COLOMBO: Sri Lanka must use its ports and strategic location for economic growth, President Ranil Wickremesinghe said on Friday while expressing regret over the abandonment of the country’s trilateral agreement with India and Japan to develop the eastern container terminal of the Port of Colombo.
Former Prime Minister Mahinda Rajapaksa’s office said on February 1 last year that his government had decided to manage the Eastern Container Terminal at the Port of Colombo (ETC) as a company wholly owned by the public port authority.
India, Japan and Sri Lanka signed an agreement in 2019 on the development of the Eastern Container Terminal project.
“Our strategic location is also a way to improve our economic prospects. First, our location indicates that we should be a logistics hub with three good ports,” he said.
Wickremesinghe said it was unfortunate that the trilateral agreement with India and Japan to develop TCE was scrapped.
“The last time I was prime minister, I wanted to get things done. We had an agreement on the eastern terminal with Japan and India. We canceled it. It’s still there. The port is unable to We don’t have the money,” he said.
The Sri Lanka Ports Public Authority (SLPA) signed a Memorandum of Cooperation in May 2019 with India and Japan to develop ECT under the previous Sirisena government.
Colombo port unions have opposed a proposal by Indian and Japanese investors to acquire a 49 per cent stake in ETC. They demanded that ECT be 100% owned by SLPA.
They claimed that the proposed deal with India’s Adani Group was a sale of ECT. The Adani Group was then entrusted with the development of the western terminal.
Former President Gotabaya Rajapaksa had said he wanted the India-Japan ECT deal to go ahead.
However, after a week of protests, Prime Minister Mahinda Rajapaksa agreed to drop the deal, prompting India to demand Sri Lanka honor its commitment to the trilateral deal with it and Japan.
Japan has also expressed its dissatisfaction with the Sri Lankan government.
Wickremesinghe said the development of the port would enable Sri Lanka “to be the feeder port for Pakistan, India and Bangladesh”.
“We had the port of Hambantota. When the Belt and Road Initiative is completed, Hambantota Port will be connected to several Chinese ports, which have been built by Chinese companies in Africa and some of the other ports.
“Look at the opportunities we have. And now we are looking at Trincomalee Port to work with India, which will service the Bay of Bengal. These are new opportunities,” he said.
Wickremesinghe said the population of these regions will grow “just from Pakistan to Indonesia by about 400 or 500 million by 2050. Asia, the Middle East and Africa will see even greater growth.”
Describing his reforms for economic recovery, Wickremesinghe said that the government should take care of the task of providing for the needs of the people and focus on the sectors of health, education, housing and social assistance.
“The management of companies should be managed by the private sector, the government cannot get involved in the management of companies,” he said.
“We are in the midst of an unprecedented financial crisis, which many countries around the world have not faced. We got into this because we followed the wrong policies. We were thinking about policies, not practical outcomes,” he added.
Sri Lanka, a country of 22 million people, plunged into financial and political turmoil earlier this year as it faced a shortage of foreign currency. It declared bankruptcy in mid-April and suspended repayment of its $51 billion foreign debt, of which it must repay $28 billion by 2027.
India has provided a lifeline to Sri Lanka by providing aid worth $4 billion to pay for fuel and essentials.

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