Sri Lanka today announced a partnership with India and Japan to build a terminal dedicated to deep-water container ships in the port of Colombo, near a controversial large landing site run by China. The Sri Lankan Port Authority (SLPA), controlled by the Sri Lankan state, said a cooperation agreement had been signed between the three countries to develop the “Eastern Terminal” of the port of Colombo. Sri Lanka will retain 51% of the capital of the company that will manage the terminal, with the remainder going to India and Japan. The cost of the project was not specified.
“The agreement illustrates Sri Lanka’s ability to preserve and advance its national interests while cooperating with international partners,” said a statement from SLPA, noting that Indian cargo ships account for 70% of container traffic in Colombo. The adjacent terminal, the Colombo International Container Terminal (CICT), which was launched in 2013 and cost some $500 million, is 85% owned by China and 15% by SLPA.
Unable to meet its debt repayments, Colombo had to hand over to Beijing at the end of 2017 full control for 99 years of the deep-water port of Hambantota, which borders the world’s busiest east-west shipping route, in a deal that had caused controversy in Sri Lanka and abroad. This Chinese anchorage 240 kilometres south of Colombo is causing concern from both India and the United States because it could give Beijing a naval military advantage in the Indian Ocean.
Sri Lanka insisted that its ports would not be used for military purposes. In 2014, however, Chinese submarines entered the CICT, prompting a strong reaction from the Indian authorities. These “visits” have since been formally prohibited by Sri Lanka.
