BEIJING: China has planned to build a port city near Colombo. Deputy Investment Promotion Minister of Sri lanka, Eran Wickramaratne, said that port city would be Sri Lanka’s biggest foreign funded investment.
Lawmakers failed to approve a 25-year tax holiday proposed by the previous administration for the Colombo Port City before a deadline and process must now be restarted if the project is to continue, he said.
“Within three months you have to get it approved in parliament,” Wickramaratne said in an interview on Wednesday. “Three months ended yesterday. They have to talk again.”
Sirisena’s government started an investigation into the project as it looks to increase transparency and rebalance ties away from China. The president this week visited India on his first overseas trip since he surprisingly ended Mahinda Rajapaksa’s decade-long rule in Jan. 8 elections.
Although the project will be delayed, it’s unlikely to be killed altogether, according to Bimanee Meepagala, an analyst at NDB Wealth Management Ltd. in Colombo.
“Sri Lanka can’t undermine the magnitude of the project and the sensitivity of the relationship with China,” she said.
Sirisena plans to travel to China in March, about a month before he’s due to call parliamentary polls. His first budget last month included populist measures such as a one-off windfall tax on company profits, and a failure to secure investment could hurt his chances of winning more seats.
