Government officials involved in the recent coal procurement process came under the scrutiny following recommendation of the unexpected administrative action Committee on Public Finance after considering the revelation of irregularities in the tender procedure, official sources said.
With the revelation of tender bending in a report submitted by Sri Lanka’s auditor general’s department, the parliamentary Committee on Public Finance (COPF) has recommended that action be taken against officials who oversaw a 2022-2025 coal tender for the Norochcholai coal power plant.
Minister of Power and Energy Kanchana Wijesekara in his reply in parliament on Tuesday October 04 has requested the committee to consider the officials’ version of events before making recommendations.
“The Auditor General has reported that the tender to procure coal for the Norochcholai power plant from 2022 to 2025 did not follow the approved procurement process,” COPF chairman and opposition MP Harsha de Silva said in parliament.
“The objective of the procurement process, which is giving the maximum equal opportunity for the firms that are qualified and interested parties to participate in the tender, has been broken.”
The company that was awarded a contract to supply coal on credit has refused to go ahead until legal clearance is given after the deal ran into controversy and some activists went to court.
Black Sands Commodities FZ LLC based in the UAE was given the deal to supply 4.5 million tonnes of coal from Vanino Port, Russia.
It was supposed to supply coal at a base rate of 295.22 US dollars and 33 dollars a tonne for freight.
The deal was supposed to be for seasons 2022-2023, 2023-2024 and 2024-2025. Critics have said the price was too high.
However, after Black Sand Commodities FZ-LLC was awarded at 328 dollars per tonne of coal, a consortium of Brown Investment and China Machinery & Engineering Cooperation (CMEC) came up with another bid and said it could supply coal from $285-$290 per tonne.
In early September, COPF agreed to conduct an investigation into the case following a request by Minister Wijesekara who said false allegations leveled against the awarded tender had led to questions of transparency and pricing.
“This coal tender was called and was awarded to Black Sands. The issue was this company was not a registered company. The registered company was a company called Suek AG,” said de Silva.
“Then how was the tender awarded to an unregistered company? This is beyond our spectrum therefore we called in the Auditor General.”
Tabling the final report of the AG, de Silva said it was made after discussions with the Ministry of Finance and the Secretary to Ministry of Energy and Petroleum.
During the audit, the tender that was awarded to Black Sand was canceled and the Lanka Coal Company called for a fresh international tender to purchase coal on September 23.
Based on the AG report and discussing it with the members of COPF, de Silva said, the committee recommended that the officials involved in the procurement process should be banned for at least a year from going into another procurement process.
However, objecting to the recommendation, Minister Wijesekare said there were limitations when conducting the audit and the officials who participated in the procurement process had offered an explanation to the auditor general which must be considered by the committee.
The committee should listen to the officials rather than make recommendations that could unfairly implicate those who participated in the procurement.
Replying to the minister, de Silva said COPF will no longer intervene in the case and further investigation should be done through the Committee on Public Enterprises (COPE) and Committee on Public Accounts (COPA).
Government officials get the blame for Coal Tender bending
BOI reveals export earnings of existing enterprises following the COPF bashing
In the wake of annihilation from the Committee on Public Finance (COPF) over the failure to provide a proper analysis on 12 year tax holiday and other concessions to be given to a company and later getting the green light for it, the Board of Investment (BOI) has made public the details of export earnings of its existing enterprises.
The extremely poor state of affairs in granting tax concessions transpired when the BOI officials failed to justify why HCL Technologies, an India-based tech company, which already has commissioned operations in Sri Lanka and COPF has denied the approval of the relevant order on Monday(03).
The (COPF) has approved the Order under the Strategic Development Project Act, No. 14 of 2008 published under the Extraordinary Gazette Notification 2291/25 after the Board of Investment (BOI) provided a proper analysis earlier yesterday (Tuesday04).
HCL Technologies first entered Sri Lanka in September 2020 commissioning its Global Development Centre and the following year in August 2021, they entered into an agreement with Sri Lanka’s John Keells PLC to occupy 80 percent space in their 30-storey Grade A office building
However, the BOI, which is entrusted with the task of investment promotion , should come up before the public by revealing its contribution for the promotion and attracting FDI in to the country during past two years in order to clear its image already tarnished by its poor performance before the COPF, several economic analysts said.
BOI enterprises accounted for US $ 6.6 billion of merchandise exports during the January-September period, up 16 percent compared to the corresponding period of 2021, the apex investment promotion agency said.
According to the Export Development Board data, the merchandise export income to Sri Lanka during the January-August period was US $ 8.8 billion, up 12 percent from a year ago.
The export data for October are yet to be published. According to the BOI, 15 key performing sectors, which have shown over 19 percent of average growth in exports during the said period,
“The BOI has always been the forerunner of Sri Lanka’s export industry, contributing over 65 percent to the country’s overall export earnings and 85 percent to the national industrial export earnings,” said BOI Chairman Raja Edirisuriya.
Meanwhile, he said the BOI is currently focusing on both short-term as well as long-term strategic measures, which would result in increased FDI inflows to the country.
