Hi, this is Hot Mic and I'm Nidhi Razdan.
Dramatic developments in Sri Lanka over the last 24 hours as the world watches closely to see what will happen next. Protesters have taken over the prime minister's office and the state broadcaster as the crisis has deepened. How did we get here? Well it started overnight, when the embattled president, Gotabaya Rajapaksa, fled the island nation and flew to the Maldives. It's reported that this is not likely to be his final destination. So he's heading to another country. President Rajapaksa, his wife and two bodyguards boarded a Male-bound military aircraft from Colombo International Airport.
Reports claim that his younger brother and former finance minister, Basil Rajapaksa has also left the country. Now, this development came on a day when the president was supposed to formally step down, which he had promised to do. And that has been a key demand of the protesters who stormed the presidential palace over the weekend.
The Indian High Commission in Sri Lanka, meanwhile, dismissed reports claiming that India had helped President Rajapaksa and his brother Basil flee. They said that the high commission categorically denies baseless and speculative media reports that India facilitated the recent reported travel of Gotabaya Rajapaksa and his brother out of Sri Lanka.
It is reiterated that India will continue to support the people of Sri Lanka. Well, the Sri Lankan government has declared a state of emergency since then. Prime Minister Ranil Wickremesinghe has taken over as the acting president and has imposed curfew in the western province of the country. Now his taking over as acting president is what has further angered protesters because apart from Gotabaya Rajapaksa, Mr. Wickremesinghe is also deeply unpopular. In fact, protesters had set fire to his private residence on Saturday.
Thousands of protesters have been demonstrating at his office today and have ended up occupying it. In fact, earlier Mr. Wickremesinghe had announced that he too will step down once an all party government is ready to take over. That uncertainty continues to remain, but more on that later. Ordinary Sri Lankans have been on the streets for months now, demanding accountability and change for the severe economic crisis they are facing, which has left them with a shortage of food, fuel and even medicines. Long power cuts only made things even more difficult. ‘Go Gota go' was their rallying cry. But by running away, Rajapaksa will not face any consequences at home for his mismanagement of the government and the economy.
This has, in fact, angered many of the protesters even more. Moreover, he's yet to formally resign, as he had said he would. It is a huge fall from grace for President Rajapaksa, who has been a towering political figure in Sri Lanka for more than two decades, along with his entire family. He was the defence chief when the Sri Lankan military defeated the Tamil rebels or the LTTE in 2009, which saw him accused of human rights abuses - allegations he denied.
The operations, however, made him and his brother Mahinda heroes among the majority Sinhalese community. Riding a nationalist wave, after the 2019 Easter bombings, Gotabaya became president and his government was openly majoritarian. The minorities faced the brunt of his rule. Today, none of that has mattered, as the economy crumbled, with people from all communities lining up against him and the Rajapaksa family. There is now a very real threat of a power vacuum in Sri Lanka after the president's departure and the deteriorating situation.
A stable, functioning government is an absolute necessity for the country as it deals with its huge economic and financial crisis. Politicians from other parties in Sri Lanka have been talking about forming a new unity government, but there is no sign that there are any near agreement. It's also not clear if the public would accept whatever they come up with. As per Sri Lankan law, the acting president has 30 days to hold an election for the new president from among members of Parliament. What Sri Lanka immediately needs, though, is money.
The Sri Lankan rupee has crashed to 350 against the US dollar and inflation is at over 50%. The current state of anarchy is making global investors and creditors even more wary. Much of the focus is also on the China factor and whether Sri Lanka went over the edge because of this. According to an independent think tank, China employed its debt trap diplomacy to gain a strategic edge over Sri Lanka. According to Red Lantern Analytica, the think tank, the port cities of Hambantota and Colombo have been leased to China for 100 years.
China is now the second largest lender to Sri Lanka, holding more than 10% of Sri Lanka's outstanding foreign debt in 2019. It added that Sri Lanka has fallen apart as a country because of the economic disaster caused by poor governance, lack of transparency, the Chinese debt trap as well as corruption. It goes on to say that when China took advantage of the situation to increase Sri Lanka's debt burden, India gave a helping hand by offering financial packages consisting of $500 million in a credit facility for gas imports and $1,000,000,000 credit facility for the import of critical products from India. Additionally, India has sent $2.4 billion through currency swaps, loan deferrals and other credit lines.
However, it was unable to save Sri Lanka, which was entirely enslaved by Chinese debt, and ultimately succumbed to it. In a recent piece, former Pakistani diplomat Husain Haqqani has written that China, which over the years was quick to offer high interest loans for infrastructure projects in Sri Lanka, has been quiet during this current crisis.
President Gotabaya Rajapaksa - who along with his brother, the former president and prime minister Mahinda Rajapaksa, was responsible for Sri Lanka's heavy borrowing from China - recently lamented that South Asian countries in financial trouble are not getting the same attention from Beijing as before. Sri Lanka's crisis and that of other countries around it demonstrates that China's lending policies are based less on economic viability and more on giving China strategic advantage, according to Husain Haqqani. For now, though, the immediate focus is the situation in Sri Lanka itself and whether it can pull itself out of the current chaos that it faces in order to have some kind of stable government in place.