25th November 2001

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Rice tenders shrouded in mystery

Government offers to the private sector to import a total of 60,000 tonnes of rice to overcome a shortage in the country have been shrouded in secrecy with the trade accusing authorities of giving licenses to 'favourities.'

"There was no formal announcement of this offer, as is the practice in the case in the past. We read reports in the newspapers about offers for 30,000 tonnes and then went to the Import Controller's office daily since last Tuesday in the hope of receiving application forms," said one importer, referring to one of the tenders.

Some importers made applications on Friday the day applications to import rice were doled out and were certain of approval. "We were waiting in the office as we were told our licenses were being prepared. But by noon, some other importers had separately approached the authorities including the Treasury and our pending licenses were cancelled," said one importer.

Four other importers, after meeting Treasury officials for a round of 'gentle' persuasion, were re-allocated this 4,000 tonnes at 1,000 tonnes a piece.

This was not the only drama surrounding rice imports last week. The trade also complained of irregularities in the CWE purchase of 30,000 tonnes of imported rice without calling for worldwide tenders.

Trade sources accused the CWE of purchasing two parcels of rice from India at much higher prices than world market rates. They said some Indian state-organisations had been picked from names provided by the Indian High Commission, without tenders being called for competitive bidding.

The Indian High Commission denied any wrongdoing in the process. "The CWE asked us for some names and we provided these names. The CWE also got some names of private suppliers from other sources. My understanding is that the tenders were given to parties at very competitive prices and there was no hanky- panky in the deal," said V. Ashok, the mission's trade counsellor.

CWE officials were not immediately available for contact despite The Sunday Times telephoning the residences of officials including their chairman who was out of Colombo. There was also confusion as to whether the total quantity imported was 80,000 or 60,000 tonnes. The Finance Ministry said it was 30,000 tonnes by the CWE and 30,000 tonnes by the private trade while the Import Control Department is said to have informed some trade sources that it was issuing licenses for a total of 50,000 tonnes.

The allegations came on the back of reports of an artificial shortage of rice from rice-growing areas and an appeal by the National Chamber of Commerce for a halt to imports. 

Under the private sector-led imports, each importer would be entitled to import a maximum 2,000 tonnes without duty if shipments arrive before December 10 and a 50 percent reduction on the normal 35 percent duty for arrivals between December 10 and 31.

The current shortage has been blamed on hoarding in rice growing areas to push prices up, a traditional practice ahead of any festive season. Red rice, normally selling at 22-28 rupees per kg, was now trading at 32-36 rupees per kg and in short supply.

However the National Chamber, in defence of farmers, appealed to the government to halt imports saying "there are ample stocks in the country and there is no need to import."

In a statement throwing in a different perspective to the crisis the chamber said that for local industry to thrive, the farmer must make a profit. "If they do not make a profit, the farmer would forever be poverty-stricken with loans he cannot pay and the stockists would be stuck with the stocks they have purchased from the entire area, unable to settle loans," the chamber said, blaming the current situation on rising costs in the supply chain process farmer-stockist-trader-transport costs.

It said imports would not only help foreign farmers but also the entire supply chain in supplying countries.

The CWE contract of 30,000 tonnes, trade sources alleged, was given in two parcels of 15,000 tonnes each to NAFED, an Indian state organization, at US$ 179 per tonne and Priyanka Overseas (Pvt) Ltd at US $ 165 per tonne with shipments due to arrive before December 10. 

Traders said world market prices for rice were down as much as $15 per tonne less than the CWE-agreed prices particularly from other Indian and Pakistan sources. They allege that in terms of these differences, the CWE would be coughing out an additional Rs 30 million for this high-priced rice.

They said the CWE tender inquiry went out only to a few selected Indian export trading houses through faxes without a tender notice the normal procedure even in emergency purchases being published in the newspapers.

The CWE has been mired in controversy in recent months over alleged shady deals and non-payment of dues to suppliers.

