Sri Lanka’s Armed Forces and ‘Rightsizing’

The Tri Forces and paramilitary groups total more than 350,000, according to publicly available data

• Sri Lanka has the 17th largest military in the world
• Sri Lanka’s 2025 budget has allocated a staggering LKR 437 billion to defense spending which is LKR 12 billion higher than 2024 revised estimates
• In the 1980s, the Army massively expanded from 15000 personnel to over 30000

The President, Anura Kumara Dissanayake, said in the parliament on 28 February 2025 that the Number of persons in all three armed forces will be reduced while they will be made sophisticated with equipment.   “Our aim is to acquire modern equipment for the forces. Almost all aircraft in the Sri Lanka Air Force are becoming outdated. Therefore, we will acquire new aircraft. The Sri Lankan Navy will also get new craft and new equipment. We will do it without any hesitation,” the President said.

The size of the armed forces is a topic of perennial interest and debate as each year’s budget is set. The number of military

President Anura Kumara Dissanayake addressing the Parliament

personnel in each service is directly related to the number and variety of units they can deploy for use in operational missions. The number of personnel also affects the cost of the military. More personnel require additional funding for their pay and benefits; combined into units, they require additional funding for training, operations, equipment, maintenance and travel. The number of military personnel also has a long-term impact on the country’s economy and taxpayers.

THE CONCEPT OF MILITARY POWER

The concept of military power takes into account both the quantity of a state’s resources and its level of economic development. The size of the Army is mainly determined by analysing the internal and external threats the country is facing in addition to various other factors like natural and man-made disasters, population density, size of the country, neighborhoods, foreign policy, etc.
The prime responsibility of the Armed Forces is to provide protection to the citizens and safeguard territorial Integrity and Sovereignty. Taking into consideration the past experiences, including the civil war the Country had to fight in the South and North and numerous factors, the necessity of a sizable and effective Armed Forces is of utmost importance to ensure National security and economic development.

THE BIRTH OF SRI LANKA’S ARMED FORCES

The Sri Lanka Army was born on October 10, 1949, as the Ceylon Army at the end of the Second World War and the dawn of independence to the country. On December 9, 1950, the Sri Lanka Navy Act was enacted and the Royal Ceylon Navy was formed. The Royal Air Force was born on March 2, 1951.

THE THREE COLONIAL POWERS

Ceylon was under three colonial powers: Portugal, Holland and Britain, who were responsible for the defence of the country. The severing of the colonial connection brought this to an end in 1948. That was the time when the founding fathers of the new nation-state gave their minds to the defence needs of the country. Decolonisation after World War 11 was taking place rapidly, but communism was supplanting imperialism, particularly in South East Asia. With this threat perception in mind, a decision was taken to raise professional armed forces to supplement the already existing Volunteer forces of the Army and the Navy. In the interim period of the build-up of these forces to professional standards, a defence pact with Britain was negotiated and signed in 1947. This pragmatic arrangement not only ensured defence against external aggression or internal strife but also provided for the professional training of the personnel and the supply of equipment for the nascent forces. From then onwards, there were numerous occasions in which the Army, in particular, was called out in aid to the civil authorities, especially in 1956 with the promulgation of ‘Sinhala’ only as the official language.

 1971 APRIL – JVP INSURRECTION   

In 1971, there was widespread youth unrest, and for the first time, the Army and the security forces had to face an Armed enemy who also used explosive devices in their operations. The Army was widely deployed, and the Government had to request foreign assistance for manpower and equipment. The assistance requested from friendly nations was generously provided, and the uprising was brought under control in a few months. The overall rough estimates suggest that 8000 – 10000 people died during April of 1971.

