of such advanced military operations over the long term. Short-term forecasts are possible, but if the conflict continues beyond that period, no one can reliably predict the outcomes. Therefore, assurance can be provided that energy supply will be maintained over the next two months, however, prices may fluctuate. I am neither an owner of an oil well nor a representative of any oil company. These actions are not undertaken for personal profit. However, as a government, there is a responsibility to ensure an uninterrupted supply of energy.

All necessary measures have been put in place to manage internal pressures effectively. We have been able to address these domestic challenges, but confronting external shocks will require additional time. We are currently navigating a path of recovery and progress, which naturally entails encountering certain pressures. However, these challenges are being carefully managed and efforts are on-going to mitigate their impact. It is essential that everyone collectively faces these pressures, acting with consideration not only for oneself but for the welfare of the entire community. Consequently, some adjustment to consumption patterns is necessary. Unlike stable economies, nations facing global crises cannot rely solely on habitual consumption practices. In times of crisis, restraint and prudent economic behaviour are indispensable. I urge everyone to adopt a degree of moderation and participate in careful economic practices. By doing so collectively, we can successfully navigate this crisis and emerge stronger.

A long-term plan has also been developed, with digitalisation forming a central component. Historically, our nation has missed significant opportunities. The world continuously generates new economic prospects through advancements in science and technology. Over the past century, we have witnessed remarkable innovations across various scientific and technological fields globally. However, parallel to this progress, our nation has struggled to keep pace with technological and scientific development. As a result, we have not been able to advance alongside the rest of the world. In the current era, digitalisation, artificial intelligence and data centres represent key technological platforms that create new economic opportunities. It is therefore essential that we capitalise on these opportunities. As a government, every effort is being made to harness advancements in science and technology to rebuild and strengthen the nation’s economy in this new era.

Digitalisation must be pursued on a large scale and significant effort is being invested to achieve this. Under the current budget, approximately LKR 6.5 billion has been allocated for digital initiatives. It is anticipated that, before the end of this year, digital identity cards will be issued. This will allow for the minimisation of inefficiencies and delays within the state mechanism, enhancing overall administrative effectiveness.

Work is currently underway to transform the entire state apparatus. In this endeavour, the significant driving force of the nation’s economy is in your hands. Expand your business twofold or threefold. The role of the government is to provide all the necessary services and support to enable this growth. Every individual is encouraged to grow their business by 100% over the next two to three years, thereby becoming a key contributor to the national economy. (Newswire)

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The Cabinet of Ministers has approved a proposal to establish an Economic Monitoring Committee to evaluate and respond to potential risks arising from the ongoing conflict in the Middle East.

According to the government, Sri Lanka, as a small open economy, is particularly vulnerable to external shocks due to its reliance on energy imports, remittances from migrant workers in the Middle East, and trade and investment ties with the region. 

The government noted that the instability could create adverse effects on the national economy.

The newly appointed committee will continuously monitor the situation, assess risks across different sectors, and recommend necessary policy measures. 

It will be chaired by State Minister of Finance, Dr. Anil Jayantha Fernando, and will include heads of relevant institutions along with industry experts.

This initiative, presented by the President, aims to safeguard Sri Lanka’s economy against disruptions stemming from the volatile global environment created by the Middle East conflict. (Newswire)

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The Cabinet of Ministers has approved a proposal to extend visas for foreigners unable to leave Sri Lanka due to the cancellation of flights as a result of the Middle East conflict, since February 28, 2026.

Under the decision, affected travellers will be granted a 14‑day visa extension free of charge. If cancellations continue, their visas will be extended for a further 14‑day period without fees.

The measure was introduced by the Minister of Public Security and Parliamentary Affairs, who emphasized the need to provide legal facilities for stranded passengers until alternative travel arrangements can be made.

This move ensures that foreigners impacted by the ongoing conflict in the Middle East can remain in Sri Lanka lawfully while awaiting new flight options. (Newswire)

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Deputy Minister of Foreign Affairs Arun Hemachandra says four Sri Lankans injured in recent Middle East attacks have all been discharged from the hospital and are recovering.

