Situation Report

25th June 2000

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Military procurements and corruption

For a second time during the so called "Eelam War Three", the People's Alliance Government has embarked on a multi billion rupee military procurement deal.

The first was in 1995. Soon after being voted to power during Parliamentary elections in 1995, the Government halted military procurements, suspended plans for military offensives and embarked on peace talks with the Liberation Tigers of Tamil Eelam (LTTE). After almost three months, the talks broke down and the LTTE attacked the dockyard in Trincomalee, headquarters of the Eastern Naval Area. Both the Government and the LTTE accused each other of reneging on the talks.

Angered by the developments, the Government ordered the Commanders of the Army, Navy and Air Force to crack down hard on the LTTE They were told to "militarily weaken" the LTTE within six months. The Commanders explained military procurements were imperative since they had been put on hold by the previous regime. This was until the party that came to power during the parliamentary elections took decisions.

Acquiring them, the Commanders pointed out, was time consuming in view of procedural formalities. They included call for tenders, the evaluation by expert committees of the suitability of items to be procured and resort to other laid down procedures.

The mandatory six months has gone by eleven times over. The "Eelam War Three" is over five years old. The period has seen the LTTE grow in strength from a guerrilla group to one that acquired conventional capability. It also acquired sophisticated stand off weaponry.

Yet, when the Government clamped down a censorship on June 5, 1998, reportage of military procurements were specifically left out. Government officials responsible for the censorship explained the media was free to report on any military procurements and alleged corrupt activity relating to them. They said curbs were not placed on reportage of these matters since the Government wanted to demonstrate its policy of transparency even in the field of military procurements.

It is in this backdrop that the Government embarked on a US $ 800 million procurement drive, easily the biggest in the 17 year long separatist war. This figure, some Government sources say, is expected to increase. In order to raise funds locally for this major effort, price increases were effected in some consumer items.

If this came as a blow to low and middle income groups, other price increases like in cooking gas and the depreciation of the rupee, have had a crippling effect. Have they been compelled to pay for the sins of those who made millions and got away?

In making preparations for the latest procurement drive, the Government did make an effort to deal directly with the suppliers and believed that would eliminate the middlemen. 

Formalities for the procurement process got under way on April 12, 2000 - nearly two weeks before the military debacle at Elephant Pass which forced troops to withdraw. This is when Major General A.K. Sooriyabandara, Army's Master General Ordnance, signed letters on behalf of Secretary, Ministry of Defence. These letters were sent to suppliers mostly through their respective diplomatic missions. This is what the letter said:

clear that "local agents will not be permitted to represent principals." 

The explanation given by the Ministry of Defence for asking suppliers to quote for one year and when needs arose was with "a view to avoid the delays experienced at present by calling for tenders.." The MOD letter adds "Once the prices are fixed the Armed Forces will be placing indents directly with the principal for these items avoiding the need to tender."

How do delays arise when tenders are called for? Is it not due to bureaucratic inaction? If so, should not those who are responsible ensure such delays do not occur in a high priority area like defence? The question becomes relevant because the Ministry of Defence is not the only Government institution that resorts to tender procedures. So have other Government Ministries, Departments, Corporations and statutory bodies. If all of them decide to do away with tender procedures "to avoid delays," the system of tenders which have remained for over 51 years since independence may have to be done away with.

Responding to the government's invitation to suppliers, a top level delegation from the Czech Republic's Embassy in New Delhi arrived in Colombo for talks with the government. Defence equipment in the Czech Republic are manufactured by state owned industries. There is no diplomatic mission in Colombo for the Czech Republic. Hence the delegation from New Delhi.

The Czech team, called on government leaders and held talks with defense officials handling procurement in May, this year. The successful conclusion of deals prompted the 

It is after the deals were concluded that other events began to overtake the issue.

A Sri Lanka Army delegation was to visit the Czech Republic to examine the items that are being procured under the deals concluded. The Czech authorities were awaiting their arrival.

Instead a two-member Army delegation comprising a Lieutenant Colonel and a Major were visiting the Slovak Republic and Hungary. They were inspecting the same equipment for which deals had been concluded with the Czech Republic.

Even before the team went to Slovakia, the authorities had donated Censored Multi Barrel Rocket-Launchers to Sri Lanka. The team is learnt to have examined the possibility of purchasing rockets from Slovakia for these MBRLs as well as for those donated by the Czech Republic.

After ending their visit to Slovakia and Hungary, the Army delegation had wanted to travel to the Czech Republic.

With the country placed on a "war footing", Sri Lankans have been called upon to make sacrifices for the nation. Even if they are not told of what is going on in the north, they have been compelled to endear hardships. Now, with a total censorship blurring procurements, they are blissfully unaware that they will be forced to make more sacrifices.

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