“Sri Lanka-China-Hambantota debacle, may now be too big to fail. Hambantota has been the site of one of the most ambitious development plans in the world,’’ wrote Wade Shepard (author and travel writer since 1999) after spending several days in Hambantota. He added, “China has a history of sticking it out, and rarely cuts its [...]

The Sunday Times Sri Lanka

Hambantota port holds the key to Sri Lanka’s golden era


File picture of the Hambantota port.

“Sri Lanka-China-Hambantota debacle, may now be too big to fail. Hambantota has been the site of one of the most ambitious development plans in the world,’’ wrote Wade Shepard (author and travel writer since 1999) after spending several days in Hambantota.

He added, “China has a history of sticking it out, and rarely cuts its losses and run, especially when so much is at stake. For China it’s about Maritime Silk Route (MSR) and Hambantota is a core part of this”.

Wade is dead right, yet no port in the world has been criticised, more than Hambantota port and dubbed as the world’s biggest swimming pool, by some local politicians and as one of the pearls of China’s string of pearls, by Pentagon.

The Chinese Ambassador to Sri Lanka visited Hambantota recently and on his return to Colombo, had discussions with Prime Minister Ranil  Wickremesinghe. It was announced thereafter that Sri Lanka and China have formed a Joint Committee to revise and implement strategies to save the Hambantota project.

The main item on the agenda is to develop the Sri Lanka China industrial zone with 15000 acres allocated to China. Two important facts about Sri Lanka’s biggest economic development project ever are that the Hambantota project begins in Thailand, where the construction of Kra shipping canal that would revolutionise international maritime trade (as Panama canal did) has begun.

Secondly the Hambantota project as part of China’s MSR strategy is viewed with serious concern and unease by some regional and global powers. Some fear China’s strategy to dominate the Indian Ocean, others like Singapore and Malaysia fear the Kra canal could spell economic disaster to their countries. Singapore fears the loss of its status as the transhipment hub of Asia. The hub port mantle will then fall on Sri Lanka or Thai Kra port or both.

The US, China, India, Singapore, Malaysia Japan and Vietnam are currently engaged in manoeuvres to promote their interests post Kra canal. World media reports from Wall Street to Beijing, New Delhi to Singapore, Hanoi to Tokyo as well as the attention of UN bodies, provide a glimpse of global reactions to the Kra canal project.

China and kra canal project 

In March 2015, Chinese President Xi Jinping released details of the Kra canal project during BOAO FORUM. India’s Foreign Minister Sushma Swaraj told Chinese leaders in Beijing in 2015 that India will not give blanket endorsement to MSR. A Chinese Daily reported on July 4, 2016 that former Indian PM Manmohan Singh expressed support for the Kra canal project, but Indian Premier Narendra Modi changed India’s attitude. “India’s hedging strategy towards MSR has very military and strategic implications,” it was reported.

Lloyds List of 8 Sep 2016 reported that Thai leader General Prayuth Chan-ocha called the canal a very useful project with lots of benefits for Thailand.

If General Prayuth decides to act on the window of opportunity, all the nations in Asia will benefit.

China’s Defence adviser Prof. Jin Yinan in September 2016 told national radio that China should impose sanctions on Singapore to show its displeasure. Singapore by pushing South China issue as an international affair has provoked confrontation between China and US. Retaliation against Singapore is inevitable. Singapore is playing with fire.

The international media reports on the canal and China’s MSR initiative provides a glimpse of the turbulence for some and expectations of bright weather by others. Amidst all this Chinese Foreign Minister Wang Yie during his visit to Sri Lanka in July 2016 said, “China will align its MSR project with Sri Lanka’s plans to enable Sri Lanka to become the shipping hub of the Indian ocean’’.

My reading: Sri Lanka must begin preparations immediately to align the Hambantota port with Kra canal and replace Singapore, as the hub port of Asia.   It will not be easy; planning and implementing will take a long time. Singapore handles over 30000 ships per year compared with around 4000 ships by Colombo port. As mentioned earlier, Vietnam has already begun to construct a new port to serve ships on their new route to Kra canal.

Obama and Modi’s visits  to Vietnam 

Disturbed by Vietnam’s moves, US President Barrack Obama and PM Modi made unexpected visits to Vietnam. According to media reports: “Obama’s visit to Vietnam in May 2016 was ostensibly focussed on TPP. The visit in fact had a powerful subtext, China Vietnam South Sea dispute. All these theatrics could be a sideshow for the main Act – the Kra canal project. PM Modi visited Vietnam on his way to attend the G20 meeting in China. He offered a line of credit to buy arms from India. His mission too was to shift Vietnam’s focus away from China. The two missions failed and Vietnam’s PM went to Beijing soon after to canvass FDI to develop the economy. Vietnam, Japan and Thailand have much to gain from the canal, Singapore has just as much to lose Singapore despite the publicity of its high tech reputation, always relied on its position as Asia’s top transhipment port for its prosperity The port played a vital role in raising the city state from a sleepy trading post to a first class economy in one generation”.

It is through this maze of rivalry involving regional and global powers that Sri Lanka has to find its way to link Hambantota port with China and the hai Kra canal. This requires diplomatic skills of the type that late Shirley Amarasinghe (who presided over the Law of the Sea conference) and late Lakshman Kadirgamar, had. I would add, if Kadirgamar was Mahinda Rajapaksa’s Foreign Minister, China would have been diplomatically asked to pay the full cost of building the Hambantota port as China did in building all the ports of string of pearls in Pakistan, Bangladesh and Mayanmar or the Port City.

Kadirgamar would have recognised China wanted Hmbantota port more than Sri Lanka. China after spending $50 billion on the Kra canal project is not going to allow ships to go to Singaore. That calls for China to build a sparkling state- of- the- art port with the best port operations in the world in terms of technology and efficiency. It will have to be more efficient than Singapore. An oil trading hub with several oil refineries have to be built by attracting foreign owned companies in Singapore, to shift their operations to Hambantota. The world’s largest triple class ships of Maersk line will be able to use the canal. To attract such global leaders to Hambantota, large enough carrots will have to be dangled. Negotiations with all users of Singapore will have to start discreetly.

The mistake Mahinda Rajapaksa made was to build the port and then seek users. The admiralty courts eco system will have to be streamlined to enable efficient commercial dispute settlement as in Singapore.

The urgent need is for Sri Lanka to set up a high powered committee of professionals to prepare Hambantota to be the transhipment hub of Asia .

It is prudent for Sri Lanka to work towards a consensus among China, US and India and all others involved. The US may want to use the canal to move its sixth fleet from Diego Garcia to the Pacific. That would require permission from China which will control the canal for 50 years in terms of an agreement with Thailand.

The Kra canal has the potential to bridge the yawning gap between the two superpowers China and US. That would be the canal’s biggest contribution to the world, if not mankind.

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