The „Panichankerni Reconstruction Scheme“ centres on the construction of 130 houses including basic infrastructure and community facilities in the fisher village of Panichankerni in the Vaharai area on the East Coast of Sri Lanka. The village is situated 60 km north of Batticaloa town at the border of the LTTE and government controlled area.
Despite legal disorder, increasing political tensions and security problems, the project progressed well until mid 2006. In February 2006, a first slot of 42 houses could be handed over. Shortly afterwards the political situation started to worsen dramatically. By August 2006, the construction work came to a complete standstill because the army rigorously closed the access road. In the second half of 2006 intensive fighting was going on in the Panichankerni area. All inhabitants left the village and fled to a refugee camp in the south.
Towards the end of 2006 it became clear that the situation was not likely to change in the near future. Helvetas/Skat therefore decided to close down the project activities in Panichankerni. Up to the stop of the construction work in August 2006, the 88 houses of the second slot had been completed at an average of 75%.
Helvetas/Skat requested SwS to maintain the option of an eventual finishing of the project at a later time in case of an improvement of the political situation.