Key Highlights of the agreement:
- Location: The ECT is located some 3 km away from the China-backed international financial city, known popularly as “port city”, being built on reclaimed land on Colombo’s sea front.
- Ownership:
- The Sri Lanka Ports Authority (SLPA) retains 100% ownership of the East Container Terminal (ECT).
- The Terminal Operations Company, conducting its operations, is jointly owned. Sri Lanka will hold a 51 % stake in the project and the joint venture partners will retain 49%.
- Cost: The joint initiative is estimated to cost between $500 million and $700 million.
- Japan is likely to provide a 40-year soft loan with a 0.1 % interest rate.
- Details of India’s contribution to the initiative are awaited.
- Significance of the project for India: Over 70 % of the transhipment business at the strategically located ECT is linked to India.
- Way Ahead: The specific terms of the agreement to jointly develop the ECT will soon be finalised at a joint working group meeting.