“As a short-term strategy is to attract the much-needed FDI, attracting and facilitating reinvestment by existing companies while repositioning Sri Lanka as a high-tech FDI destination based on Industry 4.0.
It is also developing new zones dedicated to priority sectors and digitisation of the entire investor experience to ensure seamless delivery of services to investors can be identified as long-term strategic initiatives,” Edirisuriya underlined.
BOI Director General Renuka M. Weerakone remains positive about the investment targets set for this year with the expected easing in the ongoing economic crisis.
All these are pep talks but no results and no performance, a leading economic analyst who is very familiar with BOI affairs said adding that Sri Lanka will not face the bankrupt situation and dollar crisis if this institution fulfilled its obligations in the past and present .
Unseen side of President’s rumoured meeting with ex CBSL Chief
Following Samagi Jana Balawegaya (SJB) MP S.M. Marikkar’s allegation in Parliament yesterday (04) that President Ranil Wickremesinghe during his recent visit to Japan met with former Governor of the Central Bank of Sri Lanka (CBSL) Arjuna Mahendran and had lunch and the President’s strong denial on such a meeting being ever taken place, a number of questions begin to surface on the sidelines of the economic meltdown befallen the island nation.
Sri Lanka is suffering from its worst economic crisis since independence, and Marikkar’s keenness to raise so much controversy amidst a million unanswered questions leading to how the recession can be recovered would be problematic, given the nature of his allegation suggesting as if the President has committed a great crime against the very fabric of Sri Lanka’s continuity amidst such hardship.
Elaborate as to why his allegation would be problematic, first we need to understand who Arjuna Mahendran actually is, what was the crime he committed and what is wrong with any event him meeting the President.
Had the President met with someone who was designated as a ‘convicted criminal’ before the Court of Law, that would be wrong of all sorts. Any meeting in a private space would be considered private, regardless of the individual’s history, but even for a President, meeting an underworld kingpin or an infamous assassin, who is yet to be charged or convicted, would be morally very wrong.
But who is Arjuna Mahendran?
Mahendran was never convicted before the Court of Law, nor was he an underworld kingpin (or an assassin for that matter) morally disgraced by the people of Sri Lanka. Mahendran’s name, among other things, is primarily affiliated with the 2015 great Central Bank Bond Scam, but he was never convicted for an offence.
But it is customary for Sri Lanka to try and convict those accused of crimes before the Media instead of the Court of Law. Such cases are being handled by the Media in a manner in which a political power is directly behind the curtain to proclaim the verdict in advance. A part of the people of the country accepts the verdict regardless of the legitimacy.
The Sri Lanka Police obtained a ‘red warrant’ against Mahendran, but under which legal provision was the warrant obtained was never publicly disclosed.
The ‘red warrant’ is the highest of all warrants. In general practice, a ‘red warrant’ is obtained against a convicted criminal or a fugitive criminal. Generally, a ‘red warrant’ can be obtained against a person involved in crimes such as drug trafficking, arms dealing, money laundering and human trafficking, and the International Police (INTERPOL) enforce such warrants considering that there is a danger of the criminal committing the same offence again.
However, the manner in which Mahendran was issued a red warrant belonged to neither. Then why did the Sri Lanka Police obtain a red warrant against the ex CBSL Chief in the first place?
There are also other warrants, such as ‘yellow warrants’ and ‘blue warrants,’ which are usually obtained prior to the issuance of a red warrant. But in this case, the Sri Lanka Police have clearly violated the procedure in which an International Red Warrant is obtained by bypassing the protocol and resorting to the latter. The Sri Lanka Police proceed themselves with the notion that their conduct is correct, given that these have not yet been challenged before an international court.
Were these commissions to be properly challenged, chances could be high that the INTERPOL step in to completely ban the use of red warrants for Sri Lanka. In retrospect, Sri Lankans who were issued red warrants but later dropped not challenging such conducts of the Police (or even those of the INTERPOL) before a local or an international court would be a terrible incitement for the Sri Lanka Police to continue the misuse of red warrants.
Coming back to the case of Mahendran, who was neither an underworld kingpin nor a hired assassin to be unconditionally and morally considered dangerous and therefore entitled to a warrant of this nature, the Government of Singapore denied the extradition of the former CBSL Governor as expected by the Sri Lankan law enforcement officers. Why?
During the previous Rajapaksa regime, the authorities made a strong effort in this regard, but the Singaporean Government denied the request, based on a thorough study into the whole incident, which convinced them to believe that this arrest, by definition, was a ‘political witch-hunt.’
Recalling a very simple example related to this, on February 04, 2018, the Criminal Investigation Department (CID) accompanied by journalists from ‘Sirasa TV’ Channel raided Mahendran’s residence. The act was singlehandedly committed by the Police on the orders of the then President Maithripala Sirisena who did not even bother to consult the former CID Chief Ravi Seneviratne. The entire operation was handled by Kili Maharajah, the media giant who owned Sirasa, on Sirisena’s wishes. LNW disclosed this incident with photographic evidence of Maharajah personally navigating the entire operation over the phone nearby.
Alas, nobody seems to remember these now..