Hemachandra said in a statement that he had spoken by phone with three of the injured nationals, who confirmed they were safe and recovering well. 

While the contact details for the fourth individual remain unreachable, the Deputy Minister noted that he, too, has been safely discharged.

“The safety and well-being of Sri Lankan nationals abroad continue to be a priority, and our missions in the region are closely engaged in monitoring the situation,” Hemachandra stressed. 

He added that Sri Lanka hopes for restraint, stability, and a peaceful resolution that safeguards civilian lives amid heightened tensions. (Newswire)

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Sri Lankan Foreign Minister Vijitha Herath has held a series of high‑level discussions with counterparts across the Middle East, underscoring Colombo’s commitment to peace, stability, and the welfare of Sri Lankan migrant communities.

In a call with Bahrain’s Foreign Minister Dr. Abdullatif bin Rashid Al Zayani, Minister Herath exchanged views on regional developments and emphasized the importance of de‑escalation and diplomacy in safeguarding stability. He also expressed appreciation for Bahrain’s care towards Sri Lankan expatriates.

Minister Herath also spoke with Jordan’s Deputy Prime Minister and Foreign Minister Ayman Safadi, reaffirming Sri Lanka’s commitment to peace and stability. Both sides agreed that restoring regional peace is a top priority, with Herath thanking Jordan for its support to the Sri Lankan community.

In a discussion with Lebanese Foreign Minister Youssef Raggi, the two leaders shared perspectives on current regional developments and pledged joint commitment to de‑escalation and the protection of civilians through sustained diplomatic engagement.

Meanwhile, in a call with Kuwaiti Foreign Minister Sheikh Jarrah Jaber Al‑Ahmad Al‑Sabah, Minister Herath reaffirmed Sri Lanka’s shared commitment to peace and security, urged restraint and de‑escalation through diplomacy, and conveyed gratitude for Kuwait’s continued support to Sri Lankan nationals.

The engagements highlight Sri Lanka’s diplomatic outreach at a time of heightened regional tensions, with a strong focus on protecting its citizens abroad while advocating for peace. (Newswire)

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A discussion was held this morning (04 Mar) at the Presidential Secretariat under the leadership of President Anura Kumara Dissanayake regarding the possible impact on Sri Lanka’s economy due to the current war situation in the Middle East and the urgent measures that should be taken to manage it.

The President pointed out that although future developments cannot be predicted, continuous attention must be paid to new developments in every sector, and collective action must be taken to overcome these challenges.

Lengthy discussions were held on the challenges that may arise in relation to fuel and gas, the need for stock management, as well as possible impacts on tourism, exports, investments, and food security, and the steps required to manage inflation while minimizing the impact on Sri Lanka’s economic stability and the daily lives of the people.

Although current fuel reserves are sufficient, attention was drawn to maintaining necessary stocks in view of possible risks ahead, managing them, and addressing fluctuations in global fuel prices. The President also examined the measures needed to manage these situations.

Attention was also paid to problems arising from inadequate storage facilities for maintaining gas reserves and to short‑term strategies that could be adopted to resolve them.

The possible impact on Colombo Port due to disruptions in maritime navigation caused by closures of locations such as the Suez Canal and the Hormuz Strait was also discussed. The President emphasized the need to provide facilities requested by shipping companies working with Sri Lanka over the long term to minimize such impacts.

The Secretary of the Ministry of Trade, Commerce, Food Security and Cooperative Development stated that although adequate food reserves are currently available in the country, plans have been prepared to take necessary steps considering possible risks ahead.

The President instructed relevant authorities to ensure facilities for tourists already affected, noting that most tourists arriving in Sri Lanka from Europe travel via the Middle East. Officials from the Ministry of Tourism explained that discussions are underway on alternative measures in air travel to sustain the tourism industry, while officials from the Ports and Civil Aviation Ministry clarified steps already taken.

The President also drew attention to opportunities that may arise in the investment sector, stressing the need for planned action. He instructed the Ministry of Finance to prepare an incentive package for investment promotion using new technologies such as data centres, and to examine measures under the leadership of Senior Presidential Advisor on Digital Economy, Hans Wijayasuriya. (Newswire)

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Sri Lanka Police have intensified security measures at foreign diplomatic missions and locations linked to foreign nationals in Sri Lanka following rising global tensions, the Police Media Division said.

