China’s Exim bank signs $350 mllion deals to develop infra-facilities in Sri Lanka

Sri Lanka and China's Exim Bank have entered into deals to build a highway and an oil bunkering facility near one the world's biggest shipping lanes, according to Sri Lanka's Foreign Ministry. 

The deals valued at more than $350 million come on the back of $360 mllion pledged by the bank towards the initial construction phase being carried out by Chinese firms. The bunker terminals will come up at Hambantota port on Sri Lanka's southern coast. 

Under the agreement the bank will finance the building of a highway from the Sri Lankan capital Colombo to the international airport 30 km to the north in Katunyaka. The highway will cut drastically cut the travel time which presently takes hours because of the narrow traffic clad roads. 

In July China won the rights to the island nation's first exclusive economic zone, in Mirigama which is easily accessible from Colombo port and airport. 

Huichen Investment Holdings Ltd of Hong Kong will pay $28 million to build the turnkey business park, where Chinese firms can set up shop. The park is modeled along China's successful strategy in African nations of housing manufacturing and other businesses around mineral and resource extraction firms. 

India sees the Chinese initiative in Sri Lanka as a component of its 'string of pearls' policy to offer it coaling stations in the region. New Delhi views this as part of Chinese plans to strategically encircle India.