The Rajapaksas Will Ruin Sri Lanka’s Economy
Virulent ethnic nationalism and hateful rhetoric toward minorities might win votes, but it will lead the country to economic ruin.
On Nov. 18, Gotabaya Rajapaksa took his oath as Sri Lanka’s seventh executive president, at the sacred Buddhist temple Ruwanwelisaya in Anuradhapura. Three days later, his brother, former President Mahinda Rajapaksa, was sworn in as prime minister.
It is no coincidence that Gotabaya’s inauguration ceremony occurred at an ancient temple built by Sinhalese King Dutugemenu—who is best known for defeating an invading Tamil king from the Chola kingdom. Though the president wrote on Twitter that he was “now the President of all Sri Lankans, whether they voted for [him] or not and irrespective of their ethnicity or religious beliefs,” the swearing-in ceremony indicates that the president will interpret his win as a mandate for reinforcing Sinhalese Buddhist hegemony. This interpretation advances the view that Sri Lankan minorities are invaders or guests permitted citizenry only by the grace of Sri Lanka’s rightful Sinhalese Buddhist guardians.
Now, ultranationalist Sinhalese Buddhist groups that have incited anti-Muslim riots, attacked non-Buddhist places of worship, and conducted anti-halal boycott campaigns have even stated their intention to disband—openly noting that Gotabaya’s presidency renders them redundant.
Political observers fear that members of these radical groups will be absorbed into mainstream politics. Empowered by an election victory that required little minority support, the Rajapaksa regime is likely to govern based on an anti-pluralistic “Sinhala first” or “Sinhala only” orientation, an approach that academics have long held responsible for civil conflict.
Regulations such as the 1956 Sinhala Only Act, which denied official status to the Tamil language, and policies that limited Tamils’ admissions to universities in the 1970s resulted in the emergence of several Tamil armed groups. Among them was the Liberation Tigers of Tamil Eelam (LTTE), which fought a civil war against the government from 1983 to 2009 in hopes of forming an independent Tamil state.
Like a well-oiled family business, the Rajapaksa brothers’ government benefits from deep trust, close personal connections, and stability—a dynamic alien to coalition politics. Radical Sinhalese Buddhist groups loyal to the Rajapaksas’ political party, Sri Lanka Podujana Peramuna (SLPP), such as the Bodu Bala Sena and the Nawa Sinhala Ravaya, have been stoking ethnic divisions in the country since at least 2013.
When serious intelligence oversights enabled the Easter Attacks in April, Gotabaya Rajapaksa was able to seize on ethnic divisions and highlight his own credentials as the efficient defense secretary who helped end Sri Lanka’s 26-year civil war. At the war’s culmination, LTTE combatants kept Tamil civilians hostage as human shields. According to a United Nations investigation, Sri Lankan government forces continued to fire, killing up to 40,000 civilians within a few months.
Hospitals and no-fire zones were attacked, women and girls were raped en masse, and surrendered militants were shot at close range. Despite Gotabaya’s claims that the war was a “humanitarian effort” which employed a policy of “zero civilian casualties,” the extremely high election turnout among Tamils in the country’s north and east is evidence to the contrary. Tamils who have not already fled the country do not wish to see the former defense secretary occupy Sri Lanka’s highest office.
While there is a long history of anti-Muslim violence in Sri Lanka, too often overshadowed by the civil war, Islamophobia has risen following the Easter attacks. In May, the leader of one of the country’s largest Buddhist chapters called for stoning Muslims to death and spread rumors that Muslim-owned restaurants used “sterilization medicine” in their food to reduce Sinhalese Buddhist fertility rates. During elections, campaigners for the SLPP claimed that the opposing party, the United National Party (UNP), was planning to put sterilization medicine in sanitary napkins—following a UNP pledge to provide free sanitary napkins to women. The head of Gotabaya’s legal team was even videotaped telling Muslims that if they did not vote for the former defense secretary, Muslims would get “a massive thrashing.”
While Gotabaya’s campaign capitalized on fear of Sri Lanka’s Muslim minority, it also exploited suspicions of Tamil Hindu minorities deeply embedded by the civil war. Allegations of “secret deals” between the main Tamil party and the incumbent UNP government were actively propagated by the Rajapaksas and repeatedly broadcast on TV channels supporting Gotabaya’s candidacy. While ethnic polarization may have helped increase Gotabaya’s vote share among the majority Sinhalese community, silencing those critical of the Rajapaksas’ ethnocratic nationalism or shunning human rights obligations will only harm the country in the long run.
