East Terminal to go ahead with planned consortium
The government is planning on forming a company to run the East Container Terminal (ECT) when it becomes operational later this year, a decision that would be announced after the election.
Sources at the Sri Lanka Port Authority (SLPA) noted that authorities are currently trying to form a company and they will be going ahead with India and Japan in running the operations at the ECT.
It was noted that while discussions are on between local authorities with India and Japan, this announcement is likely to be made once the general elections conclude.
The ECT has been a controversial issue lately due to the involvement of key partners like India that appeared to be sidelined after China was given prominence over them in Sri Lankan ports. In addition, when the ECT was nearing completion the terminal was repeatedly held back from installing its gantry cranes. Now there seems to be a rush in commissioning the long overdue terminal in commencing operations, informed sources said.
Meanwhile three of the gantry cranes scheduled to be fitted for the Jaya Container Terminal (JCT) are to be used at the ECT. These cranes are likely to arrive by the end of this month and to be installed by the end of July.
Moreover, the ECT is planned to be commissioned by August this year, Additional Managing Director Upali De Soysa told the Business Times on Tuesday.
India and Japan had already made commitments in an MOU in 2018 with Sri Lanka to establish a joint consortium to run the ECT.
It is believed that the viability of the SLPA could improve under this partnership holding a larger minority stake of at least 40 per cent by capitalising the existing asset compared to the 15 per cent shares it obtained from CICT and SAGT.
Initial plans laid out in 2018 were to allow the governments of India and Japan identify strategic partners who will own a controlling stake in the Special Purpose Vehicle (SPV) that will lease the ECT and operate on a BOT basis for a 35-year period.
The Japanese government had in 2018 submitted an MOU stating that they were willing to provide equipment free of charge on the condition that it would be managed by a consortium comprised of Japan and India with SLPA as a minority stakeholder.
Mr. De Soysa noted that plans are also underway to commence work at the West Container Terminal (WCT) as well.
He said that even this terminal would be run as a Public Private Partnership (PPP) with prospects of going for open bidding and a minimum of 15 per cent to be held by SLPA and 85 per cent by an investor.
In this respect SLPA is hoping to call for Request for Proposals (RPFs) by the end of this week for the WCT.