There are many other incidents that are yet to remember. Stay tuned for more…
Kabir Hashim appointed as the chairman of COPA
Kabir Hashim, member of parliament of the Samagi Jana Balavega, has been appointed as the chairman of the Committee of Public Accounts(COPA).
Prasanna Ranatunga, the chief organizer of the ruling party, stated in Parliament today (05) that an agreement was reached in this regard according to the instructions of the President and the Prime Minister.
Litro gas prices reduced
Litro Gas Company has decided to reduce the price of domestic gas cylinders with effect from midnight today (05).
Accordingly, the price of a 12.5 kg gas cylinder has been reduced by 271 rupees and its new price is 4280 rupees.
The price of a 5 kg gas cylinder has been reduced by Rs 107 and its new price is Rs 1720.
Also, the price of a 2.3 kg gas cylinder has been reduced by 48 rupees, and its new price is 800 rupees, said Muditha Peiris, chairman of Litro Gas Company.
Cabinet approves submission of 2023 Appropriation Bill to Parliament
The proposal submitted by President Ranil Wickremesinghe as the Minister of Finance, Economic Stabilization and National Policy to submit the Appropriation Bill for the financial year 2023 to the Parliament has been approved by the Cabinet.
The total recurring expenditure for the year 2023 is estimated at Rs 4634 billion and the total capital expenditure is estimated at Rs 3245 billion.
Accordingly, the Cabinet Spokesman, Minister Bandula Gunawardena stated that after consideration by the Cabinet, the draft bill prepared including the draft budget estimates for each budget was approved for submission to the Parliament.
Appointment of Chairpersons for COPE and COPA Committees due today
The newly appointed Committee On Public Enterprises
(COPE) and the Committee on Government Accounts (COPA) Committee are scheduled to meet today (05).
These committees are meeting for the first time for the third session of the Ninth Parliament.
Accordingly, the committee meeting is scheduled at 11.00 am today at the Parliament complex, where the chairpersons for the committee are to be appointed.
Although the Samagi Jana Balawegaya has continuously demanded that the chairmanships of both these committees be given to the opposition, there has been no positive response from the ruling party so far.
SRI LANKA ORIGINAL NARRATIVE SUMMARY: 05/10
- PM Dinesh Gunawardena informs Parliament that there is only a “draft” agreement with IMF: agrees to submit it when finalized, to relevant Parliamentary Committees: on 1st September, it was reported that IMF staff and Sri Lankan authorities have reached a staff-level agreement with a 48-month arrangement of about USD 2.9 billion.
- Cabinet approves draft Appropriation Bill for 2023:
Recurrent Expenditure Rs.4,634 bn: Capital Expenditure Rs.3,245 bn. - Stock market trading halted for 2nd consecutive day due to the S&P SL20 index dropping over 5% from previous close: ASPI dips by 413 points (4.28%) to 9237: S&P SL20 drops by 174 points (5.70%) to 2875.
- World Bank Country Director Faris Hadad Zervos says he admires the commitment and measures taken by the Government to overcome the economic crisis.
- Committee on Public
Finance chaired by SJB MP Harsha de Silva refuses to approve Order under the Strategic Development Project Act which was scheduled for debate in Parliament: claims
Board of Investment failed to provide a proper analysis on the matter. - Capital market regulator SEC acts against 16 persons for misconduct that is said to have taken place in the past: such persons warned or subjected to compounding, without an admission of liability, as provided in the SEC Act.
- Secret PR campaign said to have been started to clear image of former President Gotabaya Rajapaksa: aim of campaign said to be to convince people that he was misguided in making crucial decisions, by those close to him.
- Cabinet spokesman Dr Bandula Gunawardena says the Government will provide lunch for another 1 million school students, with immediate effect.
- In an election in Parliament to choose the Chairperson for COPE, SLPP-led Government will field SLPP MP Professor Ranjith Bandara: SJB nominates MP Eran Wickramaratne.
- Former President Maithripala Sirisena joins farming community protest organized by the SLFP in Polonnaruwa: Sirisena’s son Daham who is SLFP’s West Polonnaruwa Chief Organiser also joins.
Cement prices reduced!
Ince and Tokyo Cement companies have decided to lower the price of a 50 kg cement bale by 100 rupees effective from midnight yesterday (04).
According to this, the new price of cement types of Inc Corporation, Inc Mahaweli Marine, Tokyo Super and Nippon, which was Rs 3,200 till now, will be Rs 3,100.
The companies say that they are working to reduce the price of cement in order to support the growth of the construction industry.
An announcement from the Meteorological Department about the heavy showers
The Department of Meteorology says that a temporary decrease in the heavy rain conditions is expected today (05) and in the next few days.
The department states that there will be several periods of rain in Western, Sabaragamuwa and North-Western provinces and in Kandy, Nuwara Eliya, Galle and Matara districts today.
Also in Uva, Eastern and Northern provinces there will be scattered rain or thundershowers in the evening or at night.
The department kindly requests the people to take necessary measures to reduce the dangers caused by temporary strong winds and lightning that may occur with thunderstorms.