Sugar cane planting beginsSugar cane planting begins

On April 2017 land for the cultivation of sugar cane is given and on September 17, 2017 the cultivation begins. At this point Mahanama once again threatens the investor that unless he receives his bribe he will retake the land earmarked for sugar cane planting. By this time the investor had brought his British and South African partners to Sri Lanka.
 
Feeling that he has no other choice the investor approaches the Bribery Commission on February 2018. According to what has been revealed, Dr. Mahanama has told the investor that he needs to take a bribe because he wants an income after he retires. Mahanama has claimed that he plans to construct a building near the University of Kelaniya and rent it out.
 
Extorting money from investors
 
One of the tactics used by unscrupulous people like Mahanama is that they prepare cabinet papers with that make it difficult for investors to commence work, unless a bribe is paid. For example when preparing the cabinet paper regarding this investment, Mahanama states that none of the old machinery of Kantale Sugar factory can't be given to the new company and that he proposes to sell the old machines as scrap iron. In fact he calls for a tender to sell these machines at an estimated cost of Rs 340 million after misleading the President and the Prime Minister.

Article  7.9 of the shareholders agreement states that : 

The investor/company agrees to take possession of land and premises from the GOSL described in Article 7.1.1 (other than that described in Article 7.1.1 (c) with all the infrastructure and machinery, on an as is basis and no guarantee is given that any infrastructure, machinery, buildings or implements subsisting on the land or premises are usable or suitable for any purpose. The company may do as it may deem appropriate with the infrastructure, machinery, buildings or implements at it’s own cost or use them as it may deem suitable.
 
Thus all the 'infrastructure, machinery, buildings or implements subsisting on the land or premises are usable or suitable for any purpose' must be handed over to the investor for the 51% stake the government gets. Mahanama attempts to create an impression that the company is trying to sell the machinery as scrap metal and obtains an estimate to sell them, since there is no assistance from the government, the investor gets into trouble. If they go for arbitration, that committee is appointed by the Ministry Secretary. Mahanama tried to obtain US $ 3 million to release these assets to the company or around Rs 540 million. Then he later reduces his demand to Rs 100 million.

MG Sugar goes for arbitration in Singapore against the constant harassment and Mahanama retires, only to return as President’s Chief of Staff. He again approaches the investor promising to iron out all the issues he has and brings in Chairman of the State Timber Corporation P. Dissanayake to act as a mediator. 

Dissanayake who was the secretary to former President Chandrika Bandaranaike is a past master of extortion. He was known as 'Bar Piya' among MPs in the 90s and early 00s and has amassed considerable assets including two two story houses at Gregory's Rad, an apartment at Union Place, three bars in Gampaha, one in Matara and two houses in Battaramulla.
 
However the two men didn't know that the investor had already approached the Bribery Commission and that a number of officials had been keeping an eye on this case for a while.
 
This incident must not be considered an isolated incident or an indication of increasing corruption under the UNFGG government. For decades the investors who come to Sri Lanka have learnt that they need to pay large bribes to get their work on track. An investor who refuses to pay a bribe has no one to turn to. The BoI, whose Chairman is the highest paid state official (Rs 1 million), takes no responsibility after the initial agreement. In fact accessing the Chairman is more difficult than reaching the President or the Prime Minister. The Kantale investor told me that the only person who listened to his grievance was former Finance Minister Ravi Karunanayake.
 
He is also a businessman who has been working in Sri Lanka since 1994 and has high level connections. Any other investor would have just quit and told his colleagues never to invest in Sri Lanka.
 
The other point to consider is how Mahanama became the Chief of Staff of the President. I have repeatedly complained about Mahanama and a number of other organizations have raised concerns about his behaviour. However despite all of that he is appointed Chief of Staff of the President. I have also raised concerns about seven other state officials but there has been no investigations against them. This makes the public disillusioned about the government, which can only benefit the Rajapaksa's.