In a statement issued on March 3, the Police said the Inspector General of Police has instructed all police stations to implement special security arrangements to prevent any incidents that could disrupt public order or national security.

Accordingly, enhanced protection has been ordered for embassies, high commissions and their official residences, as well as other affiliated premises. Police said these security measures will remain in place until further notice

The directives also cover the safety of foreign nationals currently in Sri Lanka, including their residences, business establishments, tourist sites, hotels, residential buildings and places of religious worship.

Police said a 24-hour security plan has been introduced to ensure the protection of both individuals and property.

If required, assistance from the armed forces will be sought to support the implementation of these security measures, the statement added. (Newswire)

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President’s Counsel Saliya Pieris has warned that Sri Lanka cannot be under any illusion that it is immune from the ongoing war in the Middle East, stressing that the country’s economy faces both short‑term and long‑term risks from the crisis.

He noted that global oil prices have already risen steeply and natural gas production has been restricted, developments that will inevitably affect Sri Lanka in the coming months. 

In a statement on social media, Pieris highlighted possible consequences, including foreign‑exchange fluctuations, impacts on tourism from Europe and the Middle East, interruptions to tea exports, and challenges to foreign employment and remittances.

He emphasized that it is prudent for the Government of Sri Lanka to recognize these challenges early and plan ahead to prevent devastating consequences to the economy. 

“In this process, perhaps difficult decisions may have to be taken. It is important that the Government takes the people into its confidence, keeping them informed of possible risks and of what it intends to do to mitigate these risks. Such measures will build confidence. During the Covid period in 2020-22, the Prime Minister of Singapore regularly briefed the people on the Government’s plans, inspiring confidence in that Government,” the former BASL Chairman said.  

He cautioned that Sri Lanka’s 2022–23 economic crisis was not only the result of poor economic management but also the failure to take timely and necessary action. (Newswire)

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Opposition Leader Sajith Premadasa convened a meeting today at the Office of the Leader of the Opposition in Parliament with party leaders and Members of Parliament representing the opposition to discuss the impacts of the ongoing Middle East conflict on Sri Lanka.

In a statement, Premadasa said that during the meeting, extensive discussions were held on the military crisis unfolding in the Middle East region. 

Special focus was placed on Sri Lanka’s significant imports and exports linked to Iran and the wider Middle East, with participants highlighting the potential economic consequences. 

Attention was also directed towards safeguarding the lives of nearly one million Sri Lankan workers employed in the Middle East, he said.

Premadasa further said that the opposition leaders emphasized the need for greater government focus on ensuring their safety and protecting their employment, stressing that these issues require urgent attention. (Newswire)

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The Ministry of Foreign Affairs has established an Emergency Response Unit to ensure the safety of Sri Lankans living in the Middle East, due to the tense situation prevailing in the region.

Issuing a special notice, the Foreign Ministry announced the following telephone numbers and email address for contact in any emergency;

• Emergency Response Unit, Ministry of Foreign Affairs :

+94117445641 / +94112207250 

• WhatsApp only :

+940777189552

• Email :

emergency.sl@mfa.gov.lk

• Consular Affairs Division, Ministry of Foreign Affairs :

+94742595546 

• Sri Lanka Bureau of Foreign Employment :

+94719802822 

• Hotline :

1989

This service is open to Sri Lankans employed in the Middle East region or to their relatives residing in Sri Lanka to obtain any necessary assistance. (Newswire)

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A special discussion among opposition party leaders on the prevailing military situation in the Middle East is scheduled for today (03 Mar) at the Parliament complex.

It is reported that this discussion is scheduled for this morning at the Office of the Leader of the Opposition located in Parliament under the leadership of Opposition Leader Sajith Premadasa.

According to reports, the meeting will discuss matters concerning Sri Lankans working in that region affected due to the conflicts arising in the Middle East region.

Opposition leaders are also expected to deliberate on potential implications for Sri Lanka arising from the situation and convey their observations to the government. (Newswire)

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