Sri Lankan school girls stand on the edge of a sea port in Colombo in this 2013 image Photo: AFP/File
business

Sri Lanka revives port deal with India, Japan

7 Comments
By LAKRUWAN WANNIARACHCHI

Sri Lanka's President Gotabaya Rajapaksa on Wednesday announced the revival of an Indian and Japanese investment project to develop a deep-sea terminal in Colombo harbour, next to a controversial $500-million Chinese-run container jetty.

A tripartite deal by Sri Lanka's previous government had been on hold amid trade union resistance, but Rajapaksa said the East Container Terminal (ECT) would proceed.

Approval came after reviewing "regional geo-political concerns," Rajapaksa's office said, a reference to India's suspicion of China's role at the same port.

The terminal will be developed with 51 percent ownership by Sri Lanka's government and the remaining 49 percent as an investment by India's Adani Group and other stakeholders including Japan, officials said.

The state-run Sri Lanka Ports Authority (SLPA) entered into a memorandum of cooperation in May 2019 with Sri Lanka, India and Japan to develop the ECT before Rajapaksa came to power in November 2019.

The deep-sea jetty is located next to the Colombo International Container Terminal which is 85 percent owned by China and was commissioned in 2013.

The SLPA owns the remaining 15 percent.

India lodged protests when Chinese submarines made unannounced visits to the Chinese-managed terminal in 2014.

Since then, Sri Lanka has refused permission for further submarine calls.

Nearly 70 percent of transshipment containers handled by Colombo was Indian export-import cargo.

In December 2017, Sri Lanka, unable to repay a huge Chinese loan, handed over another deep sea port in the south of the island to a Beijing company in a deal that raised concerns at home and abroad.

The $1.12 billion deal, first announced in July 2016, allowed a Chinese state company to take over the Hambantota port, which straddles the world's busiest east-west shipping route, on a 99-year lease.

India and the United States are both concerned a Chinese foothold at Hambantota, 240 kilometers south of Colombo, could give it a military naval advantage in the Indian Ocean.

Sri Lanka has insisted its ports will not be used for any military purposes.

© 2021 AFP

©2021 GPlusMedia Inc.

7 Comments
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In December 2017, Sri Lanka, unable to repay a huge Chinese loan, handed over another deep sea port in the south of the island to a Beijing company in a deal that raised concerns at home and abroad.

So the Sri Lankan government could not repay a loan to China and what do they do?

Borrow more money from India and Japan.

Yep. That should solve the problem, until they lose that port as well.

1 ( +2 / -1 )

Only borrow from foreigners if they agree to be paid in your own currency.

0 ( +0 / -0 )

I have to remind you that the whole China debt-trap diplomacy and BRI imperialism are propaganda from an Indian think-tank who is close to the BJP. Narendra Modi pushed this myth because his party intended to ignite a conflict with China in the Himalayas to spite Pakistan.

https://www.chathamhouse.org/2020/08/debunking-myth-debt-trap-diplomacy

0 ( +1 / -1 )

"Borrow more money from India and Japan."

Read the article again. Does not mention any debt involved. The terminal will have 51% ownership of SL government and remaining 49% will be owned by Indian and Japanese stakeholders, which translates into equity investment, not debt.

1 ( +1 / -0 )

"I have to remind you that the whole China debt-trap diplomacy and BRI imperialism are propaganda from an Indian think-tank who is close to the BJP. Narendra Modi pushed this myth because his party intended to ignite a conflict with China in the Himalayas to spite Pakistan."

LOL even Modi knows that India does not have the capability to take on China.

"The $1.12 billion deal, first announced in July 2016, allowed a Chinese state company to take over the Hambantota port, which straddles the world's busiest east-west shipping route, on a 99-year lease."

So the fact that Hambantota port actually got taken over when SL was unable to repay the debt is also propaganda for you?

0 ( +0 / -0 )

China has SL and many such third world nations run by corrupt dictators by the balls. it is the poor who will need to pay this debt for generations to come.

These counties were coned into (and the dictators were more than happy to go with the scams with the personal benefits they received) constructing nonviable ports, airports, roads railways, and when the debt becomes unpayable, they simply have to hand these properties over to the Chinese free of charge and continues to pay back the loans, And eventually, the only option these nations have is to hand over the bits and pieces of their nations

0 ( +0 / -0 )

nations like SL are indebted to Japan for the amount of goodwill done by the Japanese over the past few decades, there will never be such generosity by the Chinese, never!

1 ( +1 / -0 )

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