India, Japan back in another Sri Lanka port project
- Posted By
10Pointer
- Categories
Economy
- Published
3rd Mar, 2021
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Context
India and Japan will develop the West Container Terminal (WCT) at the Colombo Port. The High Commission of India had “approved” Adani Ports for the project.
About the project
- Under the project, India and Japan will develop the strategic Colombo Port’s Western Container Terminal (WCT) under a joint venture.
- Time period: 35 years
- Investors:
- India: Adani Ports, which had earlier been nominated to develop the ECT, has secured the Indian nomination for developing the WCT.
- Japan: Japan is yet to nominate its investor.
- Stake: Unlike in the case of the ECT, where India and Japan were to jointly own 49 per cent of the stake, the two will have 85 per cent stake in the WCT.
Background
- The decision comes a month after the Rajapaksa government ejected the two partners from a 2019 tripartite agreement to jointly develop the East Container Terminal (ECT), citing resistance to “foreign involvement”.
- The month-long saga of withdrawing from an agreement on ECT and offering the WCT in return comes at a time when Sri Lanka is facing the heat at the Human Rights Council (HRC) in Geneva.
- A UN report has called for drastic measures against those allegedly responsible for rights violations in the final phase of the armed conflict with the Liberation Tigers of Tamil Eelam (LTTE).
- The approval for a new project within a few months finds its strategic significance for India and Sri Lanka both.
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Some other projects of India with Sri Lanka
Economic Cooperation
- Sri Lanka is one of India’s largest trading partners among the SAARC countries. India in turn is Sri Lanka’s largest trade partner globally.
- The main framework for bilateral trade has been provided by the India-Sri Lanka Free Trade Agreement (ISFTA) that was signed in 1998 and entered into force in March 2000.
- India is also investing in Sri Lanka’s infrastructure development in the Northern and Eastern provinces.
- India also invested in building Trincomalee Port to counterweight the Chinese developments at Hambantota Port.
Regional Strategic cooperation
- Sri Lanka is a member of regional groupings like BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) and SAARC in which India plays a leading role.
- India and Sri Lanka conduct joint Military ('Mitra Shakti') and Naval exercise (SLINEX).
- The government of India formally launched the e-Tourist Visa (eTV) scheme for Sri Lankan tourists in 2015 to increase the people-to-people contact.
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