In the backdrop of India’s interest in leasing out an airport in China-dominated Hambantota, Sri Lankan Prime Minister Ranil Wickremasinghe will be in New Delhi this week for talks with Prime Minister Narendra Modi.
Wickremasinghe arrives in New Delhi on Tuesday and will speak at a key cybersecurity conference before meeting the Indian leadership. Sri Lanka has become an important partner for India both in the neighbourhood and in the Indian Ocean region. In addition, India is reportedly using Colombo’s influence over Myanmar’s Buddhist leadership to help defuse the Rohingya crisis.
India has expressed interest in operating the Mattala international airport near the Hambantota port terminal for which China recently announced it would pay Sri Lanka $1.1 billion for the Hambantota port’s terminals, which may ease some of the debt Colombo has taken but will mean a virtually permanent Chinese ownership of their real estate. China’s ambassador to Sri Lanka, Yi Xianlang, recently said that Chinese firms would invest $5 billion into SEZ near the port.
India opted to lease the Mattala airport for 40 years at something over $200 million — the trouble is, the airport is actually in the middle of nowhere, and is jokingly described as the world’s “emptiest” airport.
India wants to operate the airport for its own airlines, which have apparently reported an uptick in tourist travels to southern Sri Lanka. Second, there is also some vague plan of using it as a training space or even as a freight hub. But it will give India eyes on Hambantota so, from a security/strategic point of view, the leasing makes sense.
China is not pleased. Calling for cooperation between China and India in Sri Lanka, the official Global Times observed last week, “The airport in Hambantota had reportedly lost about $113 million as of the end of 2016.
It will not be easy for India to bring the airport to life and then use it to create jobs and generate tax revenues for the local economy. A quick deal to buy an existing airport, instead of focusing on greenfield manufacturing investment that can generate sustained income, is a shortcut to increasing New Delhi’s presence in Sri Lanka to counter China’s influence, but the local economy can hardly benefit from a deal like that.”
Source: Times of India