Apprehensive of increasing influence of China in South Asia, India raises serious objection to the Chinese-funded 'Port City Project' in Sri Lanka. A brainchild of former Sri Lankan president Mahinda Rajapaksa, the Port City was meant to be a planned offshore city in Colombo. The Sri Lankan newspaper Daily Mirror today reported on the suspension of the project. Rajitha Senaratne, the cabinet spokesman and health minister, has reportedly said that the project will be suspended and re-written due to pressure from India. Though the Chinese government is yet to respond to the new development, clearly, the project in Sri Lanka has turned out to be the latest contest ground for the two economic superpowers India and Pakistan, as both countries try to extend their geo-political influence over Asia.
According to the health minister, the Indian government had forewarned the Sri Lanka government about the "negatives" in the event Sri Lanka went ahead. Reportedly, India said that once completed, the project will not come under the jurisdiction of Sri Lanka and will leave a "big question mark on Sri Lanka’s sovereignty.” It seems that India expressed concern to the Sri Lankan government that the project management could prohibit the use of Sri Lanka's air space and block the country's aircraft from landing on its properties.
If we accept Rajapaksha's version of events then the primary objection of India to the project appears to be the possibility of China extending its control over Sri Lankan national space. India understandably objects to Chinese penetration so close to its neck of the wood.
Thus a new contract will be signed, devoid of all clauses which were unfavourable to Sri Lanka, with the megapolis and western development ministry and urban development authority (UDA), including new conditions replacing the ones in the original agreement, Rajapaksa told the cabinet.
The new agreement will be signed by the China Harbour Engineering Company Ltd (CHEC), a part of the China Communications and Constructions Company Ltd.
One of the contentious issues in the original agreement was that 20 hectares of land was to be granted as a freehold to the CHEC Port City (Pvt) Ltd, and the rest on a 99-year lease. However, the new government has decided to give it only under the 99-year lease, scrapping the freehold provision of the past agreement.
Moreover, the agreement now includes healthcare, exhibition and convention centres and the new Colombo International Financial Centre. There will be no restrictions on the development of the North and West ports of the Colombo Harbour. Also, the CIFC building will be set up in the land area reclaimed first, the project company has agreed. They just await a study to confirm that building on the reclaimed land is technically feasible, and that the terms are mutually acceptable.