Vichara

The country is aware of several mafiosi like the diesel mafia, rice mill mafia and the drugs mafia which are a curse on the country. But it is very rare that people refer to the Pettah mafia which is the mother of all mafiosi. This mafia has existed from colonial times and grown in strength. Most members of this mafia have non-national roots but have captured the native bureaucracy and politicians. Today they lead a cabal consisting of Customs, Banks, Import Control and Consumer Affairs. The strength and influence of the Pettah Mafia was demonstrated during the Black July 1983 when Pettah was not touched by rioters although the neighboring Fort area was devastated. The secret is that Pettah was under the protection of highest-level political powers.

No government has been concerned about the control by the Pettah mafia on wholesale trade of commodities, particularly on their trade with India.  This in addition to their control on gold and jewelry trade in Sea Street.

During the foreign exchange crisis, it was believed that they operated and controlled the ‘Undial’ system with impunity. They are suspected to be the major culprits of misinvoicing at the customs with the connivance of customs and commercial bank personnel.

Sugar scam was one of the recent operations of the Pettah Mafia. It was evident that they had prior information of the substantial reduction of customs duty. The Consumer Affairs Authority could have entered into a binding agreement in terms of CA Act Section 14 with the traders on the sale price. But they did not and allowed the traders to make exorbitant profits. The Finance ministry is splitting hairs that there was no loss to the government and does not consider the imposition of a windfall tax as done in other countries.

The Pettah mafia has had no competition. D.S Senanayake established the Cooperative Wholesale Establishment (CWE) to cater to the cooperatives sector. During the time of Philip Gunawardena CWE was linked with the Multi-Purpose Cooperative scheme. It was the CWE and the cooperatives which served the nation during the 1983 riots when the private trade did hardly function. But surprisingly during the Yahapalana regime the whole sale function of the CWE was banned. This unwise and irrational move gave the Pettah mafia a free run in the import trade particularly with India. It has become a profitable haven.

Politicians and civil society organizations are concerned about the growing Indian influence with the proposed Indian investments like that of Adani and Amul and their impact on the economy and security of the country. But no mention is made of the long standing Indian enclave in Pettah.

It is deplorable that while India has made inroads or in the process of making inroads into strategic economic spheres of the country, they are griping over a barren piece of land in the Kacchativu. Sri Lanka may have to consider ceding Kacchativu Island to India regardless of the good will agreement the country had with PM Indira Gandhi and invite a foreign power to take over Trincomalee on our terms.

It is proposed that the government appoints a Commission with clear terms of reference to investigate and report on the structure, role and the impact on the economy of this non-national/ acquired national enclave.

The original role of the CWE should be restored and given the power and funds to engage in the wholesale import, storage and distribution of essential commodities. One of the advantages that Pettah traders have is their well-established network of trade contacts in India. CWE should establish a branch in India to create such an effective network.

Vichara