AGP Executive Report

Governance & Courts: The Court of Appeal has ordered the Attorney General to seek clarification from a senior Customs official after judges said remarks made to Parliament’s CoPF on the Port of Colombo vehicle detention case may have misled the committee, with contempt concerns raised. Judicial Independence: The government’s plan to extend judges’ retirement ages is facing pushback, with the Judicial Service Association rejecting the proposal and warning of knock-on effects for appointments. Security & Appointments: An Opposition MP alleges the Army Commander’s tenure is being extended until January 2028 at the request of Cardinal Malcolm Ranjith, raising fears over senior military promotions. Fiscal Watch: Sri Lanka recorded a Rs. 197.3bn budget surplus in the first five months of 2026 as revenue rose sharply. Energy Transition: Cabinet approved nearly US$55.9m in ADB/EU/Japan grants and loans for ground-based solar consolidation and true net metering. Trade & Labour Compliance: President AKD gazetted a ban on importing goods made wholly or partly by forced labour, requiring customs declarations/certification. Public Finance Accountability: Verité Research says cigarette tax leakage has cost Sri Lanka over Rs. 25bn since 2025, launching a Cigarette Tax Leakage Tracker. Tourism Strategy: The tourism ministry targets higher visitor spending by 2030, aiming to lift average spend per tourist from pre-COVID levels. Media Capacity: SLBC’s Kotmale Radio Academy marks 10 years, having trained nearly 1,000 students in radio education.

Tamil Minority Politics: Six Tamil-speaking parties (including ACMC, CWC, DTNA, ITAK, SLMC and TPA) have launched a common platform pushing for a new constitution with greater autonomy, early provincial council elections, and solutions to long-running land disputes. Prison & Governance Debate: Commentators say Sri Lanka’s prison overcrowding crisis—highlighted by recent riots and deaths—demands real capacity reforms, warning against ad hoc political fixes. Legal Accountability: Sri Lanka’s Bar Association will host a national sustainable development law symposium on 21 July, spotlighting how law can drive climate resilience and responsible growth. Environment & Health: A USD 38m GEF-UNDP project has been launched to strengthen Sri Lanka’s hazardous chemicals, mercury and medical waste management, including new lab equipment. Public Sector Digital Services: NITF will move Agrahara insurance updates and benefit disbursements online via a strict digital registry deadline of 31 July. International Aid: India has signed an MoU to grant LKR 600m for state-of-the-art equipment for the relocated Deniyaya Base Hospital under post-Cyclone Ditwah support. Energy/Trade Policy Context: Separate coverage highlights fuel pricing transparency moves abroad, underscoring how benchmark data and rules-based funds are becoming a political issue.

IMF & Opposition Politics: Sajith Premadasa says the JVP-led government is becoming “more right wing” than Ranil Wickremesinghe, arguing it promised IMF changes in its manifesto but has not delivered. Public Finance: Sri Lanka’s budget position improved sharply in Jan–May 2026, with an overall surplus of Rs. 197.3bn as revenue and grants rose 30.6% and tax income grew 23.9%. Foreign Reserves Watch: Foreign reserves fell 6.2% to US$6.45bn by end-June, with renewed external pressure despite the post-crisis recovery narrative. Women & Local Elections: Women Parliamentarians’ Caucus pushes for a legal 33% minimum women’s representation in Provincial Council and Local Government elections. Environment & Coastal Cleanup: MEPA launched the “Ocean Watch” app to digitally coordinate coastal waste management and harbour clean-ups. Public Health: Environment Ministry unveiled a USD 38.2m GEF/UNDP-backed project to strengthen mercury and healthcare waste disposal systems; Women and Child Affairs Minister urged protective clothing for preschoolers amid dengue surge. Security/Scams: Police warned of fake “traffic fine” SMS phishing that mimics GovPay and targets banking details. Healthcare Access: A new kidney stone treatment centre opened in Mirigama to ease a backlog of over 5,000 patients. Ports & Aviation: Belarus ambassador met Sri Lanka’s Ports and Civil Aviation minister on boosting air links, including moving scheduled flights from Mattala to Colombo. Business/Investment: Government received 19 EOI proposals to develop commercial operations at Mattala airport.

