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Man behind Mundra set to develop Sri Lanka container terminal

INDIA's Adani Group, whose private Port of Mundra has challenged the box handling supremacy of Mumbai's Jawaharlal Nehru Port Trust (JNPT), is now the front-runner to develop the stalled East Container Terminal in Colombo, reports Bloomberg

05 November 2020 - 19:00

INDIA's Adani Group, whose private Port of Mundra has challenged the box handling supremacy of Mumbai's Jawaharlal Nehru Port Trust (JNPT), is now the front-runner to develop the stalled East Container Terminal in Colombo, reports Bloomberg.

Adani Ports and Special Economic Zone and a local partner received an in-principle approval to sign a deal with Sri Lanka Ports Authority, which will hold majority stake in the project, sources said.



Neither billionaire Gautam Adani nor India's foreign ministry would comment on the development. Nonetheless, it was reported that Adani, India's biggest ports and logistics company, had signed a preliminary agreement for the project last year.



Work on reviving the project, being jointly developed by Sri Lanka, India and Japan, comes at a time of rising regional tensions with China. Both India and Japan are members of the informal Quad grouping that along with US and Australia is seen as a counter to Beijing's influence in the Indo-Pacific region.



In July, India extended a US$400 million currency swap facility to Colombo to assist with post-Covid economic recovery. The two countries also discussed deferring of debt repayment during Prime Minister Mahinda Rajapaksa's first high-level virtual meeting since his re-election with India's Narendra Modi in September.



Sri Lanka, which emerged from a three-decade civil war in 2009, was known for taking Chinese loans to fund vast infrastructure projects, including ports and highways, that eventually became part of Beijing's Belt and Road Initiative.



Its appetite for Chinese cash waned after rising debt forced it to sell the Hambantota port back to China Merchants Port Holdings.



Meanwhile, the country's port authority last week started operations at parts of the East Container Terminal that it has already built, said chairman Daya Ratnayake.



The agreement signed between Sri Lanka's former government with India and Japan 'is still on,' he said. The Sri Lankan government 'is in discussions on how to operationalise it.'


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