Colombo, April 26 (www.bdnews24.com): India and Sri Lanka on Wednesday signed a
Memorandum of Understanding (MoU) on “Cooperation in Economic
Projects” during the on-going visit of the Sri Lankan Prime Minister
Ranil Wickremesinghe to India. The MoU envisages joint ventures in several areas of development.
Wickremesinghe and his Indian counterpart, Narendra Modi, welcomed the
signing of the MoU and expressed satisfaction over the implementation
of projects already agreed upon. They hoped that the various projects
mentioned in the MoU would also be executed expeditiously.
Though the draft of the MoU signed on Wednesday was approved by the
Sri Lankan cabinet, it became controversial with petroleum sector
trade unions going on a crippling strike on Monday, a day before the
departure of Wickemesinghe to India.
Indian officials regretted that the Sri Lankan public were not made
aware of the fact that the projects are “Joint Ventures” between
Indian and Sri Lankan government entities and are not outright sales
to Indian entities.
Trincomalee Oil Tanks Issue
For example, the proposed deal between India and Sri Lanka on the
management of the 99 oil tanks in Trincomalee, envisages a Joint
Venture between the state-owned Indian company Lanka Indian Oil
Corporation (IOC) and the Sri Lankan public sector entity, Ceylon
Petroleum Cooperation (CPC). But the agitation against the deal was
based on the wrong notion that the tanks were to be given away
wholesale to India on a throw away fee of US$100,000 per annum.
The Mithripala Sirisena-Ranil Wickremesinghe government did not think
it was necessary to correct this impression. In fact, to get the
unions to call off the crippling strike, the Prime Minister assured
that he will not sign any agreement on the tanks during his four-day
visit to India beginning on April 25.
However, the areas for cooperation envisaged in the MoU signed in Delhi are:
A Liquefied Natural Gas (LNG) fired 500 Megawatts capacity LNG Power
Plant as well as LNG Terminal/Floating Storage Re-gasification Unit
(FSRU) in Kerawalapitiya. India will assist Sri Lanka in the enhanced
use of Natural Gas, including the setting up of a piped gas
distribution system in Colombo and in suburban areas in Sri Lanka;
help set up retail outlets for the supply of Compressed Natural Gas
(CNG) to the transportation sector in Sri Lanka; and convert
fuel-based power plants to LNG power plants. All this will be done
jointly with the Ceylon Petroleum Corporation (CPC).
India will set up a 50 MW (extendable to 100 MW) Solar Power Plant in
Sampur; form a Joint Venture to develop the 84 oil tanks in the Upper
Tank Farm in Trincomalee, and sign a land lease agreement for 50 years
in favor of the Lanka Indian Oil Corporation (LIOC) Ltd. India will
also make joint investments in the development of ports, a petroleum
refinery and other industries in Trincomalee.
India will set up Industrial Zones or Special Economic Zones in
identified locations in Sri Lanka. It will also develop the
Dambulla-Trincomalee road as an Expressway through joint investments
with Sri Lanka. The development of the Mannar-Jaffna and Mannar-
Trincomalee highways is also on the cards.
India will help develop the railway sector in Sri Lanka through
projects relating to track upgrading and the purchase of rolling
stock. India and Sri Lanka will encourage Indian companies to invest
in a container terminal in Colombo Port (the Eastern Terminal),
considering that 70% of the Colombo port’ business is Indian
Ethnic and Fishing Issues
Prime Ministers Modi and Wickremesinghe touched on two other
controversial issues. Modi requested his counterpart to see that Sri
Lanka deals with Tamil Nadu fishermen who stray into Sri Lankan waters
in the Palk Bay in a humanitarian way. In turn he explained to
Wickremesinghe the steps taken by India to wean Tamil Nadu fishermen
men away from shallow water fishing and get them to do deep sea
Modi congratulated Sri Lanka for co-sponsoring the resolution on the
human rights situation in his country at the last session of the UN
Human Rights Council and hoped that the commitments made therein will
be met in the given time period of two years.