Negombo Prison Crisis: UN rights officials and local legal voices are pressing for urgent, transparent probes into deadly prison violence and alleged torture after riots and overcrowding concerns. Parliament & Governance: ITAK MP Shanakiyan Rasamanickam questioned the Colombo Port City’s results—foreign investment, Treasury revenue, and commission spending—demanding answers on whether the project delivered. Tax & Business Regulation: The government raised company and society registration/administration fees via a new Gazette, while commentary warns tax administration reforms are getting tougher with criminal sanctions and expanded powers. IMF & Revenue Focus: Discussion continues on the next IMF agenda item—fixing tax administration—amid claims revenue performance is exceeding targets. Finance Sector Moves: MBSL appointed Russel Fonseka as CEO; BOC launched a Tap & Pay mobile wallet; Arpico Insurance and Siyapatha Finance also announced board/branch expansions. Trade & Digital Exports: Dialog Enterprise renewed its partnership with the National Chamber of Exporters to push digital tools for exporters, especially SMEs. Agriculture Policy: Sri Lanka removed restrictions on surplus rice use, allowing value-added products like beer, wine, biscuits and animal feed to protect farmers from price collapses. Political Coordination: Six Tamil-speaking parties plan to unveil a common political platform.

Coal Probe: President Anura Kumara Dissanayake’s Special Presidential Commission on coal procurement will keep recording evidence for a third straight day tomorrow, summoning officials from the Lakvijaya coal plant and others as it investigates alleged fraud and irregularities. Dengue Prevention: The Education Ministry says students may wear clothing that covers arms and legs to reduce dengue risk, while a special mosquito control programme begins across 60 high-risk zones. Consumer Protection: The Consumer Affairs Authority raided four train canteens over overpriced goods, including water marked Rs.120 sold for Rs.150, and says legal action will follow. Judicial Appointments: The Bar Association of Sri Lanka urges the President to fill eight Supreme Court and Court of Appeal vacancies without delay, warning the prolonged gap is damaging justice and public confidence. Forced Labour Imports: Sri Lanka has introduced new rules requiring importers to certify goods are not made using forced labour after a US trade penalty. AML/Crypto Overhaul: Parliament is set to consider amendments to bring virtual asset service providers under Sri Lanka’s anti-money laundering reporting duties ahead of FATF review. Port City Next Phase: Port City Colombo will seek proposals for an international university, hospital and school as it shifts toward building institutional foundations for investors. UNFPA-Parliament Pact: UNFPA and Parliament signed an MoU to strengthen evidence-based policymaking using population data. SME Push: CA Sri Lanka and the CSE launched SME creditworthiness and support initiatives to expand SME access to finance.

Judiciary & Constitutional Reform: Sri Lanka’s District Court judges and magistrates have unanimously rejected a proposed constitutional amendment to extend the retirement age of Supreme Court and Court of Appeal judges, with the SLPP also denouncing the move as politically motivated. Prison Crisis & Accountability: After the Negombo prison riots that killed 28, including prison officials, UN rights experts and local advocates are pressing for a prompt, transparent probe into alleged torture and ill-treatment, while opposition parties have signed a no-confidence motion against the Justice Minister over the government’s handling of the violence. Water Infrastructure: President Dissanayake inaugurated Sri Lanka’s Thambuttegama water supply project, including a treatment plant and 204 km of pipelines, aimed at improving safe drinking water for over 25,000 households. Legal/Extradition Push: The government is reportedly seeking US extradition of former Finance Minister Basil Rajapaksa to face criminal proceedings in Colombo, testing the extradition relationship. Regional Energy Cooperation: The EU launched a €5m South Asia energy connectivity project in Kathmandu, including Sri Lanka, to expand cross-border power trade.

