On the second of February, the government scrapped the deal of developing the major port terminal with India and japan after the week-long protests by the opposition party and trade unions.
The Indian government has asked the Sri Lankan government to abide by their commitment to allowing Japan and India to develop the ECT of Colombo port. Previously the Sri Lankan government had agreed to develop a CET at the Colombo part in collaboration with Japan and India.
In this deal, India and Japan were going two own around 49 percent of the terminal shares, and the port authority of India will own the majority stake. But on the second of February, the Sri Lanka government declared that the east terminal is going to be a wholly-owned container terminal of the Sri Lanka ports authority.
The Colombo port trade unions opposed this proposal of 49 percent stake by India and Japan. They have demanded that the ECT have a 100% stake instead of the proposed 51 percent; around 23 trade unions have to oppose the deal.
The memorandum of trilateral arrangement for the project under the Maithripala Sirisena-Ranil Wickremesinghe govt (former) was signed by Sri Lanka, Japan, and India. Under this arrangement, the Sri Lankan port authority and the Sri Lankan govt PSU will share. The remaining share will be divided between India and Japan’s entities.
India’s reaction came after the prime minister of Sri Lanka, Mahinda Rajapaksa, tweeted wherein he assured that the local workers of the trade union that terminal is not going to be sold or leased to any foreign country/entity.