India's great energy heist: who will resist the plunder?

As the presidential election campaign intensifies in Sri Lanka, serious concerns are being raised about the country's energy sector and its increasing ties with India. In a detailed statement, Bandu Ranga Kariyavasam, Director of the Human & Environmental Resources Development Foundation (HERD), warned of the possible “Indian energy theft” and the long-term consequences of the agreements reached between the Sri Lankan government and India.

HERD's statement comes at a time when President Ranil Wickremesinghe is actively campaigning for his re-election. On September 16, 2024, Wickremesinghe addressed a gathering in Kantale town where he laid out plans to develop the Trincomalee Port in partnership with India. He also revealed an agreement to allocate 1,000 acres of land in Kappalthura to India for office purposes, further cementing India's influence in the region. HERD's statement criticizes these agreements and suggests that they could lead to a significant erosion of Sri Lanka's sovereignty over its own resources.

HERD expressed concern that such agreements, if concluded under the current government, would be difficult for a future government to reverse. “If an agreement has been concluded with India as President, the future government cannot immediately rule it out,” the statement said. This concern stems from previous instances where President Wickremesinghe's decisions on national resources and land have had far-reaching consequences. However, according to HERD, his government has failed to implement these plans properly, leaving the country vulnerable to external exploitation.

The organisation also examined the energy policies of the major political parties, including the National People's Force and the Samagi Jana Balawegaya. It pointed out that neither party has taken a clear stance to combat India's growing dominance in Sri Lanka's energy sector. While the National People's Power has proposed producing 2,000 megawatts of clean energy, HERD argues that they have overlooked the enormous potential of wind energy in Sri Lanka. World Bank studies suggest that Sri Lanka could produce up to 56,000 megawatts of electricity through wind power. Despite this potential, the focus has been on projects such as those of India's Adani Group in the Northern Province, which could lead to higher electricity costs and less energy independence for Sri Lanka.

HERD's statement also draws attention to the critical issue of rising poverty and hunger in Sri Lanka and questions how these issues can really be addressed in the upcoming presidential elections. It criticizes the apparent complicity of power utility unions representing all political parties in India's ongoing power takeover. According to HERD, India's strategy to suppress these unions is increasingly successful. One of the recent moves mentioned was the approval of a pay hike for the power utility amid the heated election atmosphere. This pay hike, to be paid on September 18 and 19, 2024, including back pay for August, was seen as a calculated move to quell opposition within the body. Additional financial concessions were also made to electricity workers in recent days, apparently to quell protests against the significant hike in electricity bills.

HERD accuses the government of using the significant profits from this tariff hike to “bribe” board officials and thereby strengthen the control of foreign interests over the power sector. It describes this process as a “cleverly cruel act” in which funds essentially stolen from the poor are used to further consolidate foreign dominance. The statement ends with a pointed question: will the new government, unlike Mahinda and Ranil, choose not to hand over resources alternately to China and India, but instead resolve the ongoing financial crisis by securing national assets?

HERD warns that reliance on Indian projects could result in Sri Lanka paying excessive prices for electricity while India benefits from the arrangement. The statement further said that existing agreements could allow Adani to sell electricity generated in Sri Lanka back to India, thus using Sri Lanka's limited land resources to generate energy. This situation is further exacerbated by recent changes to the Electricity Act, which limit the ability of regulators such as the Public Utilities Commission to challenge these agreements or effectively regulate the sector.

The statement also highlighted a similar situation in Bangladesh, where a deal with Adani resulted in the country buying electricity at higher prices, resulting in significant financial strain. HERD suspects that Sri Lanka could face a similar outcome if current energy policies are not reconsidered.

Adding to the complexity, the statement points out that dependence on Indian energy not only poses a threat to Sri Lanka's sovereignty, but also has economic consequences. The organization criticizes Indian companies for being involved in key energy initiatives such as hydrogen production without any clear plans from Sri Lankan political parties to reverse these processes. According to HERD, the majority of the benefits from these projects are likely to continue to accrue to Indian companies even if a new government steps in, undermining Sri Lanka's energy independence and economic growth.

HERD also questions the ability of Sri Lanka's political parties to resist Indian influence. It pointed out that the Samagi Jana Balawega's political statements on energy also appear to be under Indian influence, even if they do not explicitly state so. According to the statement, this influence enables India to maintain control over Sri Lanka's energy resources, further complicating the country's efforts to become self-sufficient.

The statement alluded to a larger political struggle in which Sri Lanka's future presidents could continue the trend of allowing foreign powers such as India and China to exploit the country's resources. This cycle, HERD argues, would only worsen Sri Lanka's economic problems, including poverty and hunger, making the rich richer and the poor poorer.

HERD's warning comes at a crucial time, as the presidential election may determine the direction of the country's energy policy. The statement stressed that the decisions of this election could have long-term implications for Sri Lanka's sovereignty and control over natural resources. It also criticised the handling of recent events, such as the controversial salary increase for electricity utility employees, which HERD sees as an attempt to appease protests and resistance in the energy sector. This move was portrayed as part of a broader strategy to maintain the status quo and continue the transfer of resources to foreign companies.