Prison & Justice: Sri Lanka’s opposition signed a no-confidence motion against Justice Minister Harshana Nanayakkara over the Negombo prison riots that killed 28, as HRCSL launches investigations and the government cites overcrowding and drug-linked clashes. Legal Process: The Attorney General told the Supreme Court the Cabinet is reviewing the legality of the previous government’s e-visa outsourcing deals, with a subcommittee set to report back. Anti-Money Laundering: Parliament approved major amendments to money laundering, terrorist financing and financial transparency laws, including faster asset-freezing powers tied to suspected primary suspects. Migrant Workers: A more flexible “Rataviru” pension scheme for overseas Sri Lankans is set to be introduced, funded via Kuwait’s Rs. 2.1 billion support. Water & Infrastructure: President Dissanayake inaugurated the Thambuttegama water supply project for 25,000 households, while another water project for 67,000 families is also reported to be underway. Economy & Outlook: The ADB kept 2026 growth at 4.0% but cut 2027 to 4.0%, warning energy-price and inflation risks could slow recovery. Diplomacy: Sri Lanka moves to seek US extradition of Basil Rajapaksa for prosecution.

Healthcare Budget: President Anura Kumara Dissanayake says the 2027 Budget will strengthen public healthcare to cut reliance on costly private treatment, with a push for primary care via “Arogya Suwa Seva Centres,” tech upgrades in state hospitals, and restarting suspended hospital projects. Prison Reform & Rights: The UN Human Rights Office calls the Negombo jail violence “deeply alarming,” urging prompt, independent, transparent investigations amid overcrowding and prolonged pre-trial detention concerns. Pardon Process Overhaul: A committee has handed its report to reform Sri Lanka’s presidential pardon system, recommending a more systematic, fair and transparent framework. Water & CKDu: President commissions major water projects, including the Rs. 32 billion Thambuttegama scheme and the Anuradhapura North Water Supply phase, aimed at safe drinking water for tens of thousands and reducing CKDu risk. Governance & Infrastructure: A deputy minister says future infrastructure should be guided by research and innovation to protect ecosystems, while CAASL commissions a solar system to cover over 70% of its power needs. Tourism & Energy Links: Tourism earnings top $1.5bn with arrivals passing 1.2m; meanwhile the EU launches a €5m South Asia energy connectivity project spanning Bangladesh, Bhutan, India, Nepal and Sri Lanka. Economy & Finance: Union Bank CEO warns SMEs undermine finance access by understating profits and using multiple accounts, forcing banks to reconstruct financials.

Prison Overcrowding Crisis: Human rights advocates say Sri Lanka’s plan to reopen a colonial jail and recruit staff after the Negombo prison riot that killed 28 must be backed by international best practice, noting chronic “salmon packing” and extreme violence before deaths. Judicial Appointments: The Bar Association of Sri Lanka urges President Anura Kumara Dissanayake to fill Supreme Court and Court of Appeal vacancies without delay, warning delays could erode public confidence. Easter Bombings Legal Fight: The Court of Appeal will hear intervention pleas in retired Major General Suresh Sallay’s writ case on July 17, as allegations around the 2019 Easter attacks continue to reshape the investigation. Evidence-Based Governance: UNFPA and Parliament sign an MoU to strengthen use of population data in lawmaking, aiming to better plan for ageing and changing family structures. Digital Trust & Scams: Sri Lanka’s Digital Economy Deputy Minister says scam operations are relocating to Sri Lanka as enforcement tightens elsewhere, pushing for cross-border responses. Energy & Climate: CAASL commissions a solar PV system to cover over 70% of its power needs, while the EU launches a South Asia energy connectivity project to expand cross-border electricity trade. Local Administration: President Dissanayake says a separate contingency fund will be allocated to every district in the forthcoming Budget to speed urgent repairs without waiting for central approval.