EMERGENCE OF LTTE

The Liberation Tigers of Tamil Eelam (LTTE) is a Guerrilla Organisation that sought to establish an independent Tamil state called Tamil Eelam in the northeast of the island. The LTTE was established in 1976 and grew to become one of the most sophisticated and ruthless terrorist organizations in the world.
On July 23, 1983, at around 11.30 pm, the rebel group, the LTTE, ambushed the military patrol in Thirunelveli, near Jaffna in northern Sri Lanka. A roadside bomb was detonated beneath a jeep that was leading the convoy, injuring at least two soldiers on board. Soldiers travelling in the truck behind the jeep then dismounted to help their fellow soldiers. Subsequently, they were ambushed by a group of Tamil Tiger fighters who fired at them with automatic weapons and hurled grenades. In the ensuing clash, one officer and twelve soldiers were killed. A number of the rebels were also killed. This incident sent shock waves around the country and triggered a civil war. This was known as Black July. The Black July was a recruiting agent for Tamil militants and catapulted the country into full-blown war, which lasted 26 years.
It had a drastic demographic effect as hundreds of thousands of Tamils fled abroad.
In 1985, Tamil Guerrillas were in control of Jaffna Peninsula. Subsequently, the LTTE lost control of Jaffna in October 1987 to an Indian Peace Keeping Force that had been sent to Sri Lanka to assist in the implementation of a complete ceasefire.
However, following the withdrawal of IPKF in March 1990, the LTTE grew in strength and conducted several successful guerrilla operations and terrorist attacks. On May 21, 1991, a suicide bomber killed Indian prime minister Rajiv Gandhi while he was campaigning in the Indian state of Tamil Nadu, which was a strategic mistake by the LTTE leader.

THE ARMY STARTED TO EXPAND

The 1980s saw a massive expansion of the Army from 15000 personnel to over 30000. New regiments were raised while others were expanded with new battalions. New weapons and equipment were introduced as the war shifted from counterinsurgency to conventional warfare tactics with multi battalion, brigade and division scale operations.
The major operations conducted by the Army eventually led to the capture of Jaffna and other strongholds. On May 19, 2009, the Sri Lanka Army declared the victory of war as they found the dead body of LTTE leader Velupillai Prabhakaran. This marked the end of the war, with the LTTE ceasing to exist in Sri Lanka as a result of a prolonged military offensive conducted by Sri Lankan Armed Forces.
IMPACT OF CIVIL STRUGGLE ON ECONOMY AND HUMAN RESOURCES
About deaths, the veteran Indian diplomat turned security expert says that between 1983 and 2009, 80,000 to 100,000 people, including combatants from both sides, lost their lives. Among them were 30,000 to 50,000 civilians, 27,693 LTTE cadres, 23,962 Sri Lankan army personnel, and 1,155 men of the Indian Peace Keeping Force (IPKF).
The final stages of the war had created a little over 300,000 refugees or Internally Displaced Persons (IDPs). The war had also left 1.6 million land mines in the Northern and Eastern Provinces. The socioeconomic impact of the unnecessary war was a classic example of mismanagement of politics in Sri Lanka.
Sri Lanka’s 26-year internal war had cost the country around US$ 200 billion, according to India’s former National Security Adviser and Foreign Secretary, Shivshankar Menon. In his book ‘Choices: Inside the Making of India Foreign Policy’, Menon says that this estimate does not include the “opportunity cost” to Sri Lanka, which was once the fastest-growing and the most open economy in South Asia.

THE NAVY

Sri Lanka being an island nation, much emphasis should be placed on equipping the Navy due to the following justifications. It was evident that during the separatist war, Tamil militants were using the sea to get their weapons from other countries. The Sri Lanka Navy was given a chance to show its value only during the last phase of the war in 2006-2009.
Naval actions in this period proved to be invaluable. The Navy, with limited resources, sailed 4000 km deep into the international sea and destroyed 8 LTTE warehouses which carried 100,000 each of 122, 130 and 155mm Artillery Ammunition and 60mm and 81mm Mortar Ammunition. This was the turning point of the war. Sri Lanka has yet to realise that threats to it are not from within its land area but from the sea. Sri Lanka has no land border with any country. Terrorists, smugglers of drugs and humans, pirates and illegal fishers are the new threats emanating from the sea. There is also a vast Exclusive Economic Zone to safeguard. But the navy is ill-equipped to face these threats. The Navy should be equipped with long-range reconnaissance aircraft to carry out reconnaissance of the vast ocean around the island in addition to a long-range radar system. Given the emergence of new forms of warfare, Sri Lanka has to reorient its thinking and put emphasis not on manpower so much but on the acquisition of new skills and equipment. The Indian army, as well as China’s People’s Liberation Army (PLA), have taken steps to make their forces “leaner and meaner”. The Indian ‘Agnipath Scheme’ for temporary recruitment and the modernisation schemes envisaged by China’s Central Military Commission are geared toward achieving that goal. It’s time Sri Lanka followed suit.

