A controversy is brewing around a proposed steel manufacturing and export plant in Trincomalee which will have a major detrimental impact on the environmentally-sensitive Eastern town of Sri Lanka, Colombo Telegraph learns.

Nandana Lokuwithana

The government has already announced its plans to proceed with the construction of the controversial billion-dollar steel plant in the Trincomalee area. The Cabinet paper in this regard will be presented by Minister of Development Strategies and International Trade Malik Samarawickrama, a close ally of Prime Minister Ranil Wickremesinghe.

However, the project has sparked a major controversy as a steel plant —a polluting industry which will result in toxic waste products, acid rain-causing Sulpher Dioxide, heavy metal residues and gaseous outflows —will alter the eco-system of the Trincomalee area, home to Sri Lanka’s largest natural port.

“The proposed steel plant will cause irreparable damage to Trincomalee. Apart from causing visible pollution, it will also prevent high-value, clean industries from entering Trincomalee completely disrupting the current masterplan for Trincomalee development,” a source familiar with the project told Colombo Telegraph.

Colombo Telegraph is also in a position to reveal that controversial businessman Nandana Lokuwithana, a Dubai based Sri Lankan businessman, more popularly known as ‘Mariott Lokuwithana’ who is accused of money laundering, is behind the construction of the Trincomalee steel plant.

The controversial businessman acquired the Ceylon Steel Corporation in 2009 through his company ONYX Group, with the blessings of former President Mahinda Rajapaksa, and the questionable deal raised many eyebrows at the time.

Although the leaders of the current government constantly bashed Lokuwithana for hoarding money on behalf of the Rajapaksas, none of them effectively pursued investigations into the shady businessman and his questionable deals.

Colombo Telegraph is in a position to confirm that Lokuwithana, on behalf of the Ceylon Steel Corporation Limited and ONYX Group, has attended several meetings with Finance Ministry and BOI officials to discuss the implementation of the steel plant project in Trincomalee.

Lokuwithana, who is more popularly known as the ‘Sri Lankan who bought the Mariott Hotel in Dubai’ — which was reported to have belonged to the Rajapaksas — was also featured in the Panama Papers released by the International Consortium of Investigative Journalists (ICIJ)

While in power, Rajapaksa had reportedly invested heavily on properties in Dubai through Lokuwithana, who reportedly hails from Nattandiya, and was introduced to Rajapaksa by his one-time loyalist, Sajin Vass Gunawardena.

The businessman also shares a close relationship with Malik Samarawickrema who flouted the country’s laws in 2017 to facilitate Lokuwithana’s tyre factory in Horana for which Prime Minister Wickremesinghe laid the foundation stone.

Although any applicant who sought to get land from BOI was mandated to submit their application and be evaluated and submit the highest bid price over and above the minimum price of US$40,000 per acre in Horana Zone, Lokuwithana was exempted from this rule by Samarawickrama.

Lokuwithana managed to secure the 100-acre land at a special price for 99 years. “The BOI board had initially refused and turned Lokuwithana’s offer, however, he insisted and went to Samarawickrema for redress, who then submitted a paper to the Cabinet Committee headed by Prime Minister Ranil Wickremesinghe and got it approved,” our sources said explaining the background of Lokuwithana’s questionable deals with Samarawickrama.(Raveen Jayasooriya)