The government will raise a loan of USD 44.3 million from India for the development of the Kankesanturai Port for commercial operations, Daily Mirror learns.
The port, located in the northern-most part of the country, could not be operated fully for decades due to damages sustained during the war.
There were also wrecks of vessels destroyed due to bomb attacks at the time. After the war was over in May, 2009, India pledged to assist in the restoration of the port for commercial activities which was agreed upon during President Mahinda Rajapaksa’s visit to India in June 2010.
The Memorandum of Understanding (MoU) and an Agreement to formalise this commitment were signed on July 21, 2011 between India and Sri Lanka.
The Indian High Commission said the Kankesanturai Harbour project would be aided by a mix of grant funding and concessional credit from the Indian Government. India initially committed approximately USD 20 million for three initial elements, consisting of the preliminary hydrographic survey, geotechnical investigations and the detailed project report preparation and wreck removal and salvage.
Besides, Dredging Corporation of India Ltd would undertake the second phase of dredging today.
Additionally, the Indian Government would provide additional grant funding for the dredging of the harbour and concessional credit for the rehabilitation of the breakwater and construction of a new pier and attendant port facilities.
An official of the Ports Development Ministry said the loan would be raised for the rehabilitation of the breakwater and the construction of a pier and other attendant facilities. India has given a USD 850 line of credit for the reconstruction of northern railway lines.
“We have decided to get this loan. The interest rate is being negotiated. We believe it will be a concessionary loan,” he said.
The Indian authorities have already completed wreck removal. Once it is commissioned, Sri Lanka already has one port constructed with financial assistance from China in Hambantota. (Kelum Bandara)