Sri Lanka wants India’s Help to Pay China’s Debt

WHAT SRI LANKAN PM SAID IN AN INTERVIEW TO THE HINDU

We didn’t discussed the Trinco projects, but we did talks about the Eastern Terminal [in Colombo] which India and Japan are jointly investing in, and the LNG terminal.

Whatever was signed [in 2017] was not even pursued by the last government. President [MRS Sirisena] actually rejected all the projects PM [Wickremesinghe] had signed. We are not responsible for those projects. The Mattala [airport] project is also out. Our government has a firm policy on not allowing any national resources to be given to foreign control. – Sri Lankan Prime Minister


SOME BAD NEWS FOR INDIA

In their talks, India also pushed the Sri Lankan side to expedite clearances for two big infrastructure projects that India is undertaking – the Mattala airport in Hambantota and the Eastern Container Terminal off Colombo which India is developing together with Japan.

The Rajapaksa government earlier had leant heavily towards China and given the Hambantota port to them.

In the intervening years, India has managed to get development rights to Mattala airport, close to the Hambantota port and the ECT.

MATTALA AIRPORT

US$209 million were spent on the project, with $190 million provided by the Chinese government via the Exim Bank of China.

INDIA WAS INTERESTED IN BUYING MATTALA AIRPORT

SET BACK FOR INDIA

According to Sri Lankan PM – India will not be getting the Mattala Airport as Sri Lanka is opposed to selling “national assets”

BUT SRI LANKA REQUESTED INDIA’S HELP IN ANOTHER WAY

Sri Lanka is currently facing a mammoth challenge in the form of domestic and foreign debt of US $60 billion, under which the Sri Lankan economy is currently reeling.

$5 billion payment per year

SRI LANKA WANTS INIDAN HELP

Last year, Gotabaya Rajapaksa had visited India in his first official visit to any country after getting elected as  Sri Lanka’s President.

New Delhi had then extended a US $450 million in soft loan to Sri Lanka

WHAT SRI LANKAN PM SAD NOW IN FEB 2020

This is something we discussed with the Indian government as well, and have asked if we could get a moratorium on all loan repayments for three years, until we can revive the economy.

If the Indian government takes this step, then other governments might agree to do the same thing, including China.

The previous government took so many loans, they beggared the economy, and it is a mess. It all depends on the stand India takes.

SOME HOPES ON HAMBANTOTA PORT

Sri Lankan Prime Minister did say that Sri Lanka wants Hambantota Port back from China and they will raise this issue when the Sri Lankan PM visit China

LARGER QUESTION – SHOULD INIDA BAIL OUT SRI LANKA?

India helped Maldives to manage its Debt in 2019

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