India’s Increasing Investments In Sri Lanka
India and Sri Lanka have signed an agreement worth US$ 91.26 million for upgradation of the railway track from Maho to Omanthai that covers 130 kms. The agreement assumes significance as the line would be upgraded for the first time in 100 years. India’s contribution towards improving Sri Lankan Railways is well known and so far New Delhi has committed US$ 1.3 billion alone for the development of railways in the island country.
This indicates that India is keen to improve its investments and is open to joint investments with third countries. The projects undertaken by India are people-centric projects focusing on health, education and connectivity. This month itself, 100 model villages built with Indian assistance were inaugurated in Gampaha District. These villages are part of 2400 villages India promised to build across Sri Lanka in addition to the 60,000 houses that are being built in the war affected North and East as well as central part of Sri Lanka. In another instance, an Island wide ambulance service is provided by India was well appreciated by Sri Lankan people. By helping to build model villages across the country, not just in Tamil dominated North and East, India has sent a positive message of cooperation, particularly for building trust which is needed for enhancing strategic cooperation.
These are important aspects of India’s cooperation. Despite the internal turbulence in Sri Lankan politics, India’s development projects are being implemented without much delay. The forthcoming Presidential elections and political chaos within Sri Lanka due to differences between President Maithripala Sirisena and Prime Minister Ranil Wickramasinghe has occupied much of the political debate in Sri Lanka. The Easter Sunday attacks have put the country’s security situation in jeopardy. India responded cautiously to the political turbulence within Sri Lanka and asked the country’s leadership to solve the differences through constitutional means. To address the security issue, India has urged for determined collective action by the international community to combat terrorism across borders.
India has been able to increase its investments in strategic sectors such as ports. India, Japan and Sri Lanka have agreed to jointly develop the ‘East Container Terminal’ at Colombo port. The decision to take up the joint project is seen as an important move to check China’s continuous foray into the region. Beijing has got the strategically important Hambantota port on a 99 year lease.
In April 2019, a new railway line was opened connecting the coastal city of Matara and Beliatta in Hambantota, the first investment by China in railway projects in Sri Lanka under the Belt and Road initiative (BRI).
India is also developing the Kankesanthurai harbour in the Northern Province with US$ 45.27 million financial assistance. In March 2019, the foundation stone was laid to construct an oil refinery near Hambantota port worth US$ 3.85 billion a joint venture between a Singapore registered firm having connection with Indian business and Oman's oil ministry. The Prime Minister of Sri Lanka also welcomed the multinational investment near Hambantota. India is also keen to develop the Trincomalee harbour as well as Matala Airport, but modalities and investment are yet to be finalised.
Energy and connectivity are another area where both the countries have shown keen interest in enhancing cooperation. The 4thmeeting of the Joint Working Group (JWG) on Cooperation in Power Sector between India and Sri Lanka was held in June 2019 to review solar power project in Sampur near Trincomalee and LNG project in Kerawalapitiya.
Connectivity has remained an issue for long due to the ethnic conflict as well as due to commercial viability of ferry services between ports such as Kankesanthurai and Karaikal near Puducherry. With the development of Kankesanthurai harbour with India’s assistance, it is expected that connectivity between the two countries would be enhanced. This will also benefit trade and tourism.
These developments indicate that India has diversified its cooperation with Sri Lanka. However, India needs to improve its strategic foothold in the Indian Ocean country.
Script: Dr. M. Samatha, Strategic Analyst on Indian Ocean Region
This indicates that India is keen to improve its investments and is open to joint investments with third countries. The projects undertaken by India are people-centric projects focusing on health, education and connectivity. This month itself, 100 model villages built with Indian assistance were inaugurated in Gampaha District. These villages are part of 2400 villages India promised to build across Sri Lanka in addition to the 60,000 houses that are being built in the war affected North and East as well as central part of Sri Lanka. In another instance, an Island wide ambulance service is provided by India was well appreciated by Sri Lankan people. By helping to build model villages across the country, not just in Tamil dominated North and East, India has sent a positive message of cooperation, particularly for building trust which is needed for enhancing strategic cooperation.
These are important aspects of India’s cooperation. Despite the internal turbulence in Sri Lankan politics, India’s development projects are being implemented without much delay. The forthcoming Presidential elections and political chaos within Sri Lanka due to differences between President Maithripala Sirisena and Prime Minister Ranil Wickramasinghe has occupied much of the political debate in Sri Lanka. The Easter Sunday attacks have put the country’s security situation in jeopardy. India responded cautiously to the political turbulence within Sri Lanka and asked the country’s leadership to solve the differences through constitutional means. To address the security issue, India has urged for determined collective action by the international community to combat terrorism across borders.
India has been able to increase its investments in strategic sectors such as ports. India, Japan and Sri Lanka have agreed to jointly develop the ‘East Container Terminal’ at Colombo port. The decision to take up the joint project is seen as an important move to check China’s continuous foray into the region. Beijing has got the strategically important Hambantota port on a 99 year lease.
In April 2019, a new railway line was opened connecting the coastal city of Matara and Beliatta in Hambantota, the first investment by China in railway projects in Sri Lanka under the Belt and Road initiative (BRI).
India is also developing the Kankesanthurai harbour in the Northern Province with US$ 45.27 million financial assistance. In March 2019, the foundation stone was laid to construct an oil refinery near Hambantota port worth US$ 3.85 billion a joint venture between a Singapore registered firm having connection with Indian business and Oman's oil ministry. The Prime Minister of Sri Lanka also welcomed the multinational investment near Hambantota. India is also keen to develop the Trincomalee harbour as well as Matala Airport, but modalities and investment are yet to be finalised.
Energy and connectivity are another area where both the countries have shown keen interest in enhancing cooperation. The 4thmeeting of the Joint Working Group (JWG) on Cooperation in Power Sector between India and Sri Lanka was held in June 2019 to review solar power project in Sampur near Trincomalee and LNG project in Kerawalapitiya.
Connectivity has remained an issue for long due to the ethnic conflict as well as due to commercial viability of ferry services between ports such as Kankesanthurai and Karaikal near Puducherry. With the development of Kankesanthurai harbour with India’s assistance, it is expected that connectivity between the two countries would be enhanced. This will also benefit trade and tourism.
These developments indicate that India has diversified its cooperation with Sri Lanka. However, India needs to improve its strategic foothold in the Indian Ocean country.
Script: Dr. M. Samatha, Strategic Analyst on Indian Ocean Region
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