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Lanka Logistics & Procurement of Arms



Lanka Logistics never followed the NPA Guidelines due to ambiguities and inconsistencies in the guidelines, according to the facts provided in the open letter written to the President on NPA Guidelines by the writer (Dr. de Silva) about the 2nd CM against General Sarath Fonseka.

by Gunadeera Rajakaruna, writing from Singapore

(November 10, Singapore, Sri Lanka Guardian) Procurement specialist has defined the meaning of the word Procurement as:

“To procure any goods, works or services using the best (contract) conditions available to procure a cost effective product or a project”.

But, unfortunately in Sri Lanka, most people who engaged in procuring works, goods & services has very little knowledge about the above definition, and look for various means of making a good commission for themselves, even the product doesn’t meet the specifications, or the necessity of the project.

Since 1983 various governments through middlemen purchased Arms and Ammunition and other heavy equipments necessary to fight the LTTE Terror activities. But, LTTE terror activities got accelerated as most of these agents started paying commissions to the government Ministers as well as to the Defence service personals that helped them to obtain these contracts.

Some of these helpers became so rich and there was a competition among the defence high rankers to get involved in Arms procurements. Some business people earn their billions by helping the government to buy second quality Arms and Ammunition and most Ministers and Secretaries responsible for the defence service engaged in this day light robbery and the country was virtually taken over by the LTTE.

In 2005 November, Mahinda Rajapakse was sworn in as the President of Sri Lanka, and he appointed his brother Gotabaya Rajapakse as the Defence Secretary. Gotabaya Rajapakse as soon as he assumed duties as the Defence Secretary declared that he will stop all the corruption in procurement of Arms and ammunitions and other heavy equipments for the Defence Services by eliminating the third party participation. We all rejoice this announcement thinking that Rajapakse brothers will annihilate the corruption in the country and doing so they will annihilate the corruption in procurering of arms and ammunition by the defence services, corrupt to the core high ranking officers. This announcement was supported by many and every individual in Sri Lanka and in overseas countries engaged in helping the eradication of the LTTE war was happy to see a man related to the President of the country will eradicate the corruption in the procurement of Arms.

What is Lanka Logistics

Is the Lanka Logistic- a company for purchase of Arms registered with the Registrar of Companies Sri Lanka under the Laws of Sri Lanka ?

In my opinion this company is a registered government company according to the papers I saw at the Registrar of Companies. Details of the establishment of Lanka Logistics is as follows:

In early part of 2006, the Secretary of Defence Mr. Gotabaya Rajapakse, brother of President Mahinda Rajapakse wanted to establish a company to purchase all the Arms, ammunitions and other heavy equipments for the Defence Forces. This he did then with the intension of cutting the middle men and to save money for the Government. The company was registered and the following people and entities were appointed as shareholders of the Lanka Logistics with the total number of 10shares.

Chairman: Mr Gotabaya Rajapakse, Secretary of the Ministry of Defence with 5 shares (by name)

Directors: Dr. P.B.Jayasundera, Secretary to the Treasury with 1 share, (by name)

Mr. Mohan Peiris, PC, AG, then the Legal Adviser to the President and the Secretary Ministry of Defence with I share (by name)

Army Commander with I share, (by position)

Air Force Commander with 1 share, (by position) and

Navy Commander with I share. (by position)

CEO/ Managing Director: Mr. Jayantha Wickramasinghe

(Supposed to be a class mate of Gotabaya Rajapakse at Ananda College , Colombo and a relation /very good friend of Rajapakse family - he never had any formal knowledge in procurement or the legal implications in procuring Arms and Ammunition etc, other than the friend ship with Gotabaya Rajapakse).


Cost of Purchases

Lanka Logistic purchased (as per Treasury and MOD figures) close upon US $ 1 billion worth of heavy and other equipments, arms and ammunition from various countries.

Lanka Logistic purchased the bulk of these Arms, Equipments, Fighter planes, and warships, multi barrel guns from various countries, and the main suppliers were Russia and the satellite countries like Ukraine , China , Gt. Britain , Israel , and Pakistan . Some other countries supplied the Arms and ammunition through third party countries such as Pakistan and Israel .

In addition to these purchases by Lanka Logistics Army, Air Force and the Navy purchased the urgent use of day to day materials according to the MOD/Treasury allocations. In certain instances, the services heads were allowed to purchase urgent materials for the front line with the approval of the line Ministry Secretary, as the money allocation was controlled by the MOD.

Use of NPA Guidelines

Lanka Logistics never followed the NPA Guidelines due to ambiguities and inconsistencies in the guidelines, according to the facts provided in the open letter written to the President on NPA Guidelines by the writer (Dr. de Silva) about the 2nd CM against General Sarath Fonseka. He has stated that the Lanka Logistic never used the NPA Guidelines as it creates ambiguity and inconsistencies and other restriction on time frame necessary for the said procurements to be purchased in time. This was Defence Secretary Gotabaya Rajapaksa’s orders, and none of the Directors questioned him. Even the present AG who was a share holder and the Legal Adviser to Defence Secretary never advised Mr. Gotabaya Rajapaksa what he was doing is illegal and he can be prosecuted as the Chairman of Lanka Logistics along with other Directors and the CEO/MD.