Although Mahinda Rajapaksa’s human rights record is abysmal, his brother Gotabaya is known within the family as the “Terminator.” His counterterrorism strategy during his tenure as defense secretary was characterized by brute force. When a senior military officer and elected official claimed there was eyewitness evidence of the the defense secretary ordering army officers to shoot and kill surrendering LTTE leaders at the end of the war, Gotabaya Rajapaksa openly threatened to execute the general during a BBC interview—citing treason and betrayal of the country.
Under Rajapaksa rule, media freedom was severely restricted as journalists faced routine harassment and threats to their lives. In 2009 the editor in chief of The Sunday Leader, Lasantha Wickramatunga, was brutally killed after exposing corruption by Mahinda Rajapaksa. Gotabaya is likely to employ a similar approach toward dissent. Several journalists have already left the country, and some have stopped reporting altogether. A director of the Criminal Investigations Department whose purview included several high-profile cases has been transferred out of his role, and the department’s inspector of police has fled the country.
Soon after his election, congratulatory diplomatic messages from U.S. Secretary of State Mike Pompeo, U.S. Ambassador to Sri Lanka Alaina Teplitz, and the Delegation of the EU to Sri Lanka called on Gotabaya Rajapaksa to work on reconciliation, democratic reform, and human rights. Tellingly, responses from the president’s office have instead emphasized his commitment to economic development, trade, and regional security—tacitly indicating that even the facade of human rights adherence will now be dropped. A media release by Mahinda Rajapaksa noted that the country’s 19th Amendment—a law that provided checks and balances on the powerful executive presidency—will be subject to study and reform. Other legal reforms, Mahinda noted, would soon follow.
Gotabaya’s election victory is also a precursor to shifts in Sri Lankan foreign policy. As long as the EU and Western democracies require commitments to human rights, pluralism, and democracy, the Rajapaksas are likely to cultivate other foreign allies. Gotabaya’s election campaign, for example, attacked a $480 million Millennium Challenge Corporation grant to improve public transportation and land administration on grounds that U.S. development assistance interfered with Sri Lankan sovereignty.
Although such allegations were denied by the Millennium Challenge Corporation’s country director in Sri Lanka, disengagement with Western democracies may become the norm as the Rajapaksas pivot to allies in Asia and elsewhere that are less concerned with Sri Lanka’s domestic politics. During Mahinda Rajapaksa’s presidency from 2005 to 2015, Sri Lanka became increasingly isolated from democratic nations. In 2013, for example, Canada, Mauritius, and India boycotted the Commonwealth Heads of Government Meeting held in Sri Lanka—citing the country’s human rights record.
Amid the rise of authoritarianism in the era of U.S. President Donald Trump, Indian Prime Minister Narendra Modi, and Chinese President Xi Jinping, the Rajapaksas can pursue their brand of ethnocratic nationalism with less human rights scrutiny than in the past. They will benefit from relationships strengthened while in opposition—such as those with Russia—while also pivoting to China under the framework of the Belt and Road Initiative.
However, complete Western disengagement is impossible: After all, the United States, the United Kingdom, and Europe are Sri Lanka’s top export destinations, and cutting them off would exacerbate macroeconomic vulnerability. In 2010, the EU suspended Sri Lanka’s preferential trading status on the basis of the Rajapaksa government’s human rights abuses. Though the EU reinstated the trade concession in 2017 after Sri Lanka demonstrated human rights improvements, losing such gains would heavily impact Sri Lankan exports—2.8 billion euros of which were to the EU in 2018.
The Center for International Development at Harvard University claims that Sri Lanka’s main growth constraint is weak exports driven by factors like poor land-use governance and transportation infrastructure. The Millennium Challenge Corporation is important, then, because it targets precisely such constraints—in a context in which grants and concessionary loans are rare for newly middle-income countries such as Sri Lanka. It is yet to be seen whether the Rajapaksas will allow a politically motivated tilt from the West to impact Sri Lanka’s more urgent development needs. A litmus test will be how quickly the new government accepts the Millennium Challenge Corporation.
