By Ireshan Siriwardana
The Sri Lanka is preparing for an upcoming presidential election, and as the candidates lay out their platforms, a common recurring topic has been the country’s mineral resources.
Each candidate has been vocal about their plans for effectively managing and leveraging these resources for the nation’s benefit.
This theme has featured prominently in current and past presidential elections, underlining its significance in shaping the country’s future.
Worth billions
The conversation about utilising Sri Lanka’s mineral resources to generate income, establish new industries, and create job opportunities has been longstanding. Despite the extensive discourse, tangible progress in this regard has yet to materialise.
Consequently, there is a prevailing scepticism among some individuals, who perceive Sri Lanka’s mineral wealth as nothing more than a popularised slogan often espoused by politicians.
This scepticism stems from the belief that Sri Lanka lacks the requisite mineral wealth to facilitate significant income generation. While this perspective is certainly understandable, it diverges from the actual reality, which is far more dismal.
Large mineral deposits
Sri Lanka is a geologically rich region blessed with a diverse range of mineral resources. The country’s land is rich in some of the world’s most sought-after minerals, including Ilmenite, Phosphate, Graphite, and others.
These resources have not only garnered international attention but have also been the subject of scientific exploration, revealing the potential for the country to unearth hidden mineral reserves that could contribute significantly to its economy.
It is estimated that the exploitation of these resources could generate several billion dollars annually, offering a much-needed boost to the Sri Lankan economy, particularly in addressing the current shortage of foreign exchange.
Then why is Sri Lanka still unable to take this mineral resource to the world and generate income? Why is it not possible to create new businesses and industries through that?
Sri Lanka has more minerals than Australia
A substantial part of the Australian economy comes from the minerals and mining industry, accounting for a large share of 14% of the country’s gross domestic product (GDP).
However, it has been scientifically confirmed that Sri Lanka’s mineral density and purity are superior to those of Australia. This raises the question of why Sri Lanka cannot solely supply the world market with its minerals.
It is vital to acknowledge that while it is acceptable to criticise incumbent governments and rulers, the government should refrain from participating in commercial activities.
In Australia and numerous other nations, the private sector conducts mineral and commercial mining operations. However, this failure is rooted in an even more distressing and tragic narrative.
Misconduct by Government Officials
The process of issuing licences for mining in the mineral lands of Sri Lanka is overseen by a government agency, and the complete authority of this process lies with its officers.
This system entails the acquisition of an exploration licence before a mining licence. The primary objective of obtaining an exploration licence is to conduct comprehensive research on the presence of minerals in the specific land area, including identifying the types of minerals present, their depth, and purity, before commencing mining operations.
The Geological Survey and Mines Bureau is responsible for issuing these exploration licences. Typically, the duration of such an expedition averages around six months.
Furthermore, once a company secures an exploration permit, the law prohibits any other entity from drilling or exploring the designated land area.
Not even thinking of mining minerals yet
The Bureau of Geology and Mining has issued nationwide exploration licences for mineral-rich areas. The concern is not in granting these licences to the recipients but rather in the extensive duration they are being renewed.
Instead of the standard six-month term, some companies are receiving renewals for ten, twenty, or thirty years. This has resulted in increased excavation activities in these areas, prompting questions about the intentions and practices of these foreign companies.
The largest mineral market belongs to Australia
It’s essential to understand that market prices are determined by supply and demand, which is a fundamental principle of economics.
Australia holds the largest share of the global mineral market. An Australian company has been acquiring exploration permits in Sri Lanka for years and preventing other parties from conducting drilling activities.
Their goal is to control the flow of minerals from Sri Lanka to the world market, maintaining stability in the Australian mineral market.
Additionally, after obtaining exploration licences in Sri Lanka, these foreign companies publicise their activities on their websites and through various media channels, claiming that they are working to bring minerals to the world market to generate significant profits and increase their stock market value.
The stock market is malfunctioning
One of the oldest tactics in the stock market is to artificially inflate share prices by spreading false information through media outlets.
It’s concerning that government officials in Sri Lanka are supporting this fraudulent activity.
Why are exploration licences being granted to these companies for long periods, with renewals occurring annually for what should be a six-month process?
The answer is straightforward. These foreign companies and their local representatives have learnt how to influence the government officials in Sri Lanka.
It’s not a coincidence that the children of high-ranking officials in the Bureau of Geology and Mines are receiving Australian student visas.
In exchange for this national crime, they are selling their integrity at a high price. Recent research indicates that this process has become increasingly complex.
The same company acquires exploration licences under different aliases and frequently changes its own name.
In some instances, it provides financial support to reputable companies in Sri Lanka to obtain exploration licences through them. Its primary objective is to restrict Sri Lanka’s minerals from entering the global market.
This situation is not unique to Sri Lanka
Africa, home to some of the world’s most abundant gold and diamond mines, experiences severe hardship, contributing to its status as the poorest continent. The root cause of this hardship can be mainly attributed to Europeans and Americans’ exploitation of Africa’s mineral resources.
What Australia is doing is very unfair
The Australian government’s actions towards Sri Lanka are a grave injustice. They have prevented access to the country’s mineral market for decades. Nearly every candidate pledges to harness the country’s mineral resources in the presidential election.
However, they don’t realise that neither the Sri Lankan government nor any local company has the right to explore the mineral-rich areas of the country for the next several decades.
A Sri Lankan government agency has granted this right to a foreign company. The leader who takes office on September 22, 2024, will bear the great national responsibility of defeating the powerful forces that obstruct the exploitation of the country’s mineral resources.
Enforcing the law against corrupt government officials will play a key role in achieving this. The vision of unlocking Sri Lanka’s mineral wealth, frequently touted on presidential election platforms, can only be realised if the new leader possesses the necessary knowledge and capability.
This could lead to a significant annual increase in the country’s economy by billions of dollars. Otherwise, if the country’s mineral resources worth billions of dollars continue to be exploited by foreign entities, talk of the mineral dream will remain confined to empty slogans on the 2029 presidential election platform and beyond.
