India Sri Lanka Relations:
After strong opposition from trade unions across the country, Sri Lanka has unilaterally pulled out of a 2019 agreement with India and Japan for developing the strategic East Container Terminal (ECT) at the Colombo Port.
- In 2019, India and Sri Lanka signed a memorandum of understanding for “co-operation on economic projects”.
- The MoU did not mention the Eastern Container Terminal, but India and Sri Lanka had already been in discussion for its development and operation.
- Although India and Sri Lanka have seemingly friendly ties and much cultural affinity and people-to-people contact, the relationship is complex.
- The majority Sinhala-Buddhist public opinion is layered with the memory of Indian intervention in the ethnic conflict.
- Thus, unlike Chinese projects, big projects by India have always faced opposition in Sri Lanka.
- For India, the ECT deal was important as between 60 and 70 per cent of transhipment that takes place through it is India-linked.
- The ECT is also considered more strategic than any other in Colombo Port. It is located next to the Colombo International Container Terminal (CICT) project, a joint venture between China Merchants Port Holdings Company Ltd. and SLPA.