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Indian Foreign Secretary to meet Sri Lankan leaders on Monday

(UDHAYAM, COLOMBO) – Indian Foreign Secretary S. Jaishankar will be meeting Sri Lankan President Maithripala Sirisena, Prime Minister Ranil Wickremesinghe and other Sri Lankan leaders during a brief visit to the island on Monday.

Officials described Jaishankar’s visit as a routine one to keep him abreast of the latest developments in the island nation, besides keeping track of the progress of existing Indian development projects, and to explore possibilities of future engagement in the development and commercial sectors. Jaishankar will also explore possibilities for the Indian private sector investment.

One of the issues which are likely to crop up in the discussions is the uncertainty which has crept into the Lanka Indian Oil Corporation’s (LIOC’s) hold on the oil tanks in Trincomalee.

The Maithripala Sirisena-Ranil Wickremesinghe government has indicated its interest in taking over 3-30 oil tanks for use during the expected power shortage due to drought. But the LIOC states that these tanks cannot be arrogated unilaterally as the LIOC had got the tanks through a government-to-government agreement in 2003. The LIOC further stated that if the Ceylon Petroleum Corporation wants some tanks to be refurbished and used, the LIOC could help them do it.

Meanwhile, the parliamentary Committee on Public Enterprises (COPE) went a step further and accused the LIOC of not entering into a Lease Agreement and paying the rental regularly. The LIOC contends that because the tanks were transferred to the LIOC by a government-to-government agreement, no lease agreement was required and that the annual fee of US$ 100,000 is being paid regularly.

At any rate, any further development of the tanks will have to await the decision of the governments of Sri Lanka and India. However, the issue, which was hot not so long ago, has cooled down now.

The Indian Foreign Secretary would also like to know the prospect of the Indian Railways getting further contracts to build rail networks in Sri Lanka. India has earmarked US$ 468 million for this and is awaiting Colombo to seek bids. But there has been little movement from the Sri Lankan side in this matter so far.

Following President Sirisena’s request to Indian Prime Minister Narendra Modi, the long-standing Indian project to build a 500 MW coal fired power plant in Sampur was given up, and India agreed to put up a 500 MW LNG-fired power plant in Kerewelapitiya. But in this matter too, there has been no further movement from the Sri Lankan side.

Meanwhile, there is talk in Sri Lankan government circles about developing Trincomalee port with an economic zone around it. The Sri Lankan government is keen on getting India, Singapore and Japan into drafting schemes for this to counter balance China which has been given control of the Hambantota port.

Here again, there has been no progress though it is said that a Singapore firm Surbana Jurong is doing a feasibility study of hinterland development. There is still no clarity about plans to develop Trincomalee port as such. Indian officials said that while India is not pushing for a role in Trincomalee port development, it might be interested if Sri Lanka comes up with a request and a concrete plan. And Trincomalee may not cost as much as Hambantota port (US$ 1.5 billion) as it is a natural harbour.

Two Indian companies were to head a consortium of companies to build the Third Container Terminal in Colombo, but suddenly the government decided to tweak the bid requirement to meet legal requirements. Meanwhile, it is learnt that further development of Colombo port has been stalled to enable Hambantota port to rake in some much-needed business.

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