After Scrapping Eastern Container Terminal Agreement, Sri Lanka Offers Western Container Terminal For India And Japan

After scrapping an agreement to develop a strategic East Container Terminal (ECT) at the Colombo port with help from India and Japan, the Sri Lankan government has decided to offer the West Container Terminal (WCT) to Indian and Japanese companies.

According to the Sri Lankan government’s department of information, the Lankan cabinet “has approved the proposal to develop the West Container Terminal on Build, Operate and Transfer basis for a period of 35 years as a public-private partnership with Adani Ports and Special Economic Zone Limited and its local representative John Keels Holding PLC, and the Sri Lanka Ports Authority.”

“Accordingly, the Build, Operate and Transfer Plan approved by the negotiating committee had been forwarded to the High Commission of India and the Embassy of Japan, requesting them to nominate investors. The proposal presented by the Adani Ports and Special Economic Zone Limited (APSEZ consortium) has been approved by the Indian High Commission. However, no investor has been named by the Japanese government,” the government decision said.

While the Sri Lankan government said the proposal by Adani Ports and SEZ consortium has been “approved by the Indian High Commission (in Colombo)”, Indian government sources have however disputed this, reports The Indian Express.

India has been keen on the ECT agreement as it wants to make its presence felt at the Colombo Port as transshipment of Indian cargo accounts for nearly three-fourths of the port’s business.

This is particularly in view of a Chinese company, backed by the Xi Jinping government, operating an international container terminal at the Colombo harbour adjacent to the Eastern Container Terminal.

New Delhi also considers the Indian Ocean region to be its strategic backyard and has expressed its concerns over Beijing’s economic and political influence over Colombo.

China, on the other hand, considers Sri Lanka to be a critical link in its massive Belt and Road Initiative and has provided billions of dollars in loans for its projects over the past decade. The projects include a seaport, airport, port-city, highways and power stations.