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Suspension of Bimputh Finance and Rs 69 mn loss for HDFC: Ex-COPE Chief admits lapses

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Former Chairman of Committee on Public Enterprises (COPE) Prof. Charitha Herath

By Shamindra Ferdinando

Former Chairman of Committee on Public Enterprises (COPE) Prof. Charitha Herath yesterday (13) said that undue delay on the part of a particular parliamentary watchdog committee to call certain state enterprises should be inquired into against the backdrop of some hidden facts and perhaps political interference.

In the case of HDFC Bank, massive loans had been granted to some politicians though the Auditor General’s Department and COPE failed to ascertain the situation, the rebel SLPP lawmaker claimed. The MP found fault with what he called the COPE review committee.

Prof. Herath said so when The Island sought his explanation as to how COPE, during his leadership, conveniently failed to summon HDFC Bank under investigation for suffering Rs 69mn loss by granting a special interest rate to a fixed deposit of the CEB and releasing a loan amounting to Rs 350 mn to Bimputh Finance PLC (BPF) on July 18, 2018.

During COPE proceedings in respect of HDFC Bank late last month, it was revealed that it hadn’t been summoned before the watchdog committee for a period of nine years. According to Director Legislative Services, the bank last appeared before COPE on Nov 04, 2014 in the run-up to the presidential election won by Maithripala Sirisena.

JVP MP Sunil Handunnetti served as Chairman COPE during the Yahapalana administration. After Gotabaya Rajapaksa was elected President in Nov 2019, Prof. Herath succeeded Handunnetti. Following Gotabaya Rajapaksa’s ouster in July 2022, Parliament elected Prof. Ranjith Bandara as the new COPE Chief. Former MP Handunnetti didn’t answer his phone.

Responding to another query, Prof. Herath said there are 214 corporations and nearly 20 other institutions subjected to scrutiny by COPE though the parliamentary watchdog missed HDFC Bank. The MP claimed that there were no other problems in HDFC bank other than the issues at hand.

MP Herath said that now latest statistics were available and therefore COPE could go into HDFC Bank. “I believe special measures should be adopted to investigate hidden cases in some state enterprises. We should implement a special review process to identify cases which required special attention,” Prof. Herath said.

Stalled investigations have revealed that disciplinary action hadn’t been taken in respect of an employee of the HDFC bank in spite of him being found guilty of playing the role of a clandestine agent in the deal with CEB.

COPE, under the leadership of Prof. Ranjith Bandara, has recommended to the Finance Ministry to inquire into the issue at hand and take tangible action against the HDFC employee within a month, according to a statement issued by Janakantha Silva, Director Legislative Services / Director Communication (Acting).

Against the backdrop of COPE declaration that the HDFC Bank faced problem in recovering Rs. 350 mn loan given to BPF, the Central Bank has announced that BPF had been prohibited from operating with effect from Sept. 01, 2023. Prof. Herath, in his response to The Island query, referred to this particular case when he mentioned some politicians being granted massive loans.

Prof. Bandara is on record as having said that the BPF matter would be referred to the Commission to Investigate Allegations of Bribery or Corruption (CIABOC).

According to a Central Bank statement dated Oct 27, 2023, the troubled finance company had been stopped from operating in terms of Section 37 of the Finance Business Act No 42 of 2011. The Director, Resolution and Enforcement Department has assured depositors of BPF that all depositors would be compensated in line with the provisions of the Sri Lanka Deposit Insurance and Liquidity Support Scheme (SLDILSS) Regulation No 02 of 2021.



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34 new projects under “Clean Sri Lanka” programme this year

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Under the guidance of President Anura Kumara Disanayake, the “Clean Sri Lanka” programme,  implemented as a key government initiative is set to launch 34 new projects this year, and work on many of these projects is scheduled to commence by the end of this April.

In line with this, a one-day workshop was held on Thursday (10) at the “Clean Sri Lanka” Secretariat located in the Lotus Building at the Temple Trees, under the leadership of Secretary to the President Dr. Nandika Sanath Kumanayake. The workshop provided technical guidance on preparing project proposals in accordance with the formats required by the Department of National Planning for submission and approval.

The “Clean Sri Lanka” programme aims to foster social, environmental and ethical transformation across the country, with the active participation of all stakeholders. A sum of Rs. 5 billion has been allocated from this year’s national budget for its implementation.

Once the Department of National Planning grants approval for the proposed projects, detailed action plans will be developed in line with prescribed formats. It was agreed that projects deemed ready for implementation will commence before the end of April.

During the workshop, Secretary to the President outlined the government’s expectations and the intended outcomes of the “Clean Sri Lanka” programme.

Senior officials representing the Ministry of Public Administration, Provincial Councils and Local Government, Ministry of Foreign Affairs, Foreign Employment and Tourism, Ministry of Health and Mass Media, Ministry of Education, Higher Education and Vocational Education, Ministry of Transport, Highways, Ports and Civil Aviation, Ministry of Public Security and Parliamentary Affairs, Ministry of Agriculture, Livestock, Lands and Irrigation, Ministry of Digital Economy, Ministry of Urban Development, Construction and Housing, Ministry of Environment, Ministry of Industries and Entrepreneurship Development, Sri Lanka Police, and the Western Provincial Council were in attendance.

Also present were Engineer S.P.C. Sugeeshwara, Additional Secretary to the President (Clean Sri Lanka Programme) and G.M.R.D. Aponsu, Senior Additional Secretary to the President (Finance and Economic Affairs), along with other senior officials.

