IMF medicine too bitter to swallow: NPP faces tough choices

The Japanese Ambassador in Sri Lanka, Mizukoshi Hideaki, emphasised the importance and the responsibility on the part of Sri Lanka to implement the IMF formula.

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Hideaki, in an exclusive interview with the writer last August, in the run-up to the parliamentary election, declared that whoever wins the September 21 contest, the winner should adhere to, what he called, IMF remedies (Post-Aragalaya economic recovery depends on implementation of IMF formula - Japanese ambassador, The Island, August 21, 2024).

The country is in such a desperate situation, though there were no queues as during Gotabaya Rajapaksa's presidency, the government needs to complete the four-year IMF programme. Increasing electricity tariff is not only inevitable but a necessity, though politically damaging, especially at a time the NPP had suffered a significant drop in votes within seven months.

Electricity tariff hike ahead of the forthcoming Provincial Council polls may further undermine the NPP's vote base and provide a boost for the Opposition. But Dissanayake is not in a position to delay the process as the IMF intends to wrap up the work on the next tranche of funding.