Sri Lanka seeks Japanese leadership and Indian investments to counter-balance China
PK Balachandran, Sri Lanka Correspondent, bdnews24.com
Published: 2017-04-12 22:06:44.0 BdST Updated: 2017-04-12 22:06:44.0 BdST
Given its uneasy relations with China on account of the controversial deal over the $1.4 billion Hambantota port, Sri Lanka is trying to checkmate the Asian giant by cultivating Japan and India.
Prime Minister Ranil Wickremesinghe on Tuesday urged Japan to take the lead in ensuring maritime security and economic development in the Indo-Pacific region, given the fact that the US is gradually withdrawing from this region.
Earlier, Wickremesinghe got the cabinet to endorse a wide-ranging MOU with India, under which a plethora of Joint Ventures will be set up in the power, petroleum, highways and railways sectors.
With both Japan and India keen on investing in Sri Lanka and ensuring unfettered maritime navigation, the response to Wickremesinghe’s proposals are expected to be favourable.
Delivering the keynote address at the business forum organised by the Japan External Trade Organization (JETRO) in Tokyo on Tuesday, Wickremesinghe welcomed Japanese Prime Minister Shinzo Abe’s ‘Free and Open Indo-Pacific Strategy’ which seeks to promote connectivity through a free and open Indo- the Pacific Ocean, thereby ensuring economic prosperity in the region.
“Japan has become more important now as America shows reluctance to be involved in the economics of the region, especially with its withdrawal from the Trans-Pacific Partnership,” Wickremesinghe said.
He hailed Japanese Prime Minister Abe’s $110 billion contribution to the Asian Development Bank to build “quality infrastructure” in Asia.
But he stressed the need for a 'comprehensive plan of implementation' in the light of other regional powers also having their own strategies for the region such as China’s ‘One Belt, One Road’ initiative and India’s ‘Look East Policy’.
Wickremesinghe told Japanese businessmen that Sri Lanka is the most suitable country for them to focus on, given its strategic location in the Indian Ocean and the access, the country would provide to bigger markets through various existing and future Free Trade Agreements (FTAs).
With Sri Lanka also poised to become a logistics hub, the Prime Minister invited Japanese investment in the Colombo and Trincomalee Ports.
“The new Terminal at Colombo will soon be open for investment. We invite Japanese companies for a joint venture. We also hope to further expand Colombo Port to the North up to 8—10 miles reaching Ja-Ela, making it the largest in the Indian Ocean. Also, we have
invited Japan to partner with India to develop the Trincomalee harbour,” he said.
On the other hand, Sri Lanka and India have tentatively agreed to set up joint venture to
establish a Liquefied Natural Gas (LNG)-fired 500 MW capacity power plant as well as an LNG Terminal/Floating Storage Regasification Unit (FSRU) in Kerawalapitiya. Other power plants will also be converted to LNG.
A 50 MW (extendable to 100 MW) Solar Power Plant will be set up in Sampur. A Joint Venture to develop the Upper Tank Farm in Trincomalee comprising 84 giant oil tanks will be set up. A land lease agreement for 50 years for Lanka Indian Oil Corporation (LIOC) Ltd will be inked.
Joint investments will be made in the development of the Trincomalee port, a petroleum refinery and other industries there. Industrial Zones or Special Economic Zones in identified locations will be set up in other parts of Sri Lanka as well.
The Dambulla-Trincomalee, Mannar-Jaffna and Mannar-Trincomalee roads are converted into highways with Indian help. The railway sector will be improved with track upgrading and new rolling stock. Indian companies will be encouraged to invest in a container terminal in Colombo Port, considering the fact that 70 percent of the port’s trans-shipment business is with India.
These deals are expected to be signed when Indian Prime Minister Narendra Modi visits Sri Lanka on May 12. But the left-nationalist Janatha Vimukthi Peramuna is against the handing over the ports and the oil tanks to India.
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