India's Much-Needed Moves To Counter China Influence In Sri Lanka

India provided about $4 billion in rapid assistance between January and July, including credit lines

When Sri Lanka slid into its worst economic crisis in seven decades leading to deadly riots and alarming shortages of fuel, food and medicines earlier this year, India stepped into the breach.

India provided about $4 billion in rapid assistance between January and July, including credit lines, a currency swap arrangement and deferred import payments, and sent a warship carrying essential drugs for the island’s 22 million people.

Now, as Sri Lanka closes in on a $2.9 billion loan deal from the International Monetary Fund (IMF) and its economy stabilises, India is seeking to land ambitious long-term investments, with an eye on countering the influence of regional rival China, a government minister and three sources said.

“What we are looking at right now is investment from them,” Sri Lankan Foreign Minister Ali Sabry said in an interview this month, referring to a range of projects worth over $1 billion currently under discussion that would help bolster India’s presence in Sri Lanka. “They’re willing to invest as much as it takes.”

“India is probably strategically looking at that…because of their security concerns,” Sabry said.

India’s foreign ministry did not respond to questions from Reuters on its plans and strategic aims in Sri Lanka.

Regional security would always be a focus for New Delhi, a source with knowledge of the matter told Reuters, at a time of persistent friction with China along their Himalayan frontier.

“There are no two ways about security concerns,” the source said, asking not to be named because of the sensitivity of the issue. “In terms of long-term engagement, it is investment that is being focused on.”

Besides seeking Indian investments to set up renewable energy and power projects in the north of the island, Sri Lanka is also keen to work with New Delhi on expanding and developing the harbour at Trincomalee in the northeast into a major port, several officials said.

Taking advantage of northern Sri Lanka’s proximity to India, these projects could help New Delhi balance China’s extensive infrastructure projects in the south of the island that have been built up over the last 15 years.

Sri Lanka’s Tamil-dominated north also shares ethnic ties with southern India’s Tamil Nadu state.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)