Lanka President Stalls Bid To Buy Transport Equipment from India

Published: 13th December 2015 06:54 PM  |   Last Updated: 13th December 2015 06:54 PM   |  A+A-

COLOMBO: Sri Lankan President Maithripala Sirisena has put on hold a proposal by the Minister of Transport, Nimal Sripala de Silva, to buy rail locomotives and carriages; 500 omnibus engines and 500 gear boxes from Indian public and private sector suppliers using the remainder of an USD 800 million Indian Line of Credit extended in 2010, Sunday Times reports.

The Lankan President’s move follows an adverse report by a committee appointed by the Ministry of Transport to go into complaints about railway equipment previously imported from India under the Indian Line of Credit.

When the committee was appointed, government spokesmen told the media that all unsolicited foreign aided projects were being probed for probable malpractices and that the projects included Chinese-aided ones too.

Speaking to Express on the report, the Project Director of IRCON International Ltd, S.L.Gupta, said that the members of the investigating committee did not have the technical competence to judge the quality of the equipment or the reasons for any failure. He also said that a certain politically influential anti-India official was behind the move. 

In a press release issued on Sunday, Gupta said that IRCON is committed to rectifying the defects found during the defect liability period and substantial steps are already being taken in this regard. But he stressed the importance of proper maintenance, an area in which the Ceylon General Railway (CGR) is wanting. Sri Lankans cannot complain of malfunctioning of equipment if they do not maintain the equipment properly, Gupta argued. He urged the Lankan railways to provide proper training to its maintenance staff.

Describing the complaints of breakdowns as grossly exaggerated, Gupta pointed out that the railways are running six pairs of trains between Colombo and Jaffna every day on tracks laid by IRCON and these run to full capacity earning a good income. On October 3, the Lankan Minister of Transport visited the already executed 265 km Northern Railway project and expressed satisfaction about its execution.

Besides the utilized part of the earlier USD 800 million credit, the Government of India has extended another Line of Credit to the tune of USD 318 million as announced by Prime Minister Narendra Modi in March 2015, Gupta said. The credit comes at a modest interest of 1.25 percent, while other lenders charge Lanka 8 percent, he pointed out. Repayment will be due in twenty years but there is a grace period of five years.

Plans for the utilization of the new Line of Credit were discussed when the Lankan Prime Minister Ranil Wickremesinghe visited New Delhi in September this year, Gupta said.

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