Sri Lanka Must Not Forget Its Crisis : Former Indian Economic Advisor Warns Sri Lanka

COLOMBO (News 1st): Former Chief Economic Advisor to the Government of India, Dr. Arvind Subramanian, delivered a stark warning to Sri Lanka: the country must not allow itself to repeatedly fall into cycles of instability that force it back into IMF programmes.

Speaking on Sri Lanka’s economic trajectory, Dr. Subramanian said two images of the island “haunt” him—images tied to the country’s long history of economic volatility and its recurring reliance on the International Monetary Fund.

“Why is Sri Lanka always in IMF arrangements?” he asked.

“Sri Lanka has to liberate itself from the IMF… not because I have anything against the IMF—I worked there—but because Sri Lanka should not have the underlying instability that forces it to rely on the Fund.”

He said this recurring pattern should alarm policymakers and citizens alike.

“It is a pattern, a consistent pattern… something one cannot take for granted,” he warned.

Dr. Subramanian said Sri Lanka’s own economic history offers a critical lesson: stability is fragile, conditional, and must be protected continuously.

“Your history suggests that stabilization is always provisional and intermittent. You cannot take it for granted,” he said.

“You have to work very, very, very hard—all the time—to even maintain stability.”

He added that stabilization and economic growth are not separate objectives but interconnected processes that require sustained attention.

In one of the most striking parts of his address, Dr. Subramanian emphasized the need for institutionalized memory, a mechanism that ensures Sri Lanka never forgets the economic crisis and the mismanagement that led to it.

“Sri Lankan society needs a mechanism, maybe inflation targeting is one, but some socio‑political institutional framework for retaining the memory of that crisis,” he said.

He stressed that unless the country consciously preserves the lessons from the crisis, its vulnerability to future collapse will remain high.

“Unless Sri Lankan society has that etched in its memory, your proneness to future crises will be high,” he warned.

He called on Sri Lankans, from policymakers to civil society, to create and safeguard that collective memory.

Dr. Subramanian noted that remembering the crisis is the foundation of preventing the next one.

“That is the surest way to preserve stability going forward—that you will not have financial instability and so on.”