Tea Sector & Wages: Labour Minister Ariful Haque Choudhury told Parliament the government will review and revise tea workers’ minimum wage in August, with the Wage Board meeting next month and changes tied to inflation, costs and workers’ living standards. Dengue Response & Public Health: Sri Lanka’s dengue fight is intensifying as cases climb past 56,000 with 35 deaths, while the Navy joins health teams in Colombo’s “Towards a Dengue-Free Colombo” drive to find breeding sites and run awareness sessions. Foreign Employment: SLBFE says 2,498 candidates qualified for South Korea jobs after the Korean Language Proficiency Test, following the EPS process. Trade & Ports: A reported cancellation of President Dissanayake’s France visit adds uncertainty to planned bilateral talks, including with CMA CGM, while shippers face a July 22 CMA CGM surcharge deadline. Justice & Rights: The Supreme Court upheld an order requiring former minister Wimal Weerawansa to pay Rs. 1 million to Tilvin Silva over intellectual property violations. Maritime Enforcement: The Navy seized 60,000 illegal sea cucumbers in Mannar and also intercepted smuggled pharmaceuticals and cosmetics in Puttalam.

Prison System Under Fire: Sri Lanka’s Negombo Prison unrest is driving fresh political pressure as the Prisons Commissioner General said authorities had no prior intelligence and defended officers’ response, while the Bar Association of Sri Lanka (BASL) demanded an independent, transparent probe and wider prison reforms after at least 27 deaths and 100+ injuries. Judicial & Security Accountability: BASL urged publication of findings and accountability, as government officials also pointed to drug influence and overcrowding as key factors behind the violence. Health & Public Services: President Anura Kumara Dissanayake said the government has restarted 26 major healthcare infrastructure projects and is preparing priorities for the 2027 Budget, while dengue cases climbed to 65,034 with 1,300 new cases reported in 24 hours. Governance & Digital Delivery: The Registrar General’s Department completed a leadership programme under OneRegistry to modernise civil registration, and Connect to Care registered as an NGO to strengthen governance and scale development impact. International Defence Ties: Kazakhstan’s ambassador met Sri Lanka’s Defence Ministry officials to discuss expanding defence cooperation, training, and HADR capacity building. Trade & Labour Standards: Sri Lanka is preparing fresh U.S. engagement to avoid new tariffs tied to child or forced labour concerns in export supply chains.

Negombo Prison Crisis: Opposition Leader Sajith Premadasa blamed the Government for the Negombo Prison deaths, arguing the State can’t credibly claim national security while failing to protect people in its custody; he cited constitutional protections against torture and cruel treatment as Parliament debates the tragedy. Prison Reform & Accountability: Justice Minister Harshana Nanayakkara told Parliament early investigations pointed to a clash sparked by inmates allegedly informing on drug smuggling, with CCTV reportedly disabled and weapons access still unclear; authorities moved hundreds of prisoners and a special probe is underway as families mourn. Judiciary Independence: The Bar Association of Sri Lanka (BASL) defended its stance against an ad hoc constitutional move to extend judges’ retirement age, warning it could weaken public confidence in judicial independence and the rule of law. Anti-Money Laundering Push: Cabinet-backed AML amendments would broaden money laundering offences, make wilful tax evasion a predicate offence, and strengthen asset-freezing powers, while the CoPF questioned the FIU’s long-term independence from the Central Bank. Labour Market Reform Debate: Port City Colombo is considering a regulatory “sandbox” to trial labour reforms, arguing rigid hiring and firing rules are pushing talent and entrepreneurship overseas. Education Policy: PM Harini Amarasuriya said reforms from 2027 will shift Sri Lanka toward skills-based education and vocational training for the modern labour market. Economy & Investment: UNCTAD reported Sri Lanka attracted $1.044bn FDI in 2025, up from $759m in 2024, signalling renewed investor confidence.

Prison System Under Fire: Sri Lanka has ordered a probe into the Negombo prison riot that killed 26 inmates and 7 guards, with the justice ministry saying a new Mahamodara prison will be set up in a disused hospital building as jails run at about four times capacity. Accountability Push in Parliament: SLPP organizer Namal Rajapaksa said “system change” has failed and argued the responsible minister should have resigned, while the UN welcomed the independent investigation and called for lasting prison reforms. Disability Inclusion: ChildFund warned that despite labour shortages, nearly 70% of persons with disabilities remain unemployed, calling inclusion an economic necessity, not charity. Digital Tax Clarity: EY cautioned that Sri Lanka’s proposed digital VAT rules may confuse online platforms on whether VAT applies to total payments or platform commissions, risking higher compliance costs. Dengue Response: Dengue control efforts continue as reporting eases in some districts, but deaths remain high and authorities face renewed scrutiny over mosquito breeding sites. Education Reform: PM Harini Amarasuriya said reforms will shift schools from exam-only learning to practical, skills-based vocational pathways starting in 2027.