" The sections under which General Fonseka was charged if applied to the Chairman of the Lanka Logistic, and Gotabaya Rajapakse and Jayantha Wickramasinghe got most of the Invoices for Air Crafts, Arms and Ammunitions from the Ambassadors of the countries we purchased those arms. It is not a secret that the Ambassador to Russia and China are very close relations of the Rajapakse family."

If we assumed that the Lanka Logistic was responsible for procuring at least US $ 900 million worth of equipments, arms, ammunition etc, then the Directors of the Lanka Logistics may be responsible for financial ireregulates or financial mismanagement, and using relations to obtain inflated invoices for equipments and will be liable for prosecution, as in the case of Hicorp, as Lanka Logistic never used the NPA Guidelines for any procurement small or big. If the Guidelines are legal instruments and then they violated all the sections of the NPA Guidelines and they never tested the quality and the validity of any equipments as there was no TEC ot TB..

The sections under which General Fonseka was charged if applied to the Chairman of the Lanka Logistic, and Gotabaya Rajapakse and Jayantha Wickramasinghe got most of the Invoices for Air Crafts, Arms and Ammunitions from the Ambassadors of the countries we purchased those arms. It is not a secret that the Ambassador to Russia and China are very close relations of the Rajapakse family. If so what about the section 1.4.3 related to these procurements. If it is good for the Defence Secretary Gotabaya Rajapaksa, the Chief Accounting Officer of the Ministry to do so then it is good for the former Army Commander General Sarath Fonseka to violate the NPA guidelines to a certain extent. But even without violating the NPA Guidelines the CM put him behind bars. What punishment is going to be given to Gotabaya Rajapakse, Jayantha Wickramasinghe, P.B.Jayasundera T/S and Mohan Peiris PC, AG, by the civil courts when they get charged?

Somewhere in 2007, Sunday Leader accused the Secretary of Defence Gotabaya Rajapakse for violating the NPA Guidelines while purchasing the 4/MIG 27 and the other 2/ MIG 24 and training Fighter jets. I think Defence Secretary Gotabaya Rajapakse took the Sunday Leader to courts for deformation of character for publishing false information regarding procurement of the MIG Fighter Jets. The information in that article was correct to a certain extent, and if I can remember correct, in that same year after the Sunday Leader article was published Dr. de Silva (who wrote the open letter to President) wrote a very lengthy article and discussed the ambiguities and inconsistencies of the NPA Guidelines and argued that what Defence Secretary Gotabaya Rajapaksa did was correct due to time restrictions for such procurements. After this article appeared in the Sri Lankan papers, the NPA was closed down by the President, but allowed the used of the Guidelines.

If the Sunday Leader Editor has published the correct information, then it may not construed a deformation of character as she has stated the truth. (I allow the learnered judges to decide on that). If so why, Defence Secretary press charges against the former Army Commander for the correct action taken by the TEC appointed by the Defence Secretary from recommending only one company.

Dr. de Silva argued to use the NPA Guidelines to procure all this million dollars worth of arms & equipments in a very short period by the Lanka Logistics was impossible due to restrictions of time limits in the NPA Guidelines.

If the NPA Guidelines were used and the time limits imposed on the procurement of all Arms & equipment worth over Rs. 3 billion may have affected all these procurements then the LTTE war is still a going concern. Then how the Chairman and the other Directors, overcame this limitation, and by doing this didn’t they violated the NPA Guidelines. If they violated the guidelines then they have committed a crime as established by the 2nd CM, under the common Law practice in Sri Lanka . The Chairman of the Lanka Logistics, Mr. Gotabaya Rajapakse Defence Secretary and the other two directors, the Treasury Secretary Dr.P.B. Jayasundera and the Attorney General Mr. Mohan Peiris PC with the other three Director from the three entities (Army, Navy and Air Force) along with the CEO/.MD Mr. Jayantha Wickramasinghe may be guilty of financial misappropriation and cheating the government according to the FR..

If we used the same words of the President Rajapakse to explain the charges against General Fonseka at a meeting he presided at Trincomale, these Directors have cheated the people as well as the government. It is now known by many that the MIG 27 Fighter Jets were purchased for a very inflated cost, and the payment was paid to a third party in another country and not to the particular country Lanka Logistics did the business with.

Dr. P.B.Jayasundera was charged for cheating the government on another transaction he got involved and was punished for that offence, but an appeal court rejected that judgement and set him Free.

As this MC judgement and the action of the President in approving the punishment is creating very serious discussions among many world leaders, and very soon we may have to face serious problems due to an incompetent Defence Secretary and his advisers, retired Major Generals Kapila Hendawitharane and Palitha Fernando. It is a laughing matter for the Attorney General Mohan Peiris, PC who is responsible to uphold the Law of the country is becoming a party to all this. If some one like former Army Commander General Fonseka is treated in this manner by the AG who is responsible as the custodian of the Law then what can an ordinary Sri Lankan expect from him.

We Sri Lankans placed our faith on the Defence Secretary Gotabaya Rajapaksa to uphold the Law and Order and completely eradicate the corruption from this country, but unfortunately now he has become a billionaire through all this Arms purchases according to some Financial Experts’ in Singapore .

[Gunadeera Rajakaruna is a Lawyer and a free lance journalist writing from Singapore ] Tell a Friend

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