The port is emblematic of the controversy dogging Chinese President Xi Jinping’s Belt and Road initiative
from Kenya to Myanmar, including accusations that the world’s second-largest economy
is luring poor countries into debt traps. In Sri Lanka, where the transaction to lease the port was opposed by Rajapaksa’s party, Mahinda took Chinese loans during his 10-year rule as president to build the project in his home district.
“This is a sovereign agreement” and it’s unlikely that it will be scrapped or altered in a big way, said Smruti Pattanaik, a research fellow at the Institute forDefence Studies andAnalyses in New Delhi. “The Chinese may reconsider some clause, if it is considered crucial for the Rajapaksa
An attempt to rework the transaction will help the new Sri Lankan government, led by Gotabaya and his brother Mahinda, showcase their drive to change contracts seen as hurting national security, a key campaign platform for Gotabaya, a former defense secretary.
cooperation, including the Hambantota port
project, are built on the basis of equality and consultation,” China’s Foreign Ministry said in a faxed statement from its spokesperson’s office. “China looks forward to working with Sri Lanka
to make Hambantota a new shipping hub in the Indian Ocean and developing the local economy.
China’s infrastructure-building in Sri Lanka
became part of Beijing’s Belt and Road Initiative, prompting concern in India about its geopolitical rival using a port close to its southern coastline for future military or strategic uses. Gotabaya is in India on Friday for his first state visit overseas.
China has dismissed worries over any military dimension to its investment in the Hambantota port, which lies on the main shipping routes between Asia and Europe, and said it was mutually beneficial that would aid Sri Lanka’s economy.
“Sri Lanka will have to offer it something equally, if not more, attractive in financial terms for Beijing to agree to the cancellation of the lease agreement,” said Brahma Chellaney, a professor of strategic studies at the Center for Policy Research in New Delhi. “With the Rajapaksa
family back in power, China hopes to expand its footprint in Sri Lanka.”
A similar port deal under the Belt and Road program in Myanmar was drastically scaled to $1.3 billion from $7.5 billion, while in Malaysia the government canceled $3 billion worth of pipelines and renegotiated a rail project in 2019, cutting that one’s cost by a third to $11 billion.
“Bilateral agreements once you’ve signed those, are serious agreements,” Cabraal said in his house adorned with pictures of local and foreign leaders. “At the same time, we’ve got to look after the national interests. And if one government had bartered it away, there is a necessity for the new government to find ways and means by which it can be done amicably.”
For its part, China Merchants, whose $93 billion of revenue dwarfs Sri Lanka’s gross domestic product, has been able to use its experience stretching from China to Europe to help kick start the Hambantota port, which once hardly attracted any ships.
China Merchants’ Hambantota joint venture also last month said it had entered into an agreement with Japanese shipping conglomerate Nippon Yusen KK, for vehicle transshipment through the port.