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FSP decries questionable Kantale sugar factory deal

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By Rathindra Kuruwita

The Frontline Socialist Party (FSP) and the Professionals’ National Front (PNF) yesterday condemned the proposal to hand over the Kantale Sugar Factory and 21,000 hectares of land that belongs to it to a Singapore-based company.

FSP Education Secretary, Pubudu Jayagoda said that the land would be leased for 30 years and that it was likely that the Cabinet would approve a questionable proposal submitted by Minister of Finance, Basil Rajapaksa, on 07 February 2022.

Jayagoda said that the factory had been established in 1960 with Czechoslovakian aid.

“At that time, Czechoslovakia was a socialist country. The factory was privatised in 1993, but even then, it was closed in 1999, it was producing 16,000 tons of sugar and 3.9 mil litres of alcohol.”

In 2015, the Yahapalanaya government tried to establish a company, MG Sugars Lanka Pvt. Ltd, with a Singapore-based company, SLI Developments Pte. Ltd, as a partner. The state was to hold 51% of the shares of the company.

A shareholders’ agreement was signed between MG Sugars, the Government of Sri Lanka and SLI Developments in 2016. SLI is connected to UK-based investors Mendel Gluck, Robert Salem and Moussa Salem.

“According to this agreement, the factory and nearby land were to be given to the company. Of the 21,000 hectares that belong to the factory, sugar cane was to be grown in 14,000 hectares and 7,000 were to be given to farmers. The water for the farming was to be taken from Kalu ganga, a tributary of the Mahaweli River,” Jayagoda said.

Gluck and the Salem brothers used K.P. Nagaraja, an Indian national to establish the business. There was a dispute between the investors and Nagaraja, and that resulted in a court case.

“In August 2019, August a Singaporean arbitration court said that there was a need to change the agreement. Subsequently, in July 2020, the Director Board was changed and a new agreement presented. On 09 August 2021, the Cabinet approved the new 30-year lease agreement. Earlier, on 05 August a MoU had been signed. However, this was different from the earlier agreement,” he said.

While under the previous agreement, the factory and nearby land was to be under the new company, the 2021 agreement had proposed to hand over the entire land to the company. Instead of taking water from Kalu Ganga, the water was to be taken from the Kantale tank.

“Although the government was to own 51% of the shares, Moussa Salem was to be the Chairman of MG Sugars. Gluck was to be the CEO. Thus, SLI would run all the operations. This will also mean that farmers in the area will face water shortages because Kantale Tank is an important source of water,” the FSP Education Secretary said.

The project to revive the Kanthale Factory is expected to cost USD 300 million, but SLI will only invest USD 70 million. However, according to the agreement 85% of the profits in the first 10 years will go to SLI. 75% of the profits in the second 10 years will go to SLI.

“The government will get 51% of the profits only in the third decade. Sri Lanka will make most of the investments but will make a pittance. This is a serious issue,” he said.

Meanwhile, Eng. Kapila Renuka Perera of the PNF said that this agreement would only lead to a monopoly, which will be disastrous for Sri Lankans. He added that given that all lands will be given to MG Sugars, Sri Lankan farmers will not be benefitted.

“The agreement also allows the company to import unpurified sugar, purify it here and re-export. This will be done with virtually no oversight. Previous governments too have come into agreements that lead to monopolies, like wheat, and these only had negative impacts on us. This will also have similar results. A few people will benefit at the country’s expense,” he said.



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Pakistan naval trio arrives at Colombo Port

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In a display of naval tradition, the Sri Lanka Navy formally welcomed the Pakistan Navy Ships ‘PNS Taimur’ and ‘PNS Aslat’, alongside the submarine ‘PNS/M Hangor’, arrived at the Port of Colombo on 01 Jun 26.

The Pakistan naval units made port in Sri Lanka for a goodwill visit as well as replenishment.

The visiting naval assets are commanded by a lineup of naval officers, with Captain Niamat Saeed Khan (‘PNS Taimur’), Captain Nadir Mateen Afridi (‘PNS Aslat’), and Captain Uzair Farooq (‘PNS/M Hangor’).

During their stay in Sri Lanka, the crew members of the visiting ships and submarine are scheduled to tour several key locations across the country.

Concluding the visit, the Pakistan naval units will engage in a Passage Exercise (PASSEX) with the Sri Lanka Navy off the west coast.

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IMF turning a blind eye to NPP corruption: Opp.

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Patali / G. L. Peiris

The People’s United Opposition yesterday (01) alleged that the International Monetary Fund (IMF) had turned a blind eye to serious corruption allegations against the NPP government and was going ahead with the USD 2.9 bn loan in terms of the Extended Fund Facility (EFF) programme, finalised in 2023.

Addressing the regular weekly media briefing at the Flower Road Office of former President Ranil Wickremesinghe, former Ministers Prof. G. L. Peiris and Patali Champika Ranawaka questioned the failure on the part of the IMF to act in spite of the NPP government engaging in open corrupt practices, contrary to the terms and conditions of the agreement/understanding with the lending agency.

