♤ Sri Lanka is also a keen supporter of the Belt and Road Initiative (BRI)of China.

♤ Sri Lanka’s estimated national debt is $64.9 billion, of which $8 billion is owed to China— this can be attributed to the high interest rate on Chinese loans. For the Hambantota port project, Sri Lanka borrowed $301 million from China with an interest rate of 6.3%, while the interest rates on soft loans from the World Bank and the Asian Development Bank are only 0.25–3%. Interest rates of India’s line of credit to the neighboring countries are as low as 1%, or even less in some cases.

5.5.1. India Interest

♤ The Mattala Rajapaksa International Airport (MRIA) in Hambantota, 250 km south from Colombo, was built with with Chinese assistance of $190 million, more than 90 per cent of

the total cost. Today, MRIA is running into losses and Sri Lanka is unable to pay back dues to China’s EXIM Bank. Ironically, Sri Lanka may now hand over the airport to India so that it can repay the Chinese loan. India is in advanced talks with Sri Lanka to operate the airport.