Basil stops donor-funded new buildings in north, east

Decision raises questions over India’s 50,000 houses project

Construction of all new buildings in the North and East under donor-funded loan or grant projects coming under the Ministry of Economic Development has been stopped from December 9. Economic Development Minister Basil Rajapaksa, who oversees the larger volume of development projects in the once war-torn provinces, has directed that priority should be given to renovation and reconstruction of existing buildings. The only exceptions, he has said, will be the construction of storage/warehouse facilities for storing paddy and other crops, for which purpose concurrence will be granted “on a case by case basis” by the Secretary to the Ministry of Economic Development.

Dr. P.B. Jayasundera, who is Secretary to this Ministry, is also the Secretary to the Ministry of Finance, a subject that comes under President Mahinda Rajapaksa who holds the finance portfolio.
Nihal Somaweera, Additional Secretary (Regional Development) in the Ministry of Economic Development, who has conveyed Mr. Rajapaksa’s directive to all line ministries and government officials in the two provinces, has given no reason for the move. The local offices of the World Bank, Asian Development Bank and the Japan International Co-operation Agency, which have offered substantial funding for building projects as part of assistance for infrastructure development in the North and East, have also been informed. So have a number of other donor organisations.
It is not immediately clear whether the construction of 50,000 houses by the Government of India, -- to be carried out on a financial grant from New Delhi -- will be affected by this decision.

Already, India has been informed of the allotment of land for the construction of a pilot project of 1,000 houses in Jaffna. The Government has also identified the beneficiaries of these houses. A similar pilot project for building 1,000 houses in the Kilinochchi district is now being processed by the Government.
The Indian housing project does not come under the purview of the Ministry of Economic Development.
However, confusion over the issue has arisen as a result of the Ministry’s directive being issued simultaneously to the Presidential Task Force for Resettlement, Development and Security in the Northern Province, which handles the subject.

Basil Rajapaksa has said that if there was a need for the construction of new buildings other than storage facilities, “under exceptional circumstances, the prior concurrence” of the Secretary to the Ministry of Economic Development should be sought by the relevant authority. He has also said that all “sub project components” should be approved by the relevant District Coordinating Committees (DCCs) at their regular meetings, prior to implementation.

The directive has been copied to the Directors General of the Department of External Resources, Department of National Budget and the Department of Foreign Aid/Budget Monitoring – the three State agencies that deal with foreign loans and grants for various projects. Key Government ministries, agencies, departments, officials in Provincial Councils and Secretaries to Provincial Council Ministries dealing with development projects were among those informed of this new decision.

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