The media was told that the IMF couldn’t absolve itself of the responsibility for the actions of the government, especially because Sri Lanka, experiencing severe economic difficulties, was receiving loans from IMF at over 8%. Ex-parliamentarian Ranawaka pointed out that what Sri Lanka received from the IMF was not JAICA-type soft loans and the country was further burdened.

Prof. Peiris and Ranawaka alleged that the IMF appeared to have chosen not to take up the serious and growing accusations, particularly over coal and fuel scams that caused massive losses. They claimed the government had taken decisions at the expense of the country but for the benefit of certain businessmen close to them.

Both Prof. Peiris and Ranawaka explained the circumstances under which certain persons and companies received privileged status to import very costly vehicles and even helicopters and aircraft as the government

wasted precious foreign reserves for the benefit of friends. Ranawaka named two companies that benefited from government actions while alleging that those engaged in lucrative coal and fuel business made a killing.

They pointed out that the IMF released the latest USD 695 mn amidst stepped up serious allegations against the government. (SF)

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Shavendra tells Beijing meet Sri Lanka should not become an arena for geopolitical rivalry among major powers

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Shavendra Silva

Former Commander of Sri Lanka Army with possibly the best battlefield record, having recovered the most amount of enemy occupied territory by troops he led from the front in the Vanni theatre of operations (2007-2009), General Shavendra Silva recently discussed growing challenges faced by smaller countries, like Sri Lanka, in what he called the evolving global environment.

Stressing that responsibilities must be shared across all states, the former Commander of the Sri Lanka Army told the 5th edition of the Wanshou Dialogue on Global Security in Beijing: “Major powers bear a special responsibility to exercise strategic restraint, avoid coercive practices, uphold international law, and contribute toward global stability rather than fragmentation.

Emerging and middle powers have an increasingly important role as bridge builders promoting dialogue, cooperation, and institutional reform.

For countries such as Sri Lanka, the path forward lies in principled and balanced diplomacy.

This requires maintaining constructive relations with all nations while safeguarding sovereignty, strategic independence, and national interests.

Sri Lanka has consistently maintained that its territory should not become an arena for geopolitical rivalry or military confrontation among larger powers.

Instead, our focus remains on strengthening national resilience through economic development, institutional stability, maritime awareness, modern defence capabilities, and agile diplomacy.

Credible domestic institutions, accountable governance, and national cohesion ultimately strengthen sovereignty while reducing opportunities for external interference.”

Referring to his service as Ambassador and Deputy Permanent Representative of Sri Lanka to the UN in New York, General Silva said that his engagements at the UN and other international forums reinforced the importance of defending national interests while remaining committed to reconciliation, development, and peaceful coexistence.

The celebrated battlefield commander discussed the transformation of global security, the future direction of the international order and the responsibilities of states in this transitional era. Silva said: “Today, security threats extend far beyond conventional warfare.

Cyber threats, terrorism, disinformation, economic coercion, artificial intelligence, and the weaponisation of technology increasingly influence global stability. At the same time, climate change, pandemics, food insecurity, and economic disruptions have demonstrated how closely national security and human security are now interconnected.

For Sri Lanka, located at the centre of the Indian Ocean along one of the world’s most important maritime trade routes, these developments carry direct strategic significance. Sri Lanka’s own experience offers valuable lessons.

The defeat of the LTTE, in 2009 demonstrated the importance of decisive state action against terrorism, while also revealing how modern conflicts become internationalised through financing networks, propaganda, illicit arms flows, and external geopolitical pressures.

The post-conflict period further reinforced the importance of reconciliation, economic recovery, institutional rebuilding, and long-term national resilience.

Smaller states increasingly face pressures arising from great-power rivalry, economic dependency, and strategic competition.

Sri Lanka has, therefore, consistently sought to maintain strategic balance while safeguarding sovereignty and constructive engagement with all partners.

China has remained an important development and economic partner for Sri Lanka over many decades. The relationship, strengthened through the 1952 Rubber-Rice Pact, expanded significantly in the post-war period through cooperation in infrastructure, connectivity, logistics, energy, and economic recovery. Projects associated with the Belt and Road Initiative have contributed to Sri Lanka’s development, regional connectivity, and post-crisis resilience. China also extended support during the COVID-19 pandemic and Sri Lanka’s recent economic stabilisation efforts.

The future international order must be shaped not by confrontation or exclusive blocs, but through pragmatic cooperation, institutional reform, and balanced multilateral engagement.

International institutions, particularly the United Nations system, must evolve to better reflect contemporary geopolitical realities and the growing voice of the Global South.

Without greater inclusivity and legitimacy, multilateral institutions risk losing effectiveness in addressing increasingly complex global challenges.

Equally important is preserving a rules based maritime order grounded in international law, particularly the principles of the United Nations Convention on the Law of the Sea.

The international community must also establish clearer norms governing emerging technologies, cyber operations, artificial intelligence, autonomous weapons systems, and outer space security.

Sri Lanka’s recent economic stabilisation efforts further demonstrated that internal resilience is essential for maintaining strategic autonomy and an independent foreign policy.

It is also an opportunity to build a more inclusive, balanced, and resilient international order capable of responding to the realities of the 21st century.

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