The Sri Lankan government has imposed an emergency after countrywide protests erupted due to the economic crisis. President Gotabya Rajapaksa of the Island nation invoked the tough laws after protesters tried to storm his house amid the worsening economic situation. The security forces have been given all the power to control the situation in the country. The president claimed that an emergency was declared in order to protect public order and maintain supplies and services essential to the life of the community. Nighttime curfews have also been placed and certain no-go zones have been created. Soldiers armed with automatic rifles are posted at many places for crowd control. The whole region is participating in anti-government protests as they have had enough of the policies that yield disappointing results. Sri Lanka is in the worst economic crisis as of now. The country’s power company has announced a 13-hour power cut due to the shortage of electricity, which has occurred because of high fuel costs and a lack of rains that led to dry reservoirs. The government has also bled out almost all the funds from the foreign reserves, which is why it is unable to purchase more fuel from abroad. The country is facing one of the highest rates of inflation at 17% and a steeply devalued currency, both of which have made life extremely difficult for the common man. Due to the crisis, the government is running low on foreign currency which has made paying for essential imports extremely difficult. This has created a shortage of food, fuel, and other essential items. This shortage has driven up prices and increased the inflation rate to unprecedented levels.
The crisis can be attributed to economic mismanagement by successive governments and poor decision-making such as tax cuts right before elections and banning the use of fertilizers. Moreover, the Sri Lankan economy also took a hit in the Covid-19 pandemic as tourism is one of its major sources of revenue. Additionally, Sri Lanka is also under a debt of $7 billion dollars. The country has become dependent on foreign loans and China for investments in infrastructure projects much like Pakistan. Although Pakistan is not in such deep waters yet, it can learn a lesson and move towards creating opportunities for the betterment of the Pakistani economy. The country is facing high inflation levels and an ever-increasing problem of debt. Moreover, with an unstable government, the economic situation will further worsen and foreign investment opportunities will be lost. Pakistan too, like Sri Lanka, is dependent on China for much of the aid and economic relief. In addition to that, China has invested in Pakistan to build many projects including the CPEC which is yet to yield any results for Pakistan. If Pakistan learns any lesson from the current economic crisis in Sri Lanka it must be that the country should create economic opportunities that empower the nation and relieve Pakistanis of being dependent on countries like China and financial institutions like the IMF.