Sunday Observer Online


Sunday, 05 June 2016





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Chinese builder to India to woo investors :

Indians to invest in Port City project

CHEC Port City Colombo, the company handling the much-talked-about Colombo Port City project, pulled off a masterstroke last week, when it approached several top Indian companies to invest in the project.

This was a highly significant achievement in terms of geo-political relations concerning India, China and Sri Lanka.

The previous administration launched the multi million-dollar Port City project amid claims on China’s increasing activity in the Indian Ocean, and Sri Lanka’s strategic positioning between the Strait of Malacca and China’s new base at Djibouti.

In this context, many analysts opined that the Port City was not only a construction project; but also a barometer of Chinese influence in the South Asian region where India is a key player. It was quite obvious that India was “sensitive” about developments on the Port City front, under the Rajapaksa administration.

Indian orbit

It does not require a lot of wisdom to understand that the tangled history of port city, especially over the past 16 months, is proof to the limits of India’s ability to project power in the region. But, it is still a question whether India’s attempt to bring Sri Lanka more firmly back into its orbit can match for China’s greater economic power across the globe.

During the Rajapaksa administration, China became Sri Lanka’s largest investor and largest creditor. The previous government often came under criticism for recklessly accepting financial support from China, turning a blind eye to its political repercussions. In 2013, when the Rajapaksas were at the helm, China provided 21 percent of foreign loans and grants to Sri Lanka, and by 2015 Sri Lanka owed China between $3.8 and $5 billion dollars. In 2014, Sri Lanka allowed Chinese submarines to dock at Colombo without giving India prior notification. This practice, needless to say, earned India’s ire and it strained Rajapaksa’s relations with the regional giant.

After the launch of the Port City project, in 2014, speculation was rife that India might have problems with the Chinese-funded project, mainly due to its security concerns. Even the Indian media repeatedly said the Indian government and its policy makers were keeping a close eye on the port city project as it was “intertwined” with the sub continent’s security concerns. It was against this backdrop that the Chinese company handling the projected chose to ‘market’ the Port City project in India.

In a major turn of events, CHEC Port City Colombo (Pvt) Ltd, Sales and Marketing Head, Liang Thow Ming left for India last week to conduct discussions with potential Indian investors.

The meetings were facilitated by John Lang Lasalle (JLL), a well-known real estate broking firm, which already has a modest presence in Sri Lanka. It was the first time the company went on to launch a region-specific marketing exercise to rope in potential investors for Colombo Port City, a project that was at the centre of a major controversy 16 months ago.

Indian investors

As an outcome of the company’s interactions with Indian investors, five Indian companies have expressed willingness to invest in the Colombo Port City. Three of them, according to informed sources, already have business interests in Sri Lanka.

“Our interactions with Indian businessmen were highly successful. We received a warm welcome in India. Our decision to engage with Indian businessmen was purely a marketing strategy. We want the Port City project to deliver results,” Ming told the Sunday Observer.

However, many economic analysts told the Sunday Observer that the company’s move to interact with Indian businessmen was a ‘smart move’ to allay India’s fears over the project.

“When India develops business interests in the project, they will not be in a position to resist the Port City over geo-political concerns. Approaching India to invent in the Port City is a masterstroke from a strategic point of view. On the other hand, it ensures a win-win solution to all stakeholders,” a prominent economist, who closely studied the Port City project from the outset,said.

The Chinese company and the Urban Development Authority have formulated the mechanism to approve investment for the Colombo Port City. The UDA, the body representing the Sri Lankan government, will function as the final approving authority, as far as the investments are concerned.

“However, every investment will have to be ratified by the Chinese company as well. When giving the final green light, the UDA will take the Chinese company’s endorsement into consideration. At the same time, to fast track the operations of the project, the UDA has already formed a special unit, especially dedicated for the Colombo Port City,” a highly placed government source told the Sunday Observer on Friday.

“The company and the Sri Lankan government are looking at the project from a commercial perspective. When roping investors for the Port City project, we won’t worry too much about their nationality. Everyone will be assessed based on their competence, scales of their investments and their willingness to adhere to our standards and regulations. The selection process will be very objective and transparent,” he further added.

“In addition to India, we believe the Colombo Port City will be an exciting project for South East Asian investors who are now venturing into global investments. On the other hand, Western countries too have an opportunity to join hands with the project,” he said.

