China’s leading aircraft manufacturing company, which failed to secure land for outright purchase at Galle Face for a multifunctional complex, will be awarded a multi-million dollar contract in the technology sector, a Cabinet Minister said yesterday.
Higher Education Minister S.B. Dissanayake told the Sunday Times China Aviation Technology Import-Export Corporation (CATIC) would construct the Institute of Technology complex at Homagama at a cost of US 89.55 million (Rs 9.9 billion).
He said the Chinese government would give a loan for this project and an agreement with CATIC for the construction work would be signed shortly. CATIC is already engaged in a legal wrangle with the government.
This came after it paid an advance of US $ 54.4 million (Rs 5.9 billion) for the purchase of more than seven acres of land overlooking the Galle Face Green.
A balance payment of Rs. 86 million (Rs. 9.4 billion) was due when the government took a policy decision that no land would be sold outright but would be given only on lease for periods extending up to 99 years.
CATIC is now refusing to accept the advance and is insisting on the purchase of alternate land.
Mr. Dissanayake said the technology complex came within the purview of his ministry.
CATIC is also engaged in a US $ 700 million (Rs. 77 billion) project in the road construction sector through its holding company AVIC International. This is under Economic Development Minister Basil Rajapaksa’s Uthuru Vasanthaya project.
An opposition MP meanwhile claimed that the government might be compelled to forego the prime land at Galle Face if it failed to return the advance payment made by CATIC.
The UNP’s Kurunegala District parliamentarian Dayasiri Jayasekera said there was a dispute as to which state agency received the advance payment from CATIC.
He said the government should disclose whether the money was deposited with the general account in the Treasury.
He said the government had disclosed that in the case of the Shangri La Hotel construction project at the Galle Face, payment of US$ 125 million (Rs. 13.7 billion) had been deposited in Treasury General Account Number 6000. However, in the case of CATIC, no such information was forthcoming.