When Gotabaya Rajapaksa was about to declare Sri Lanka a bankrupt country, a proposal was received from China through the then Prime Minister Mahinda. The proposal was to obtain a $4 billion loan from China without declaring bankruptcy and without going to the IMF.
The proposal was made by the then Central Bank Governor Cabraal. He was someone who had gained the trust of China. He was the one who negotiated this deal with China. He was someone who was never in favour of going to the IMF as a matter of policy. The reason for this was that the government would be unfavored due to the IMF conditions.
He organized a Zoom discussion between Mahinda and the Chinese Prime Minister through the Chinese Ambassador to Sri Lanka and obtained Mahinda’s agreement to the $4 billion proposal. Although Mahinda tried to get Gotabaya to agree to this proposal, Gota’s advisors did not agree. Their advice was that he should declare bankruptcy and go to the IMF. Gota rejected the Chinese proposal and decided to go to the IMF.
Now, there has been a discussion within the JVP about this proposal again. It is not known if JVP MPs, including JVP Secretary Tilvin Silva, who recently went to China, discussed this. If China is bringing this proposal again, that is to target India. China is presenting a Chinese research ship as a condition to facilitate China’s assistance to Sri Lanka, targeting India. China wants to provoke India more than to conduct research in Sri Lanka’s territorial waters.
Recently, the Russian ambassador to Sri Lanka said at a seminar at the Bandaranaike International Centre for International Relations that although Russia and China are willing to assist Sri Lanka, the NPP government has not responded favorably.
The Chinese conflict against India and the West has now intruded on the government. Tilvin and Bimal are pro-Chinese, and Anura, Harini, and Vijitha Herath are pro-Western and pro-Indian. They think that Ranil’s IMF program should be carried forward. But Tilvin and Bimal think that it will greatly harm the JVP’s popular base, and therefore the JVP should go with China, which ideologically is close to them.
There are signs that Anura’s government is gradually transforming into Mahinda’s government. Regarding minorities, regarding the appointment of court judges, and regarding the seizure of power in municipal councils, they are showing the characteristics of Mahinda’s government. It could be the NPP government will also decide to go with China as Mahinda did with China. It is not clear they try to scare India and the Western countries by pointing at the Chinese flag and entering into a favorable deal with the IMF.