Sri Lankan Tamils may also hope that its proximate and militarily powerful neighbor, India, will help hold Sri Lanka accountable when it comes to reconciliation and human rights, particularly given India’s historical role in conflict resolution—including a 1987 bilateral agreement between India and Sri Lanka that aimed to end civil war by devolving powers to the provinces. Indeed, the Indian Ministry of External Affairs recently said it expected the newly elected Sri Lankan president to boost national reconciliation policy with the Tamil community.
However, such pressure is unlikely to be a reflection of genuine Indian interest in Tamil issues—given Modi’s own disregard for minority rights at home. During Mahinda Rajapaksa’s tenure as president, India was governed by a coalition of the Indian National Congress and regional parties. Then, stakeholders in the Indian state of Tamil Nadu interested in promoting human rights in Sri Lanka had significant leverage in Indian politics.
Now, the Indian government is less concerned by anxieties in Tamil Nadu. While Modi has been trying to make inroads into Tamil Nadu, his 2019 landslide election win was secured despite Tamil Nadu overwhelmingly voting against Modi’s Bharatiya Janata Party. Tamil Nadu’s historical distrust of nationalist leaders is more fundamental than foreign policy. In that context, it is unlikely that Modi will risk damaging relations with Sri Lanka to secure inroads in Tamil Nadu—as the cost would be Sri Lanka’s inevitable pivot towards China.
Modi’s India and the Rajapaksas’ Sri Lanka actually have much in common now. Modi’s popularity is propped up by fears of Islamic terror and his perceived competency in managing national security. He even invoked the Sri Lankan Easter attacks as an example of what might happen under a weaker government as a way to court votes for his Hindu nationalist party. Modi’s rhetoric and actions, whether in Pakistan or Kashmir, rely on strongman tactics similar to those employed by the Rajapaksas.
In this new regional order, Indian pressure on the Rajapaksas to sustain human rights and reconciliation is perhaps just leverage in case the Rajapaksas fail to meet India’s primary security interest: limiting China’s presence in Sri Lanka. The Rajapaksa government has already identified this concern: Soon after his election, Gotabaya Rajapaksa stated that Sri Lanka “cannot engage in any activity that will threaten the security of India.”
As always, Sri Lanka must balance Chinese and Indian interests. As the Rajapaksas learned when Mahinda Rajapaksa lost his bid for a third term as president in 2015, careless dependence on China has significant domestic costs—particularly when infrastructure projects displace residents, fail to generate jobs, or do not meet environmental standards.
In the context of a stagnating economy, low-return projects such as the Chinese-funded Hambantota port, Mattala Rajapaksa International Airport, and the Lotus Tower in Colombo can provoke domestic outrage if debt repayment for these projects becomes debilitating. Given the harsh criticism of the Belt and Road Initiative in recent years—that it amounts to a debt trap for vulnerable countries, fuels corruption, and disrupts fragile democracies—the Rajapaksas may be initially cautious about being perceived as too close to China.
Sri Lanka’s embrace of ethnocratic populism is part of a broader regional trend. However, as economist Arvind Subramaniam has argued, a lack of political inclusion will only exacerbate the country’s fragile economic situation. Gotabaya’s proposed economic policies—generous tax cuts and high levels of welfare spending—will be expensive and may contribute to budget deficits. If policy stability and openness to free trade decrease, foreign direct investment will dry up.
If the Rajapaksas prioritize major infrastructure projects—the type China likes to fund—to promote growth, Fitch Ratings warns that the erosion of fiscal flexibility could “undermine policy credibility, investor confidence, and potentially complicate relations with the IMF.” Sri Lanka’s debt-to-exports ratio is already extremely high, and the country cannot afford foreign direct investment to stagnate or external financing to become more expensive than it already is.
In the end, there will be limited numbers of ports and parcels of land that Sri Lanka can lease away to its neighbors. And there will be only so much that foreign nations—allies or foes—will lend to a country that cannot pay it back. Gotabaya’s presidency threatens to shrink the economic pie for all Sri Lankans, but it will also result in enduring political division if it succeeds in triggering vicious cycles of Sinhalese ethnic outbidding as nationalists seek to be even more exclusionary than their opponents.
If the new opposition chooses to pursue this route—instead of focusing on the corruption, communication failures, and leadership struggles that derailed their own performance—the damage will last generations.