The body of Pattani Razeek, the head of a Muslim relief fund, was found buried at a building site last week, 17 months after he disappeared.
The police have arrested Shabdeen Naushad, who witnesses say bundled Razeek into a waiting van in Polonnaurwa, 180 kilometres north of Colombo, in February 2010. The police also said they traced telephone calls made by the suspect in connection with the case.
Protesters allege that Naushad has so far not been prosecuted because he is employed by an institution linked to the Ministry of Industry and Commerce, and worked on the most recent election campaign of Rishard Bathiudeen, the current minister.
An estimated 7,000 protesters chanted slogans against Bathiudeen at Razeek's funeral in a village 50 kilometres south of Polonnaurwa. The also called for a shutdown in Puttalam, the nearest main town.
The minister has denied any connection with the kidnapping and murder.
The victim's son Riz Khan Razeek told the German Press Agency dpa that his father resisted pressure by the minister's office to contribute to the campaign fund of the ruling United People's Freedom Alliance.
'There was also political pressure from the minister to delay the investigations into the abduction,' he said.
Razeek's presumed abductors demanded a ransom of 20 million rupees (182,000 US dollars) from his son, but he said he could not afford the payment.
Razeek was the managing trustee of the Community Trust Fund, a primarily Muslim organization which helped victims of the 1983-2009 civil war in the north and eastern parts of the country.
The Office of the UN High Commissioner for Human Rights said after the arrest last week, 'We hope that investigation and prosecution of this crime will now be expedited.'
Ravina Shamdasani, a spokeswoman for the UNHRC in Geneva, said the office also called for 'similar progress in resolving the many thousands of outstanding cases of disappearance in Sri Lanka.'
Most disappearances happened during the government forces' 26-year conflict with Tamil separatists in the north and eastern areas.
She also encouraged Colombo to accept the assistance of the UN Working Group on Enforced and Involuntary Disappearances, which has 5,653 outstanding Sri Lankan cases on its books, and to invite it to visit Sri Lanka
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