Relations between Sri Lanka and India hit a new low yesterday after Prime Minister Mahinda Rajapaksa announced that Sri Lanka will not go ahead with the agreement to jointly manage the East Container Terminal (ECT) at the Colombo Port with India and Japan.
Sources in New Delhi told the Daily Mirror that the Indian Government is likely to express serious disappointment at Sri Lanka’s decision at a higher level.
While India is expected to maintain its interest on Sri Lanka and continue funding key projects to counter China’s stronghold on the island, the decision not to implement the agreement signed in 2019 will however see strong reactions from Delhi, sources said.
The Memorandum of Cooperation among the three Governments of Sri Lanka, Japan and India on the development of the East Container Terminal located in the Colombo South Port was signed in Colombo on May 28, 2019. Then Ports and Shipping and Southern Development Minister Sagala Ratnayaka who signed the agreement on behalf of Sri Lanka in 2019 insisted that the ECT was not “sold” to India or Japan.
“The original discussion was for them to operate it for 35 years but we later brought it down.we had a consultant working with us and we were to work it all out by November.
But there was a government change,” he said.
He told the Daily Mirror that there was also no opposition to the agreement at the time and that Sri Lanka stood to greatly benefit from the deal.
As per the 2018 agreement India and Japan were to have a 49% stake collectively in the Terminal Operations Company that was to be set up with the exclusive and explicit purpose of providing the equipment and systems necessary for the development of the ECT and managing the ECT for long periods. Under the agreement the stake of 51% of the TOC was to belong to the Government of Sri Lanka under the Sri Lanka Ports Authority (SLPA). It was recently speculated that Chinese intelligence agencies were behind the opposition by trade unions to the ECT deal. Indian diplomatic sources told the Daily Mirror they are still of the strong view that Chinese agencies were funding some protests against the ECT. However, there has not been any evidence to back the claims.
Meanwhile, the Indian High Commission in Colombo issued a quick response after Prime Minister Mahinda Rajapaksa announced that the ECT will be fully managed by Sri Lanka.
“I would like to reiterate the expectation of the Government of India for expeditious implementation of the trilateral Memorandum of Cooperation (MOC) signed in May 2019 among the Governments of India, Japan and Sri Lanka for the development of ECT with participation from these three countries,” a spokesperson at the Indian High Commission in Colombo told reporters.
The spokesperson said that the commitment of the Government of Sri Lanka with regard to the ECT has been conveyed several times in the recent past, including at leadership level.
“Sri Lanka cabinet also took a decision three months ago to implement the project with foreign investors,” the spokesperson said. (Easwaran Rutnam)