China port caught in Lanka cross-currents

China Galle Face -portHard hat firmly perched on his head, Chinese contractor Wu Chaoxiang shrugged when asked if the rumble of trucks carrying rocks towards yellow cranes and red metallic towers on reclaimed land along the beach just outside Colombo would stop with the change in regime here.

“I’ve been told to keep going,” Wu said, in Pidgin English. “My bosses say the project is on. But I also know some people are saying we may have to stop.”

The “project” – a $1.4 billion China-financed New Colombo Port City – is the largest-ever foreign investment in the country. It was pitched to Sri Lankans by the government of ousted President Mahinda Rajapaksa as a boost to the country’s economic development, a jewel that would come encrusted with a Formula One strip right by the ocean.

But the township today reflects the deep divides that culminated in Rajapaksa’s loss, and has emerged – to New Delhi and Beijing – a key test of which among them the new Sri Lankan government of Maithripala Sirisena will lean towards.

In December, then Opposition leader and now Prime Minister Ranil Wickramasinghe had threatened to scrap the project, which effectively gives China 20 hectares of the reclaimed land in perpetuity, and another 88 acres on a 99-year lease.

Now, some of the new government’s advisers are recognising that scrapping the project altogether will not be easy – and are arguing that it may not be advisable for Sri Lanka.

But India will not easily give up on its concerns regarding a project that New Delhi views as a critical component of Chinese President Xi Jinping’s proposed Maritime Silk Route – a new, Beijing-dominated sea trade corridor.

“This isn’t just an economic project,” an Indian diplomat closely involved in New Delhi’s relations with Colombo told The Telegraph. “This project has deep security implications for us.”

China – through either ownership or on lease – will control 108 hectares out of the total 233 hectares of land that will be reclaimed, an area just larger than the size of the city-state of Monaco.

That control, combined with the money Beijing is spending on building the new port city will, India fears, give China access to the details of every ship that will dock there. Over 70 per cent of Indian ships visiting Sri Lanka depend on Colombo port, and if operations shift to the new port – as is the plan – little of Indian maritime trade with Sri Lanka will remain unknown to the Chinese.

India is also concerned about two recent dockings by Chinese submarines at Colombo port, and articulated its concerns to Sri Lanka. But in September, when Xi Jinping visited Colombo – the first Chinese head of state in three decades to make the trip – Rajapaksa hurriedly inked a clutch of pacts and the two leaders jointly inaugurated the construction of the new port.

“Even members of Sri Lanka’s own external affairs ministry have indicated to us that those agreements were signed in a rush, that they didn’t have enough time to even go through them properly,” the diplomat said.

Domestically in Sri Lanka too, the new port project has for many transformed into an example of the Chinese influence in the country that has separately also fuelled allegations of corruption against the Rajapaksa regime.

The Rajapaksa government agreed to let China build an expressway between the port city of Galle and the town of Matara, famous as the home of cricketer Sanath Jayasuriya, along the country’s southern coast at a price tag of $8 million per kilometre.

Even as that cost triggered criticism, the Rajapaksa government took fresh loans from China to extend the highway, the new stretch costing the Sri Lankan exchequer a whopping $11 million per kilometre for a 30km stretch, and inviting allegations of kickbacks.

During their election campaign, Wickramasinghe and Sirisena also cited Sri Lanka’s heavy economic dependence on China under Rajapaksa to sow fear that the country was losing the independence it won after colonisation by the Dutch and then the British.

“This credit money received from abroad goes to a few individuals,” Sirisena’s manifesto said. “Generations of our children and grandchildren will not be able to completely finish paying off this debt. If this trend continues for another six years, our country would again become a colony and we would be slaves.”

Those are fears that don’t sit lightly with Sri Lankans.

On Galle Face Road, the highway that runs from Colombo down the coast towards Galle, a series of colonial-era brass cannons still stand pointing out to the sea, a reminder of past maritime defences against fresh invaders.

The land reclaimed for the new port city that critics are citing as an example of China’s neo-colonialism ironically stands just next to some of these cannons.

But already, voices in the new government are suggesting caution and prudence over any hasty decision against the project.

Two senior Sri Lankan ministers in the new government – finance minister Ravi Karunanayake and deputy minister for investments Eran Wickramaratne – did not respond to specific queries from this correspondent on whether the administration would stick to its pre-election stance.

But a senior law officer in the government said the Sirisena regime would be “ill-advised” to implement Wickramasinghe’s threat.

“There are things that are said in campaigning, but when you’re in government you have to look at all consequences of your actions,” the law officer said, speaking on condition of anonymity.

Scrapping the project could invite litigation from China, could cost the Sri Lankan exchequer a heavy fine, and could hurt overall investor confidence in the new government in Colombo, the officer said.

If China were to withdraw from other projects in Sri Lanka in response, that would bring hundreds of millions worth of infrastructure initiatives to a grinding halt.

China, in its initial response to the Sirisena victory, harped on the “old ties” between the nations – pointing out that its strong relationship with Sri Lanka did not begin with Rajapaksa.

Beijing is correct. In the heart of Colombo’s legal district, hiding behind tall trees, stands Sri Lanka’s Supreme Court complex, shaped like a pagoda, and built with a Chinese grant rooted in talks that preceded Rajapaksa.

Finally, China offers Sri Lanka something India simply cannot – a veto on any move at the United Nations Security Council by the West against Colombo on allegations of human rights violations.

The Sirisena government has made it clear that its position on the UN allegations of war crimes against Sri Lankan forces remains the same as that of Rajapaksa, and China’s consistent support to Colombo at international platforms contrasts with India’s ambivalence. Unlike China, which has voted against every UN resolution against Sri Lanka, India has either voted in support or at best abstained from voting.

The next key vote on Sri Lanka’s human rights record at the UN is scheduled in March. Whether Wu’s trucks and cranes are allowed to continue their work outside Colombo could influence how India and China vote there. (Telegraph)

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