Home / Front Page/ SL, India and Japan sign MoC to develop ECT

SL, India and Japan sign MoC to develop ECT


Comments / {{hitsCtrl.values.hits}} Views / Wednesday, 29 May 2019 01:50


 

Ports and Shipping Minister Sagala Ratnayaka signs the Memorandum of Cooperation (MoC) for the development of the East Container Terminal, flanked by Japanese Ambassador Akira Sugiyama (left) and Indian Ambassador Taranjit Singh Sandhu, at the signing ceremony yesterday

 

  • Terminal Operations Company to conduct ETC operations 
  • SL retains 51% stake, rest to be divvied up by India and Japan 
  • Japan to fund project with 40-year loan at concessionary interest rate 
  • Cabinet gives approval but will appoint committee to negotiate details
  • Govt. says inclusion of India crucial given transshipment volumes  

     

Sri Lanka, India and Japan yesterday signed a Memorandum of Cooperation (MoC) for the development of the long awaited East Container Terminal in the Colombo harbour. 

Under the MoC among the three governments on the development of the East Container Terminal, the Sri Lanka Ports Authority (SLPA) retains 100% ownership of East Container Terminal (ECT). 

The Terminal Operations Company (TOC) conducting all East Container Terminal operations is jointly owned; Sri Lanka retains a 51% stake, and the joint venture partners purchase a 49% stake, a statement by the Ports and Shipping Ministry said. A 40-year loan at an interest rate of 0.1% is expected from Japan to fund the project.   

“The envisaged Japanese loan carries one of the best loan terms Sri Lanka has obtained. The 51% stake is also one of the best in SLPA joint ownership endeavours. SLPA’s majority ownership in the new TOC represents a significant step in prioritising national interests,” the statement said.

The three governments will work out details based on the MoC at joint working group meetings, and advance their cooperation towards early commencement of work and operation of the ECT.

“As a hub of the Indian Ocean, the development of Sri Lanka and openness of its ports are of great importance. Colombo Port is the leading Port in the region. This joint project reflects the longstanding good will and cooperation among the three countries.”  

Japan has provided cooperation for the development of the Jaya Container Terminal since the 1980’s. Around 70% of Colombo Port’s transshipment business is India-related. Sri Lanka, Japan and India will work together for further development of the Colombo Port and contribute to further regional prosperity and stability of global trading networks, the statement said. 

Primary Industries and Social Empowerment Minister Daya Gamage, addressing a press conference at the Government Information Department on Tuesday, denied that the Government had inked the MoC with India to offset growing Chinese influence in Sri Lanka. The Government of Opposition Leader Mahinda Rajapaksa had earlier given two terminals of the Colombo Port to China’s CM Ports, while the current administration handed over the Hambantota port to the same company in a joint venture in 2017. 

“India is scared with China coming in as they are becoming a threat to them. But we have not signed any defence agreements with China,” Gamage told reporters. 

Justifying the venture, Gamage said: “We don’t have money to develop this, as we will have to buy all the equipment and you cannot fight with India either. Out of all our exports, 80% is Indian transshipment, India joining us in this is a huge strength for us, because if they start another port in India we will lose a lot of our business. So this is a good arrangement for Sri Lanka because it will get 51% ownership without investing anything.” 

Minister Gamage said the terminal venture had been discussed extensively at the Cabinet meeting held on Tuesday, and consent was given by the members.   

“Everyone in the Cabinet has given consent, but Cabinet will appoint a Committee on certain matters as we need certain clarifications, such as what are the companies coming in, how the profit margin is going to be set up as well as other details. There are certain other procedures to be followed,” he said. 

“The two countries will have to negotiate their ownership portions.”  

 

CASA optimistic about new deal for ECT, welcomes port expansion


Share This Article

Facebook Twitter


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

A 4D presidential ‘laugh-a-thon’ that’s not on

Thursday, 24 October 2019

A funny thing happened on the way to the forum. Where once we had a paucity of presidential candidates, we now have a superfluity of them. You would think that from this panoply of contenders who’ve thrown their hat in the ring, we’d be spoilt fo


Forgotten tranquil train journeys in Sri Lankan landscapes

Thursday, 24 October 2019

Railway transportation is considered as the multifaceted economic booster in the world. Switzerland is the role model in utilising railways in envisaging the above concept. The Nuwara Eliya railway line was an exclusion for tourism and freight. Back


Zero waste: a wish come true?

Thursday, 24 October 2019

Zero Waste is a concept, which focuses on waste prevention where essentially resource life cycles are redesigned in such a way that all products are used and no waste is created. It is well-aligned with a circular economy approach, which facilitates


Sri Lanka’s obsession with plastic bags

Thursday, 24 October 2019

At a time where the world expresses growing concerns about climate change, Sri Lanka is still oblivious to the impact of single-use plastic on the environment, marine biodiversity and humans. Ignorance may be bliss in some instances but, not when we


Columnists More