FR case over UNP office raid

The UNP General Secretary has petitioned the Supreme Court claiming the search of the UNP office in Bambalapitiya was a violation of his fundamental rights. 

General Secretary Senarath Kapukotuwa, said that acting on an anonymous tip-off that a vehicle had unloaded weapons at the Melbourne Avenue office, armed police had carried out a search operation. However, the police found no weapons of explosives.

The petitioner said that prior to the raid the Bambalapitiya OIC had warned him that if there was a parcel of explosives or weapons introduced even by outsiders, he would have to arrest all those in the office. Shibly Aziz PC and Ronald Perera appeared for the UNP.

UNP-EPDP clashes in Jaffna

With the election campaign hotting up, sporadic incidents of direct confrontations between supporters of the EPDP and the UNP are reported in the Jaffna peninsula . The supporters of both parties clashed at Stanley Road in the heart of Jaffna town on Wednesday. 

It is alleged a vehicle used by UNP supporters was forcibly snatched by EPDP supporters after they smashed it and attacked the UNPers.

Police rushed to the spot and took the smashed car and a pick-up van reported to be used by EPDP supporters.

FM returns after EU, UN visit

Foreign Minister Lakshman Kadirgamar returned to Colombo on Friday after an official trip to Brussels, New York and Paris. 

He addressed the Foreign Affairs Committee of the European Parliament and had discussions with senior officials of the European Union in Brussels during his visit.

Mr. Kadirgamar who was also in New York addressed two debates at the United Nations on the topics of 'Dialogue Among Civilizations' and the Plenary of the General Assembly.

A communiqué from the Ministry said that while in New York, the minister also had bilateral discussions with a number of Foreign Ministers and participated in three meetings on the fringe of the Assembly sessions.

On his return, Mr. Kadirgamar had discussions with senior officials of the French Government. 

Right of Reply

The Australian High Commission says:

We refer to your article "Australia Impedes Efforts to Combat Terrorism" (November 18), and an earlier report "Lanka in Commonwealth anti-terror team" (October 21). These reports present an incomplete picture of Australia's efforts and commitment to combat terrorism. 

The fight against international terrorism is the Australian Govern-ment's highest priority. Our unequivocal com-mitment to work with the international community has been demonstrated in many ways over the years and particularly since the September 11 terrorist attacks in the United States. 

Within the Commonwealth, Australia fully supports the Commonwealth Secretary-General's proposal for an Ad-Hoc Ministerial Committee on Terrorism. The Australian Prime Minister, John Howard, wrote to the Secretary-General of the Commonwealth at the outset of the proposal strongly supporting early practical Common-wealth action on terrorism and the establishment of a Ministerial level ad-hoc committee. To ensure that a Ministerial meeting was as productive and substantial as possible, Australia supported it being fully prepared for by earlier officials meetings, which have now occurred. Australian Foreign Minister Mr. Downer is likely to chair the Ministerial meeting. It is expected to make recommendations for consideration by Commonwealth leaders at CHOGM in Australia in March. 

Australia has in place a legal regime to deal with various types of international terrorism. Australia is party to nine of the eleven anti-terrorist Conventions and two anti-terrorism protocols. Australia signed the Terrorist Financing Convention on 15 October, and has commenced the process of ratification. Australia, as Vice-President, is taking a leading role, along with Sri Lanka, on the Ad-Hoc UN Working Group on Terrorism, and has been driving efforts to finalise negotiations on the Comprehensive Convention Against Terrorism. 

Australia is strengthening domestic legislation to build on existing anti-terrorist legislation, such as the Crimes (Foreign Incursions and Recruitment) Act 1978. To this end, the Government has established a high level committee to review Australia's counter-terrorism arrangements. The Prime Minister has already announced measures to freeze the financial assets of terrorists and their sponsors, including using the Banking (Foreign Exchange) regulations to block the financial transactions of terrorists, terrorist organisations and their sponsors. 

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