[PMD]

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Financial assistance of USD 01 Million for the Disaster-Affected People of Myanmar

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The Government of Sri Lanka has extended financial assistance amounting to USD 01 Million to provide relief to the people of Myanmar affected by the recent earthquake.

The relevant cheque was officially handed over by the Secretary to the President, Dr. Nandika Sanath Kumanayake, to the Ambassador of Myanmar to Sri Lanka,  Marlar Than Htaik.on Thursday (10) at the Presidential Secretariat.

Despite the prevailing economic challenges in Sri Lanka, the Ambassador of Myanmar expressed her deep appreciation to President Anura Kumara Disanayake and the Government of Sri Lanka for this gesture of solidarity and support towards the disaster-stricken people of Myanmar.

Furthermore, the Ambassador extended her gratitude for Sri Lanka’s decision to deploy relief teams and medical personnel during this difficult time. She also noted that such acts of compassion further strengthen the longstanding religious and cultural friendship between Sri Lanka and Myanmar.

The Ambassador also briefed the Secretary to the President on the current situation in Myanmar following the earthquake.

Senior Additional Secretary to the President,  Roshan Gamage, along with officials from the Embassy of Myanmar,  Winh Wint Khaus Tun and Ms. Lei Yi Win, were also present at this occasion.

[PMD]

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Indo-Lanka MoUs unlikely to be tabled in Parliament any time soon

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Ali Sabry

…of seven SOCs only one constituted so far

Sri Lanka’s controversial MoU on Defence Cooperation with India was unlikely to be taken up any time soon in Parliament in spite of the House Sectoral Oversight Committee (SOC) on Governance, Justice and Civil Protection that has been assigned defence, authoritative sources told The Island.

Of the seven SOCs only one was activated with the recent election of Dr. Najith Indika, MP, as the Chairman of the Sectoral Oversight Committee on Governance, Justice, and Civil Protection of the Tenth Parliament.

The inaugural meeting of the current parliament was held on 21 Nov., 2024.

Sources said that the parliament had met for the last time yesterday (10) before the Sinhala and Tamil New Year holiday. It is scheduled to meet again on May 8.

The UNDP that has financially backed the establishment of the SOC system to help strengthen the role of the parliament recently reached a consensus with the government to reduce the number of SCOCs from 17 to seven. The Island, in writing, asked for the UNDP’s reaction to the operation of SOCs but had not received a response at the time this edition went to press.

The SOCs have the power to examine any Bill, except the Bills defined in Article 152 of the Constitution, Treaty, Reports including the Annual and Performance Reports relating to the institutions coming under its purview or any other matter referred to the Committee by Parliament or any Committee or a Minister relating to the subjects and functions within their jurisdiction.

Sources said that out of the seven SOCs only one had been activated during the past five months though the government and the Opposition agreed to share the leadership of them.

Accordingly, it was agreed that the government would appoint chairpersons to four SOCs –– Economic Development and International Relations, Health, Media and Women’s Empowerment, Science, Technology and Digital Transformation and Governance, Justice and Civil Protection .

It was also agreed that the Opposition would appoint chairpersons to the SOCs on Infrastructure and Strategic Development, Education, Manpower and Human Capital, and Environment, Agriculture and Resource Sustainability to the Opposition.

India and Sri Lanka on April 5 signed six MoUs on HVDC interconnection for import/export of power, cooperation in the field of sharing successful digital solutions implemented at population scale for digital transformation, defence cooperation, multi sectoral grant assistance for Eastern province, health and medicine and pharmacopoeia cooperation. In addition to them, India, Sri Lanka and UAE signed a tripartite MoU cooperation in development of Trincomalee as an energy hub.

The Island  asked Ali Sabry, PC, who served as foreign minister during Ranil Wickremesinghe’s tenure as the President (July 2022 to Sept 2024) whether the seven MoUs had been discussed during that period. We also asked him whether those MoUs should have been discussed at SOCs before finalisation.

Sabry said: “Most of the MOU to my knowledge were discussed except the one on Defence Cooperation, which I am unaware of. General procedure is the relevant line ministry prepares the initial draft and gets the input from the Foreign Ministry and goes for stakeholder consultation of all ministries and agencies involved. Then the President’s Office grants its sanction and with the approval of the AG, it goes before the cabinet of ministers. With Cabinet approval, the government could sign the MOU.”

Sabry said that he was of the opinion that once the government signed a particular MoU, it should be placed before the parliament. “MOU’s are generally not legally binding and only signify the desire to work together. If the signed MoUs were to be implemented, then they have to be followed by agreements or laws.”

He emphasised the pivotal importance of transparency in the whole process. The ex-minister said: “I think transparency is crucial in these matters. Concealment leads to speculation and assumption of the worst. The MOUs should be tabled in Parliament for public information. Discussion at the relevant SOCs would have been helpful. There are growing fears fueled by lack of information in the public domain. This is a private comment, not to be attributed to me.

Asked whether MoUs, particularly the ones on defence and energy had to be approved by the Attorney General, the former minister said that the AG has to advise the MoUs compatibility with the Constitution. “But Article 157 of the Constitution does not apply; the 2/3 majority stipulated there envisages only investment treaties.” Foreign Minister Vijitha Herath assured Parliament on April 8 that the AG had cleared all seven MoUs and none of them were inimical to the country.

By Shamindra Ferdinando

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