Negombo Prison Riot Fallout: Sri Lanka’s deadliest prison violence in years continues to reverberate as relatives wait outside Negombo Prison for updates, while officials say the clashes were driven by drug trafficking links and inmates’ access to narcotics and weapons; the Justice Minister has ordered probes and Parliament is set to debate the incident, with the UN calling for prison reforms and renewed investment. Government Oversight & Health Response: The Health Minister visited the National Hospital to review treatment for injured prison officers and inmates, with dozens still admitted, as authorities investigate how firearms and drugs entered the facility and whether CCTV was disabled. IMF Revenue Reform Talks: At the President’s Office, the IMF reviewed Sri Lanka’s tax and customs reforms under the Medium-Term Revenue Strategy, focusing on digital transformation, data integration, and broadening the tax base. Local Governance/Infrastructure Pressure: Residents and businesses near the Kerawalapitiya industrial zone complain a key access road has been left in disrepair for years, worsening flooding and potholes during rains. Business & Appointments: Ceylon Biscuits Limited named Sheamalee Wickramasingha as chairman while keeping her as group managing director, and Sampath Bank launched Google Pay for Visa/Mastercard cardholders. Sports Diplomacy (India-Sri Lanka Link): Sri Lanka’s participation is highlighted in India’s Durand Cup build-up, with trophies unveiled in New Delhi.

Negombo Prison Riot Probe: Sri Lanka launched a criminal investigation into the Negombo prison clash after the death toll rose to 27, including 7 prison officers and 19 inmates, with 77 more treated in hospital; Justice Minister Harshana Nanayakkara told parliament the probes will examine security lapses and overcrowding, while police and a retired-judge commission are also involved. Anti-Corruption Case: Former State Minister Shasheendra Rajapaksa and two others were served indictments in the Colombo High Court over alleged influence in a Rs. 8.85 million compensation case tied to Mahaweli Authority land during the Aragalaya period; the court granted surety bails of Rs. 10 million each. Judicial Independence Pushback: SLPP urged Opposition Leader Sajith Premadasa to unite democratic parties against a reported plan to extend Supreme Court judges’ retirement age, warning it threatens rule of law and independence. Dengue Warning: The GMOA warned actual dengue infections may be far higher than official counts, citing unreported cases and a sharp rise in hospital admissions. Transport & Fisheries Policy: Cabinet approved a pilot bus sector clustering programme and a plan to expand the Vessel Monitoring System to about 1,500 fishing vessels to curb illegal fishing and related crimes.

Prison Crisis: Negombo prison clashes between rival inmate groups have left at least 23 dead (later toll reported up to 26), including guards, with more than 100 injured as police and officials work to separate drug-gang factions and investigate what sparked the violence. Public Health: Sri Lanka’s dengue situation is worsening, with 61,060 cases recorded in 2026 and 2,604 new infections in 24 hours; Western Province remains the worst-hit and hospitals are nearing capacity. Governance & Infrastructure: Narahenpita railway station has reopened after a Rs. 40 million renovation under the “Dream Destination” upgrade drive, including a new roof, platform works, sanitation upgrades and improved access. Environment & Risk Planning: The government is preparing for El Niño impacts, with a national committee coordinating food security, water and energy measures as rainfall patterns are expected to shift. Accountability & Finance: Shareholders are seeking Court leave to sue the NDB board over a reported Rs. 13.2 billion fraud, arguing oversight failures and auditor independence issues. Bilateral Ties: Sri Lanka and Pakistan agreed steps to boost trade, investment and entrepreneurship, including technology exchange and easing barriers for tea and new fruit exports.