THE AIR FORCE

The Sri Lanka Air Force should move away from its erstwhile development of major combat capabilities to focus on maritime surveillance, transportation and territorial protection. As there is hardly any conventional threat either internally or externally faced at present, the necessity doesn’t arise to develop a large fighting force. The Air Force during the war period had more ground troops than technicians and pilots, which needs to change the composition and structure to suit present-day demand.
As part of right-sizing the Air Force, there needs to be maintenance of the already existing aircraft back in the air and acquisition of new aircraft as well to modernise its fleet and enhance operational capabilities to meet future challenges effectively.
In the journey towards sustainable development, it is incumbent upon the SLAF, as guardians of the sky, to protect the airspace over the Indian Ocean to ensure national security and stability.

SRI LANKA’S 2025 BUDGET

Sri Lanka’s 2025 budget has allocated a staggering LKR 437 billion to defence spending—an increase of LKR 12 billion from the 2024 revised estimates, despite the island’s ongoing economic struggles.  The budget, presented by Sri Lanka president Anura Kumara Dissanayake, marks his first since taking office. It includes a significant salary increase for military personnel, with pay hikes ranging from 27% to 33% across different ranks.
The increased military budget raises serious concerns about the government’s fiscal priorities, especially as social welfare funding has been slashed by LKR 35 billion, leaving only LKR 43 billion allocated for crucial public assistance programmes.
The budgetary documents also provide details about funding for separate branches of the Sri Lanka Armed Forces. The biggest recipient is the Sri Lanka Army (SLA), which receives LKR 225.5 billion in the 2025 defence budget, an increase of about 3%. The Sri Lanka Navy (SLN) and Sri Lanka Air Force (SLAF) are allocated LKR 92.5 billion and LKR 72.1 billion, respectively, with increases of 12% and 4%.
These funding allocations include capital expenses. The SLAF received LKR 21.4 billion in 2025 for capital expenses, while the SLN was allocated LKR 19.3 billion. The SLA, by far the biggest service in terms of personnel, receives LKR 5.4 billion in capital expenses. Other recipients under the MoD budget include the office of the minister of defence, the departments of civil security and meteorology, and the Sri Lanka Coast Guard. The latter received LKR 642 million, including LKR 250 million for capital expenditure.

CURRENT ECONOMIC CRISIS AND MILITARY SPENDING

In an attempt to understand Sri Lanka’s current economic crisis, some have pointed to Sri Lanka’s high military spending as one cause of the country’s financial crisis.
As Sri Lanka embarks on this difficult economic recovery, it must rein in military expenditure and address the more dire needs of a suffering population. Sri Lanka, which ranks 58 according to the size of its population and ranks 65 in terms of GDP, has the 17th largest military in the world.  As a percentage of GDP, Sri Lanka spends nearly 2% on military expenses, an extraordinarily high amount for a country that does not face an existential security threat.
In addition, unlike other countries, Sri Lanka does not have a military-industrial sector that produces weapons or ammunition, either for itself or for export. Therefore, much of the capital expenditure incurred by the military is primarily for imports that hardly create any economic activity within the country other than commissions for a selected few.

SRI LANKA’S ARMED FORCES ARE FAR TOO LARGE

Scholars have pointed out that Sri Lanka has an Army far too big for its size and population and has a military that is ill-suited to meet the new strategic needs. It is further noted that, despite this assessment, no meaningful steps have been taken to rationalise the size of the army, which is bigger than the British Army in size and expenditure pattern.
The evolution of a military doctrine suited to emerging threat scenarios is also not evident. Also, the concern is the size of the military in terms of the number of personnel, their salaries and pensions in light of the fact that the separatist war ended 13 years ago.

If Sri Lanka is to be rescued from the economic morass it finds itself in through an International Monetary Fund (IMF) bailout, it needs to reduce its military spending, which stands at LKR 437 billion for the year 2025. Sri Lanka needs to carry out a Strategic Defence and Security Review to reduce its military spending and plan to right size the Armed Forces.
According to Security College Senior Research Fellow Dr David Brewster, “Sri Lanka’s armed forces are far too large and do not have the right focus or equipment. There are way too many soldiers, meaning that money is spent on personnel costs rather than equipment. In order to modernise and refocus on current threats, the Sri Lankan armed forces (principally the Army) will need to be reduced in size, with much greater spending on the Navy and Air Force, with military personnel having much greater technical expertise”.
Sri Lanka is an island state, but its armed forces do not currently reflect this. Institute of South Asian Studies, National University of Singapore points out that despite the end of Sri Lanka’s civil war, Lanka’s defence budget has not seen a significant decline or any major change in its composition. The budgets appear to have no relationship to the emerging strategic environment and risks, and it can be observed that despite the radically altered strategic environment since the defeat of the LTTE in May 2009, defence expenditure keeps on rising annually, which is a burden to the citizens, especially at a time of economic crisis.

