Sri Lanka plans to obtain a US $ 100 million interest-free loan facility from China Development Bank (CDB) to expand the proposed Port Access Elevated Highway to Marine Drive through Colombo Port City.
The Cabinet of Ministers on May 30 approved a proposal presented by Megapolis and Western Development Minister Patali Champika Ranawaka to sign a tri-party loan agreement with CDB and the Chinese investor of the project, CHEC Port City Colombo (Pvt.) Ltd.
Speaking to Mirror Business, Megapolis and Western Development Ministry Secretary Eng. Nihal Rupasinghe said that CDB has offered a US $ 100 million interest-free loan with a long-term tenure to CHEC Port City Colombo (Pvt.) Ltd and the government.
However, he noted that the conditions of the loan are yet to be worked out between the Treasury and CDB.
The Megapolis and Western Development Ministry and CHEC Port City Colombo (Pvt.) Ltd aim to reduce the traffic congestion in the area by connecting Colombo Port City to Port Access Elevated Highway.
Meanwhile, the Cabinet also approved another proposal presented by Ranawaka to form a joint property management company between the government and CHEC Port City, for the management and maintenance purposes of Colombo Port City.
Rupasinghe noted that the Cabinet approval was received only in principal and the details of the entity needed to be worked out.
The legal statutory framework of the new entity is being developed by the Attorney Generals Department in consultation with the Urban Development Authority (UDA), project company and Lands and Parliamentary Reforms Ministry.
Elaborating the main purposes of the entity, he said, We dont want to create a messy urbanisation. We want to introduce very strict regulations, in particular maintenance of the new city. Colombo Port City will be a well-planned city.
CHEC Port City and the Megapolis and Western Development Ministry have already unveiled the development guidelines of Colombo Port City, which was later gazetted. However, several legal requirements are needed to be completed before opening up the land plots for investors.
A key requirement is declaring the 269 hectares of the Colombo Port City land as part of Sri Lanka.
The government is in the process of declaring the reclaimed Colombo Port City land as a state-owned land in the Colombo District.
Presently, all lands of Colombo Port City are vested under the president and the Megapolis and Western Development Ministry is chairing them on behalf of the president. We have to get these lands transferred to the UDA under the UDA Act, he said.
Rupasinghe expects these legal procedures to be concluded in two to three months and the government also plans to offer an attractive investment incentive package for investors, which will include tax holidays and policy concessions.
We are still discussing on what concessions we could provide for investors, he added.
Further, the government also plans to present several pieces of legislation on Colombo Port City to Parliament, this month. They include regulation of financial activities to support Colombo Port City to become a financial hub in the region.
CHEC Port City completed the reclamation of 269 hectares of land earlier this year and the firm is currently involved in infrastructure development activities and completing the construction of the breakwater barrier.
The project officials are scheduled to complete the key infrastructure developments, including the road developments, within two years.
Rupasinghe also noted that the Ceylon Electricity Board and National Water Supply and Drainage Board are already in the Colombo Port City site working on the utility infrastructure developments.
The government is expected to invest US $ 1 billion in utility facilities, which would be recovered by selling electricity and water to Colombo Port City, while the Colombo Municipal Council plans to charge for sewage disposal from Colombo Port City.
Once completed, Colombo Port City is expected to host about 80,000 residents and 250,000 daily commuters, while attracting US $ 15 billion in investments during the project time period. (Nishel Fernando)