The Chinese company’s move to approach Indian investors is a clear indication that the future of the project is not bleak. The company is convinced that the project will materialize and the money will flow in.

“The problems concerning the Colombo Port City project are not political or economic issues. They are merely technical problems that can be sorted out through negotiation. For instance, compensation for delaying the Port City project is one such problem.

Discussions are currently underway between the Sri Lankan government and the Chinese authorities to troubleshoot this issue and arrive at a win-win solution. But the nature of the win-win solution cannot be disclosed, at this juncture,” an authoritative source who is privy to discussions between the two parties said.

Thilina Gamage affair

Colombo Additional Magistrate Thilina Gamage became a newsmaker over the past few weeks over a court case involving a baby elephant.

The Additional Magistrate, whose service has been suspended by the Judicial Service Commission, avoided the country’s law enforcement authorities for nearly two weeks, without giving a statement to the Criminal Investigations Department over the matter.

Although the Colombo Chief Magistrate ordered Gamage to give a statement to the CID over the baby elephant’s issue, the Additional Magistrate failed to make an appearance before the investigation team . Multiple attempts made by the CID to contact the Additional Magistrate over the phone proved futile as his mobile phone was switched off. As a result, some sections of the media went on to say that the Additional Magistrate was “absconding”.

A few days later, however, Gamage broke his silence, when he filed an anticipatory bail application in Court to prevent the possibility of his arrest on charges of a non-bailable offence.

In his application filed before Gangodawila Magistrate’s Court through Senior Counsel Ajith Pathirana, the Additional Magistrate cited the Criminal Investigations Department (CID) Special Investigations Unit OIC as the respondent.

He also informed Court that there was an attempt by the CID to arrest him over the alleged possession of an elephant without a valid license.

Gamage informed the Magistrate that a team of CID officers had arrived at his house in search of him and harassed his mother. He moved Court to grant him anticipatory bail.

When this application was taken up for hearing before the Maligakanda Magistrate, it was revealed in court that the CID had not named Gamage as a suspect in the case.


At this point, in another interesting turn of events, the Attorney General reprimanded the CID for their failure to name Gamage as a suspect in the baby elephant case, despite the AG’s department’s instructions issued 18 days ago!

The lawyer representing the Attorney General asserted that the CID Director should be held responsible for the department’s failure to name Gamage as a suspect in the case.

However, President’s Counsel Ali Sabry with Senior Counsel Ajith Pathirana and Harith Hettiarachi appearing for the petitioner gave an interesting ‘twist’, alleging that the CID was deliberately reluctant to name their client as a suspect since the CID wants to deprive his rights guaranteed for a suspect.

“The CID wants to arrest our client with handcuffs. Three other people connected to this incident have been named as suspects. Why do they act in a different manner to Magistrate Thilina Gamage?” they questioned. It looked as if the CID, which handled investigations into matter, was receiving cannons from both sides.

Senior State Counsel Dileepa Peiris submitted to Court that the behaviour of Magistrate Gamage during investigations was not exemplary as a Judicial Officer, since he had evaded CID on several occasions.

At this point, Maligakanda Magistrate Kanishka Wijeratne postponed the hearing into anticipatory bail application for June 2 after the petitioner’s counsel requested for a further date stating that they wanted to discuss the matter with the Attorney General.

When his attempt to get anticipatory did not bear fruit, Gamage surrendered to Court, on Thursday, over the alleged possession of a baby elephant without a valid license.

Raising eyebrows of some, Gamage was released on cash bail of Rs. 500,000 with four sureties of Rs. 2.5 million. The Court further issued an order directing the Controller of Immigration and Emigration to prevent the suspect from leaving the country.

He was was also ordered to appear before the CID on the last Sunday of each month and further directed him to give a statement to the CID on June 7. The magistrate maintained that it is unreasonable to remand the suspect until the conclusion of the inquiry since the matter does not come under the Public Property Act.


The value of the elephant calf was estimated at Rs. 6.9 million.

Issuing an order directing to release the suspect on bail, the Magistrate observed that the elephant calf in question can be considered as a public property since the Wildlife Director General had issued a license on a previous occasion.

The magistrate set aside the prosecution’s claim that the suspect would interfere with the witnesses in the case and observed that he would not be able to do so as he had been suspended from the service by the Judicial Services Commission (JSC).

Senior State Counsel Dileepa Peiris appearing on behalf of the Attorney General informed Court that the suspect cannot be released on bail unless there are exceptional circumstances since the allegations were leveled under the Public Property Act.

