India to finalise private partner for ECT
The commencement of the controversial East Container Terminal (ECT) is being pushed forward even as India is currently picking a private partner to run the operations.
It is learnt that India is engaged in identifying a private partner as per the terms of the agreement in the Memorandum of Cooperation (MOC) entered into in 2018 to manage the operations of the terminal.
In this respect if they are to finalise the private partner as identified they need to obtain the concurrence of the Sri Lankan authorities as well, informed sources said.
The terminal has been unused for a number of years and a subject of much controversy as port unions oppose its involvement with any outside partner. In addition as a partner of the Colombo South Harbour project, the Asian Development Bank (ADB) entered into an agreement with authorities to ensure that the Sri Lanka Ports Authority (SLPA) run the terminal but the subsequent establishment of the West Container Terminal (WCT) will be a public private partnership.
The ECT is vital to the SLPA and Port of Colombo due to its 18 metre draft that would enable ultra large vessels to berth and allow the port to generate higher revenues without sharing profits with other partners.
However, in 2018 authorities engaged India and Japan to form a consortium to run the operations of the ECT with a 49 per cent minority stake in the terminal leaving 51 per cent for the SLPA.
Industry officials say that India coming into the venture is plausible as at least 70 per cent of the transhipment volumes that come to the Colombo Port is for India. Sri Lanka is said to stand to gain from installing cranes purchased with a loan obtained from Japan for a period of 40 years at 0.1 per cent.
The said cranes never arrived but authorities are now mulling installing three cranes purchased for the Jaya Container Terminal (JCT) at the ECT. These cranes arrived on June 20 and this is now opposed by the port unions that carried out a protest on Thursday at noon blocking the roads during that time. SLPA Chairman Gen. Daya Ratnayaka said that the cranes ordered for JCT 5 had arrived and that for the last two to three months they were trying to find a solution to this issue.
“Now we have already analysed it and taken into consideration and the best thing will be done,” he said adding that they were also reconsidering the arrangement entered into with India and Japan as well.
India has continuously insisted that among other projects assisted by the subcontinent the ECT needs to be considered a priority. This was conveyed during a meeting with President Gotabaya Rajapakse and Indian Prime Minister Narendra Modi in New Delhi last year and then again during their recent discussions held over the telephone on May 23.