Sri Lanka Invites Adani Group To Discuss East Container Terminal Deal

NEW DELHI: India’s Adani Group has been invited by the Sri Lanka Ports Authority (SLPA) to discuss the terms of a proposed agreement to develop the East Container Terminal of Colombo Port. Sri Lankan sources have told StratNews Global that in keeping with President Gotabaya Rajapaksa’s assurances to port trade unions, the terminal will remain under the control of the SLPA which will have 51 per cent stake while the Adani Group will own the remaining 49 per cent. This gets around the sticky issue of Sri Lankan sovereignty.

President Rajapaksa has been telling the unions that an Indian company is being invited because between 66 and 70 per cent of business at the terminal comprises Indian transshipment. The sources said he has also assured that the government is not selling the rights. The government is forming a company that will sell stakes to an Indian investor.

Earlier this month, the Sri Lankan media had reported the president as telling the unions that the terminal would be neither sold nor leased. The media reports said the project reflected the government’s need to balance geopolitical concerns (read India) and Sri Lankan sovereignty among other issues.

For India, the stakes are high. China has made deep inroads into Sri Lanka and is already executing the multi-billion dollar Colombo Port City project. Delhi is concerned that the terminal project does not pass into China’s hands given that much of the business generated will be in the transshipment of goods meant for India. This will go against India’s strategic interests.

India has made known to Sri Lanka several times its desire to develop the terminal. This had been conveyed through the Indian mission in Colombo and during bilateral meetings. Last week, Anurag Srivastava, spokesperson of the Ministry of External Affairs, told journalists: “We have engaged with the Sri Lankan government to take this project forward and we’ll be happy to see the development of the East Container terminal through investments from India and Japan, as is preferred by the current Sri Lankan government.”