Peiris again informed Court that the Attorney General had given instructions to the CID on May 12 that Gamage be named as a suspect and steps be taken to produce him in Court for allegedly possessing a baby elephant without a valid licence. He said following the amendment of the Fauna and Flora Protection Ordinance in 2009, elephants are considered as public property.

He said Chandraratne Bandara Yatawara was the first owner of the elephant calf named Sakura (Reg. No. 334). The SSC said according to available documents, Chandraratne Bandara Yatawara who claimed himself as a traditional and long-standing elephant owner had submitted an application to the Wildlife Department for a licence for a three-year-old female elephant in 2008.

Elephant owner

Peiris said investigations revealed that the person called Yatawara was not a ‘traditional elephant owner’ but a welder who struggled to make ends meet. He said the elephant calf was not a female as mentioned in the application.

President’s Counsel Ali Sabry with Senior Counsel AjithPathirana appearing on behalf of Additional Magistrate Thilina Gamage made a bail application citing that the suspect can be released on bail after taking into consideration the provisions of the Bail Act. They said Court should apply the judicial mind rather than the version of the prosecutors who demand to remand a suspect.

They further argued that Court should not issue remand orders for the satisfaction of police officers. Meanwhile, the defence decided to withdraw its anticipatory bail application filed by the suspect last Friday to pre-empt the possibility of his arrest on charges of a non-bailable offence.

Meanwhile, another drama unfolded amid the hearing of the case when a group of lawyers who supported Gamage attempted to interrupt State Counsel Pieris appearing on behalf of the Attorney General’s Department.

Pieris, responding to attempts of interruptions, said he would not be intimated by those wearing ‘black coats’.

However, the ‘courtroom drama’ that unfolded on Thursday was quite intense.

The Additional Magistrate, clad in his cloak, sat among lawyers appearing for the case. When he appeared before the Magistrate, he gave his cloak to a lawyer who sat next to him. The Additional Magistrate was seen wearing a pale green shirt and a red colour tie, during the court proceedings.

Interestingly, some supporters of Gamage, who identified themselves as lawyers, prevented journalists from taking pictures of the Additional Magistrate, on Thursday. The Magistrate, who did not want to face media queries, used the rear entrance of the court, when he left the premises after the hearing.

No-Confidence Motion

While the government is looking for a escape route from the current economic mire, Finance Minister Ravi Karunanayake is preparing himself for a fresh challenge.

The no-confidence motion, presented against him by the UPFA rebel faction in Parliament, is due to be taken for debate in Parliament after June 6.

When Parliament convenes on June 6, Speaker Karu Jayasuriya will give a date for the debate. The no-confidence motion focuses on the present economic situation of the country, the increase of taxes, the proper management of the country’s economy and, the Central Bank’s bond issues.

The no-confidence motion against the Finance Minister, quite obviously, will be a news-making opportunity for the UPFA rebels, who call themselves the ‘Joint Opposition’. UPFA MP and former Minister C.B. Ratnayake openly requested all Parliamentarians to support the no-confidence motion against Karunanayake.

“If all the public representatives in parliament love their country they should definitely support the no-confidence motion,” Ratnayake said.

However, it is crystal clear that the UNP MPs and the SLFP MPs supporting President Sirisena will not vote in favour of the no-confidence motion. Although the JVP says it has not made a decision on the matter, some argue that the JVP and the TNA may not align themselves with the ‘Joint Opposition’ group, during the no-confidence debate. The UPFA rebel faction’s strength in Parliament is less than 50 seats, and in that context, the motion is likely to end up as a damp squib.

Central Bank Governor

Meanwhile, Central Bank Governor Arjuna Mahendran too will officially end his first term this month. The JVP, the Joint Opposition group and some civil society groups have openly urged the government to refrain from re-appointing Mahendran as the Central Bank Governor. Some civil society groups who have declared war on the Central Bank Governor are the ones who supported President Sirisena at the last Presidential election.

However, it is quite apparent that Mahendran is heavily backed by the UNP, the largest stakeholder of the national unity government. Against this backdrop, Mahendran stands a strong chance of securing his position.

On the other hand, the SLFP MPs representing the government have still not taken a strong stand against the Governor, probably due to fears that such demands would ‘upset’ the apple cart. But the final decision on Mahendran’s appointment will be made by the President, who himself is an SLFPer.


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