Sri Lanka: A strategic warzone between India and China

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The acquisition of the Hambantota port by China has spurred particular alarm in India, which is concerned about Beijing’s growing strategic and economic footprint in the Indian Ocean region.

Struggling to pay its debt to Chinese firms, the nation of Sri Lanka formally handed over the strategic port of Hambantota to China on a 99-year lease. As was the fact that Sri Lanka will also hand over 15,000 acres of land for a Chinese economic zone.

In recent years, China has shored up its presence in the Indian Ocean, investing billions of dollars to build port facilities and plan maritime trade routes as part of its “One Belt, One Road” initiative to help increase its market reach.

Along the way, smaller countries like Sri Lanka have found themselves owing debts they cannot pay. Sri Lanka owes more than $8 billion to state-controlled Chinese firms. This port deal was in return for China writing off a little over one billion dollars worth of Sri Lanka’s enormous bilateral debt to that country.

India is trying to do is to showcase how the Chinese way of infrastructure building — high-interest debt, overpricing and demands on the host country’s foreign policy — is little more than a modern neo-colonial enterprise.

Some 40 kilometers away from Hambantota port in southern Sri Lanka lies an airport that’s been dubbed the world’s emptiest. India, unruffled by the vacant terminals, is looking to snatch up the under-used complex to monitor Beijing’s growing presence in the country.

Hambantota is not the only strategically important infrastructure project to be completed with Chinese aid. Others include the Colombo container terminal expansion and the Colombo reclamation project overlooking Colombo port, a vital hub of India’s shipping.

China is now gaining not only a military advantage but also a commercial edge in South Asia. As per a TOI report, when the China-Sri Lanka free trade agreement (FTA) comes through, Chinese business will be capable of using India’s FTA with Sri Lanka to gain backdoor entry into Indian markets. China has sprung a surprise by signing an FTA with Maldives, a country till now dependent on India for almost everything.