Q Why is it in News?
Sri Lanka has decided to offer the West Container Terminal (WCT) to Indian and Japanese companies.
- The decision comes a month after the Sri Lanka government ejected the two partners from a 2019 tripartite agreement to jointly develop the East Container Terminal (ECT), citing resistance to “foreign involvement”.
- Sri Lanka has approved the proposal to develop the WCT on Build, Operate and Transfer (BOT) basis for a period of 35 years as a public-private partnership with India’s Adani Ports and Special Economic Zone Limited and its local representative in Sri Lanka.
Q What will be the stake of companies developing WCT?
- In the ECT project agreed upon earlier, the Sri Lanka Ports Authority (SLPA) was to hold a majority 51% stake, but in the WCT proposal, India and Japan will be accorded 85% stake.
- This is similar to the terms set for the Colombo International Container Terminal (CICT), where China Merchants Port Holdings Company Limited holds 85% stake.
Q What is significance of WCT?
- The WCT is adjacent to the China-run CICT and just a couple of kilometres away from the China-backed Port City being built on reclaimed land, making it a strategically desirable spot for India, whose concerns over China's presence in Sri Lanka are well known.
- It will support India in accomplishment of its strategic vision (SAGAR) for the Indian Ocean, ‘Neighbourhood First policy’, and in countering China’s String of Pearls strategy.
- Colombo’s alternative comes at a time when Sri Lanka is seeking support at the ongoing UN Human Right Council session, where a resolution on the country's rights record will soon be put to vote.
