Asia/Pacific News
Sri Lanka Looks at Naval Base for Hambantota as Second Development Phase Gets Underway
A naval base may be built at Sri Lanka's Magam Ruhunupura Mahinda Rajapaksa Port (Hambantota Port), which is said to have been underused since it was built with a Chinese loan in 2010, local media reports.
Arjuna Ranatunga, Sri Lanka's Minister of Ports, received approval on July 22 from the Sri Lankan cabinet to undertake a feasibility study and prepare a plan to build a naval dockyard at the site.
Hambantota Port has so far cost around $1.5 billion to construct, most of which being coming from a loan from EX-IM Bank of China, and while there have been differing accounts of how many ships have called at the port, it has generally been considered to be underutilized
In 2012 the port was declared exempt from all levies except handling charges and designated for transshipment.
Despite hefty annual interest payments on the Chinese loan, work is nevertheless now underway on an $808 million Phase II development of the port, and China will have exclusive rights to four of the berths under construction.
"The new government aims to transform the port premises into the new socio-economic development with international industrial giants," a press release from the Sri Lanka Ports Authority (SLPA) states.
In April, the SLPA was reportedly looking for joint venture partners to run bunkering services at Hambantota Port as a result of diminishing revenues.
