It said Prime Minister Chandrika Bandaranaike Kumaratunga, whose People's Alliance (PA) won a narrow victory in the August 16 general election, had cancelled further payments on the $73 million deal and ordered an inquiry.
Military sources said the equipment was ordered by the previous government for a major offensive against the Liberation Tigers of Tamil Eelam rebels, fighting for independence in the island's north and east.
The Sunday Island said an unnamed state bank had already made an initial payment of 10 percent of the cost of the package, although the payment did not have the approval of parliament or the Finance Ministry.
Six BMP infantry fighting vehicles, of a total of some 200 armored vehicles on order, were airlifted to Sri Lanka from Russia for training purposes two weeks ago, military sources said.
PA spokesman Dharmasiri Senanayake, now the Minister of Information, Tourism and Aviation, said before the election the party might not honor the deal if it was voted into power.
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