Houses for NE war-affected: Rejected French firm's agent now agent for Chinese company

Since 2015, the Resettlement and Reconstruction Ministry has floated two proposals for housing on a massive scale for the war-displaced in the North and East. Both are fronted by a single local agent who floated two companies, one as recently as January 2018, to manage the projects.

The Ministry first attempted to grant a contract for 65,000 prefabricated dwellings to French steel giant ArcelorMittal. This initiative was only recently abandoned after strident opposition by the Tamil National Alliance, the public, professionals and civil society activists over the suitability, durability and cost of the proposed houses, as well as the propriety of the procedure by which the contract was selected.

The second proposal -- which surfaced in May this year -- was to award 40,000 houses to China Railway Beijing Engineering Group Co Ltd and its country representative was Yapka Construction (Pvt) Ltd. A Cabinet paper submitted by Resettlement and Reconstruction Minister D M Swaminanthan said they were the same parties selected by the Disaster Management Ministry to erect 10,000 of these houses for landslide victims.

These are the two largest housing initiatives floated by the Ministry in the past three years. And both, multiple documents prove, are managed locally by Ravi Weththasinghe who was arrested in 2015 while attempting to leave the country. He is being tried for criminal fraud.

Mr Weththasinghe has had strong connections with previous United National Party regimes. In 1993, he acquired the Ceylon Transport Board’s Werahera, Kahagolla and Keppetipola workshops and formed two companies named Wesco and Kesco. The following year, with the defeat of the UNP, he fled the country leaving the incoming Government to settle millions of rupees in dues to workers.

In a letter to the Sunday Times in 2016, Mr Weththasinghe claimed that the logistics partner for the ArcelorMittal project was Kumarca Engineering and Management (Pvt) Ltd bearing PV number 109103, with its registered office at No 135, Tissara Building (3rd Floor), Dutugemunu Street, Kohuwela. He said he was the General Manager of that company.

But there is no longer an institution of that name or number registered with the Registrar of Companies (ROC). What is listed, instead, is Kumarca International Trading (Pvt) Ltd with the PV number 105759 and an incorporation date of May 21, 2015. Its registered address is No 24 1/1, Flower Road, Colombo 03.

Kumarca was floated shortly before the Resettlement Ministry went to the Cabinet with the ArcelorMittal proposal. But its website claims it was established in 2017 with a core business of trading in automobiles and consumer goods. And the address on its contact page is given as 352, High Level Road, Nawinna, Maharagama.

The China Railway project, the Cabinet paper said, is partnered locally by Yapka Construction (Pvt) Ltd. But, again, there is no such entity listed with the ROC. What is registered, instead, is Yapka Developers (Pvt) Ltd with PV number 129185. Its address is also 352, High Level Road, Nawinna, Maharagama. Its initial directors are Melissa Imashi Ramanayake and Susil Nawagamuwa.

Imashi Ramanayake’s LinkedIn profile says she is Executive Director at Kumarca International Trading, thereby drawing a clear nexus between that company and Yapka Developers, which was formed on January 23, 2018, just weeks before the Resettlement and Reconstruction Ministry’s fresh bid to the Cabinet.

It was not immediately clear why the Ministry, for a second time, has entertained a proposal -- the only one it has submitted this year -- from the same local agent.

Ms Ramanayake and Mr Nawagamuwa are also directors of Yapka Media Corp (registered to the Maharagama address), which was set up on Feb 20, 2018, “To carry out business of publishing Sinhala, English and Tamil newspapers and magazines; To carry on the business of broadcasting, telecasting, relaying, transmitting, distributing or running any video, audio, voice or other programmes or software (both proprietary and third party) over television, radio, internet, telecom or any other media.”

Along with two others, they are directors, too, of Yapka Media (Pvt) Ltd which was set up on February 14, 2018, “To carry out the business of publishing Sinhala, English and Tamil newspapers.” Susil Nawagamuwa, authoritative sources said, is Mr Weththasinghe’s long-time employee performing, among other duties, driving.

Meanwhile, the Chinese housing project hangs in the balance after India raised concern at the highest levels of the Sri Lankan Government about the manner in which the contract was awarded, without tender, to a company that has no history of building houses in the country.

It was also queried how a contractor that is unfamiliar with conditions in those areas, including soil and weather, could be approved without a comprehensive study.

The TNA, after initially supporting the Chinese project, also backtracked.

“The problem is that the Indian Government was objecting to these houses as they are from China,” Minister Swaminathan told the Sunday Times. “They have deprived the people from getting the houses. Now, the Prime Minister has called some quotations from Indian contractors. A few have come and are being processed.”

India has funded 50,000 houses in the country on a grant basis. Of these, 46,000 went to the North and East and 4,000 to the upcountry.

Another 10,000 houses have now been pledged to the hill country.

The Minister extolled the virtues of the China Railway houses saying they were “very good” -- 6,500 square feet in extent at Rs 1.3 million apiece, with solar power, toilets, pantry and tiled floors. “This is 100 percent financed by the Chinese at 1.28 percent interest, three years’ grace, and 15 years repayment,” he said.

“My Secretary, Mr Ponniah Suresh handled this,” he said. “We got a very good package and people need the houses.” He said he did not get involved and “kept myself aloof ”.

Mr Weththasinghe’s close friend and former brother-in-law Shane Dullewe is the Minister’s private secretary.

Meanwhile, a separate initiative to build 25,000 brick-and-mortar houses by a consortium of humanitarian agencies led by the UN Human Settlements Programme (UN-Habitat), the UN Office for Project Services (UNOPS), Habitat for Humanity Sri Lanka and the Sri Lanka Red Cross Society is proceeding.

“The problem is that the Indian Government was objecting to these houses as they are from China,” Minister Swaminathan told the Sunday Times. “They have deprived the people from getting the houses. Now, the Prime Minister has called some quotations from Indian contractors. A few have come and are being processed.”

These are the two largest housing initiatives floated by the Ministry in the past three years. And both, multiple documents prove, are managed locally by Ravi Weththasinghe who was arrested in 2015 while attempting to leave the country. He is being tried for criminal fraud.