Sri Lanka plans to develop Trincomalee port as an industrial hub
Indian Express: Sri Lanka’s announcement that it plans to develop Trincomalee as an “industrial harbour” and will soon float tenders for this could see the economically beleaguered nation put up a couple of thousand hectares of land on lease to set up industries in a special economic zone and the associated development of the strategically located port, stirring up geopolitical interest in that part of the Indian Ocean.
“We are actually planning to go for an Expression of Interest (EoI)to develop Trincomalee Port as an industrial port. That means we will be asking from not only one party, but from any industrialist who wants to come and utilise the port premises. We have large land, some 2,400 hectares, that surrounds the port of Trincomalee,” Sri Lanka Ports Authority (SLPA) Chairman Prasantha Jayamanna said on Tuesday (31 May).
Jayamanna was speaking to representatives of shipping companies and port workers’ unions to allay concerns about the slowing down of loading and offloading operations at Colombo Port – a major regional transhipment hub – due to a foreign exchange shortage that has resulted in fuel scarcity and affected supply chains.
The proposal to develop an industrial harbour in Trincomalee is a long-standing plan to monetise land that belongs to the SLPA, by getting foreign and local investment for a special economic zone, an industrial park, or an energy hub.
This would also entail the development of the port for non-containerised cargo traffic, such as cement, coal, or other industrial raw material.
“We are planning to call for EoIs soon. We had planned to do this in April, but delayed it till the situation (improved), because we expect a lot of local industries to also come and invest in the port,” Jayamanna said.
Jayamanna had made similar remarks in January this year. It is unclear when the SLPA will act on its intentions. India, which has already made a substantial investment in Trincomalee, is likely to be interested in the proposal both as a commercial project and as a strategic investment, a source in Sri Lanka said.
Earlier this year, Lanka Indian Oil Company (Lanka IOC), a subsidiary of Indian Oil Company (IOC), and Ceylon Petroleum Corporation (CPC) signed an agreement to develop a massive oil storage tank farm built during British rule at Trincomalee. The oil storage facility is located at the harbour and has its own jetty. The two entities have formed a special purpose joint venture called Trinco Petroleum Terminals Ltd. for the development of 85 tanks – all in decrepit condition.
OSL take:
Sri Lanka’s geographical positioning in the Indian Ocean and the many trade agreements as well as concessions enjoyed by the country has helped Sri Lanka work towards becoming an emerging business destination in the South Asian region. These have also attributed to the expansion in business/investment opportunities in Sri Lanka’s maritime industry. It is in this backdrop that the local authorities are looking at developing the Trincomalee Port as an industrial hub. Given the overall economic expansion in the country’s ports, shipping and logistics sectors and the steady growth in the maritime industry, foreign businesses/investors could confidently explore the opportunities in Sri Lanka’s maritime industry. Foreign businesses could also look at forming partnerships or joint ventures with local maritime businesses.
| Article Code : | VBS/AT/17062022/Z_2 |