By P.K.Balachandran
Colombo, August 26 (Counterpoint): Santosh Jha, who is tipped to be India’s envoy in Sri Lanka in place of the incumbent Gopal Baglay, is likely to vigorously pursue India’s economic goals in Sri Lanka, given his strong background in economic diplomacy.
Jha was Counsellor at the Indian High Commission in Colombo in charge of economic affairs, during the reconstruction of war-devastated Northern Sri Lanka after the cessation of hostilities in 2009. He was also involved in the negotiations to enter into a Comprehensive Economic Partnership Agreement (CEPA) with Sri Lanka. As Ambassador to the European Union in Brussels, he was part of the negotiations for an India-EU Bilateral Trade and Investment Agreement.
Given India’s ongoing deep involvement in Sri Lanka’s economic recovery from a crippling foreign exchange crisis with a financial package of US$ 4.5 billion, Jha will be implementing India-Lanka agreements on a wide range of high-value infrastructure and energy projects agreed upon during Lankan President Ranil Wickremesinghe’s State Visit to India in July.
Complicating the scenario, the projects proposed in the “Vision Statement” issued at the end of Wickremesinghe’s visit, are to be implemented in the face of stiff competition from China.
Beijing is also wooing Sri Lanka vigorously, for more projects for itself though, in contrast to India’s generosity, it is still dragging its feet on debt restructuring or extending emergency financial aid to help Sri Lanka overcome the forex crisis.
Onerous Task
Jha will have a tall order to meet in Sri Lanka as the “Vision Statement” issued by Indian Prime Minister Narendra Modi and Sri Lankan President Ranil Wickremesinghe in New Delhi on July 21, is ambitious.
Here are some of the key infrastructure projects envisaged:
- Development of ports and logistics infrastructure at Colombo, Trincomalee and Kankesanthurai;
- Exploration of “land connectivity” between India, and the ports of Colombo and Trincomalee with a bridge across the Palk Strait;
- Cooperation in developing renewable energy enabling Sri Lanka to achieve its target of generating 70% of power requirements from renewable energy sources by 2030;
- Establishing a high-capacity power grid interconnection between India and Sri Lanka to enable bidirectional electricity trade between Sri Lanka and other regional countries, including the BBIN countries comprising Bangladesh, Bhutan, India, Nepal, which has the potential to not only bring down the costs of electricity in Sri Lanka but also help create a valuable and dependable source of foreign exchange for it;
- Expediting implementation of understanding reached on Sampur Solar power project and LNG infrastructure,
- Cooperation in green hydrogen and green ammonia through use of innovative technologies with an aim to increase renewable energy mix in power generation of Sri Lanka;
- Developing the Trincomalee Tank Farms and other developmental projects in the Trincomalee area;
- Constructing a multi-product petroleum pipeline from the Southern part of India to Sri Lanka with an aim to ensure affordable and reliable supply of energy resources to Sri Lanka; to undertake mutually agreed joint exploration and production of hydrocarbons in Sri Lanka’s offshore basins with an aim to develop Sri Lanka’s upstream petroleum sector;
- Facilitate investments from India in the divestment of Sri Lankan State-owned Enterprises and in manufacturing/economic zones in various sectors in Sri Lanka;
- Hold discussions on an Economic and Technology Cooperation Agreement (ECTA) with an aim to comprehensively enhance bilateral trade and investments in new and priority areas;
- Implement the decision to make the Indian Rupee a currency for trade settlements between the two countries;
- Operationalising an UPI-based digital payments for further enhancing trade and transactions between businesses and common people;
Leveraging India’s Digital Public Infrastructure in accordance with Sri Lanka’s requirements and priorities towards effective and efficient delivery of citizen-centric services to the people of Sri Lanka.
Geopolitical Issues
Complicating the scenario, these projects have to be implemented in a challenging geopolitical context, namely, in the face of stiff competition from China. Beijing is also wooing Sri Lanka vigorously, for more projects for itself though, in contrast to India’s generosity, it is still dragging its feet on debt restructuring or extending emergency financial aid to help Sri Lanka overcome the forex crisis.
Jha will be involved in countering China’s powerful geopolitical influence in Sri Lanka and seeing that Sri Lanka remains irrevocably within India’s sphere of influence.
This is a no-mean task, given Sri Lanka’s tendency to dodge India in both economic and geopolitical matters. As Hindustan Times says, Sri Lanka is “yet to respond positively to India’s strategic concerns vis-à-vis China and has hosted Chinese surveillance ships and ballistic missile tracking ships in Colombo and Hambantota.”
According Sunday Morning, Sri Lanka is working on a Standard Operating Procedure (SOP) for foreign military ships wanting to call at Si Lankan ports. According to it, relevant Sri Lankan officials will board the vessels to ensure that nothing is done to jeopardise India’s security.
And again in the context of China’s geopolitical challenge to India, Indian Defence Minister Rajnath Singh is to visit Trincomalee according to Daily Mirror shortly.
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