NEED OF RIGHT SIZING THE ARMED FORCES

Many intellectuals believe that, even 13 years after the end of the separatist conflict, the military has not significantly reduced its numbers nor restructured itself to suit the different challenges and realities of a post-conflict, democratic country. The Tri Forces and paramilitary groups such as the home guards total more than 350,000, according to publicly available data.
They further argued that as Sri Lanka faces its worst economic crisis in history, it is essential to drastically curtail military spending and prioritise expenditure to ease the burden on the public by providing them essential welfare such as education and health and reducing the tax burden by reducing unnecessary spending. The 2025 Budget should have more seriously considered the impacts of the economic crisis and difficulties faced by the majority.

KEY ECONOMIC REFORMS NEEDED FOR SRI LANKA

According to Talal Rafi and Sirimal Aberatne, Sri Lanka requires wide-ranging economic reforms for long-term sustainable growth to service its debt obligations and to emerge from this crisis stronger. A stable monetary policy is important to keep macroeconomic stability and confidence in the local currency. The current economic crisis Sri Lanka is facing makes it very evident that the continuation of an independent Central Bank is of the utmost importance. An independent Central Bank that can refuse to print money can force the Treasury to take fiscal consolidation seriously. Having more professionals in Central Bank committees and giving them a fixed term can allow them to make long-term policy decisions on interest rates and reserve requirements without political interference.
Tax reforms are essential for revenue-based fiscal consolidation, another prerequisite for economic sustainability. Instead of merely increasing taxes, the government should widen the tax base and implement a system to collect taxes efficiently.
Reform is needed to rein in state expenditure as well. State-owned enterprises (SOEs) are a colossal drain on the state coffers. This has resulted in a deepening fiscal deficit. The management of state-owned enterprises is inefficient as the ruling parties use SOEs for short-term political gains, resulting in a loss of focus on a long-term sustainable strategy for SOEs. As the chairperson and the Board of Directors of SOEs are appointed by the relevant government ministries, they tend to be political party loyalists. This leads to failures and Malpractices in almost all SOEs.

SRI LANKA PUBLIC SECTOR OUTWEIGHS ASIAN PEERS    

Sri Lanka’s public sector employment levels are highest among countries in the South and Southeast Asia region. In 2023, 15% of the total 8 million workforce (1.16 million people) was employed in the public sector, including central government, subnational units, and the military. Notably, Defence and Public Security alone account for one-third of all government employees.
In comparison, countries in the same region with similar economic structures employ far fewer public workers. For instance, India employs 9%, Vietnam 8%, and Bangladesh only 5% of their workforce in the public sector.
This has resulted in high costs, despite the low wages paid to the public sector. In 2023, the Sri Lankan government spent LKR 940 billion, 20% of its recurrent budget and 31% of its revenue, on public sector salaries. Over the past decade, an average of 23% of government spending has gone to salaries, leaving limited funds for vital areas like healthcare, education, and infrastructure.

 THE PRESIDENT’S STANCE REGARDING THE ARMED FORCES   Right sizing the public sector, Armed Forces and Army in particular is a need of the hour, no politician except present president Anura Kumara Dissanayake had the courage to openly declare in the parliament that “The Sri Lanka Army will be confined to 100,000 personnel, Sri Lanka Navy to 40,000 and Sri Lanka Air Force to 18,000,” the President revealed.
The People’s Liberation Army planned to reduce its 2.3 million strong Army to two million and definitely to reform a leaner and mightier force. Indian Army too planned to downsize in areas which are not of operational importance due to budgetary constraints. It was thought practical to not only increase the budget allocation but to right-size the Indian Army.
The Sri Lanka Ministry of Defence needs to appoint a high-level study to determine and recommend a tooth-to-tail ratio, a military term that refers to the number of military personnel it takes to supply and support (tail) each combat soldier (tooth).
The utmost important aspect of economic reform will be the right sizing of the 1.16 million public sectors, the armed forces and the army in particular within the next 5 to 7 years without harming them and their families. It cannot be accomplished hurriedly but necessitates an empirical method. Sans the aforementioned constituent, economic reform will only be an elusive dream, and none will be able to rescue Sri Lanka’s already collapsed economy. Despite the differences of political opinions, the President’s decision to right size the Armed Forces must be appreciated and supported by all.
The writer is an Infantry officer who served the Sri Lanka Army for over 36 years, a former Security Forces Commander of the Wanni Region and Eastern Province, and he holds a PhD in economics.

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