With thousands of protesters on the streets of Colombo, soaring food and fuel prices and this week the first-ever suspension of government bond payments, Sri Lanka’s escalating economic crisis has shaken the governing Rajapaksa family’s grip on power.

But while demonstrators accuse Gotabaya Rajapaksa of mismanaging the economy, the president’s elder brother, prime minister Mahinda Rajapaksa, has accused restive citizens themselves of deepening the island nation’s financial plight.

“Friends, every second you protest on the streets our country loses opportunities to receive potential dollars,” Mahinda Rajapaksa, who previously served as president from 2005 to 2015, said in a broadcast address on Monday.

The prime minister’s remarks highlighted the gulf between the Rajapaksa family and the increasingly frustrated Sri Lankan public.

With the country’s foreign reserves falling below $2bn, a dollar squeeze has dramatically curbed vital imports. Shortages of basic commodities, from diesel to medicines, and rolling electrical blackouts have stoked weeks of protest.

On Tuesday, the financial ministry suspended payments on the sovereign’s foreign debt for the first time, saying it had to dedicate scarce currency reserves to food and fuel and asking creditors for time to restructure $35bn in loans and bonds.

As Sri Lanka negotiates with the IMF on a debt relief package and looks to India and China for help, the protest movement has become the most severe challenge yet to a president once seen as a war hero but now widely blamed for the crisis.

“We want the Rajapaksa family to leave the government,” said Raghavi, a lawyer protesting in Colombo’s Independence Square, who asked to be identified only by her first name.

The protests have gained in size and momentum over the past few weeks as the population of 22mn is engulfed in a cost of living crisis. Demonstrators have chanted “go home Gota!” outside the president’s Colombo residence and gathered around the prime minister’s country villa.

In an abortive attempt to quell the protests, security services deployed tear gas and water cannons and the president on April 2 ordered a ban on social media and declared a state of emergency — only to revoke the controls three days later.

A panel of UN human rights experts last week condemned the internet blockages and violence against protesters. “We urge the Sri Lankan government to allow students, human rights defenders and others to protest in a peaceful manner, and to freely share their political views and express their discontent, both online and offline,” the panel said.

As president and defence minister respectively, Mahinda and Gotabaya ended Sri Lanka’s 26-year civil war in 2009, crushing the Tamil insurgents.

Mahinda Rajapaksa was voted out of office as president in 2015 amid public perceptions of corruption and authoritarianism in his administration. But following the devastating 2019 Easter Sunday terror attacks that killed more than 200 people, Gotabaya Rajapaksa became the first former military officer to be elected Sri Lanka’s president.

Before the current crisis, members of the Rajapaksa family headed up a third of Sri Lanka’s 28 ministries, including Mahinda as prime minister, a brother Basil in charge of finance and another brother Chamal holding the irrigation portfolio.

Basil, Chamal and Namal Rajapaksa, who is Mahinda’s son, resigned with other members of the cabinet on April 3, but Mahinda remained as prime minister and Gotabaya retained the defence portfolio, which did not appease many protesters.

“We expect a change in the entire system, not just cosmetic changes with a small shuffling of chairs,” said a Catholic priest at a Colombo protest, who asked not to be named out of fear of repercussions. “The whole future is bleak.”

When elected, Gotabaya Rajapaksa promised to deliver a “prosperous nation”, primarily by slashing taxes. But the cuts were made just before the coronavirus pandemic plunged the world into economic turmoil.

With its revenues slashed and credit rating falling, the government struggled to refinance its foreign debt.

Thanks to the economic crisis, Gotabaya Rajapaksa “went from hero to zero in a very short period of time”, said Murtaza Jafferjee, chair of the Advocata think-tank. “He doesn’t understand too much economics, so he left it to his economics team that made disastrous decisions.”

The Sri Lankan rupee has fallen more than 37 per cent against the dollar this year and food prices in March leapt 30 per cent year on year. To support the rupee, Sri Lanka’s new central bank governor P Nandalal Weerasinghe on Friday raised deposit and lending rates by 7 percentage points.

Around $3.5bn of Sri Lanka’s outstanding loans, about 10 per cent of the total, are to China. India stepped in to provide a $1bn credit line in March, but analysts have said an IMF programme was vital to unlocking more aid.

Gotabaya Rajapaksa seems determined to remain in office. “The president won’t resign for any reason, we will not be cowed by protests,” government whip Johnston Fernando told parliament.

But there have been signs of dissent within the house of Rajapaksa.

“I will never condone the blocking of social media,” tweeted Namal Rajapaksa on April 3, using a virtual private network to get around the government social media blockage a day before he resigned as state minister for digital. “I urge the authorities to think more progressively and reconsider this decision,” he said.