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Harsh Pant

Harsh Pant

Harsh is a contributor to ISN Security Watch

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India and China Battle over Sri Lanka

With the LTTE out of the picture and Sri Lanka growing stronger, India struggles to maintain its relevance in the strategically crucial Indian Ocean nation. But so far, China is ahead of the game.

On the face of it, Sri Lankan President Mahinda Rajapaksa’s visit to New Delhi last week was rather successful. India and Sri Lanka signed a range of agreements including loans for major infrastructure projects, sharing of electricity and boosting of cultural exchanges.

India has extended a line of credit of $200 million to assist in the setting up of the NTPC-CEB Joint Venture of a 500MW thermal power plant at Trincolamalee. The two nations also decided to set up an annual defense dialogue and increase high-level military exchanges. A treaty on mutual legal assistance in criminal matters and an MoU on sentenced prisoners was also agreed upon by the two sides. India has agreed to construct a rail link between Talaimannar and Madhu in the Northern Province in Sri Lanka.

However, in the southern Indian states and especially in Tamil Nadu, anger at the Rajapaksa government’s conduct during the war with the Liberation Tigers of Tamil Eelam (LTTE) still remains high.

Just recently, pro-LTTE activists blasted a railway track in Tamil Nadu and pamphlets condemning Rajapaksa’s visit to India were found at the site. A delegation of Indian lawmakers from Tamil Nadu met Rajapaksa regarding the delays in rehabilitating Lankan Tamils displaced by the civil war. The president acknowledged the delay and suggested that those staying in relief camps would be resettled within three months.

The political parties in Tamil Nadu might be tempted to play the Lankan Tamil card with an eye on state elections in a year’s time even though the issue had little resonance in the Lok Sabha elections last year.

Indian Prime Minister Manmohan Singh also emphasized the need for urgent steps to resettle the internally displaced persons and urged the government to undertake speedy rehabilitation and reconstruction efforts in northern and eastern Sri Lanka. Singh underlined the need for a meaningful devolution package, building on the 13th amendment that would create the necessary conditions for lasting political settlement. Rajapaksa, however, was largely non-committal on this.

The Sri Lankan president is at the height of his power after having defeated the LTTE and winning an overwhelming mandate for himself and his party. Yet his government’s human rights record is under critical scrutiny in the West and clearly a visit to India would have helped him in underlining New Delhi’s backing for his government to the world.

But beyond that symbolic value, Sri Lanka is rapidly slipping out of India’s orbit. India failed to exert its leverage over the humanitarian troubles facing the Tamils trapped in the fighting. New Delhi’s attempts to end the war and avert humanitarian tragedy in north-east Sri Lanka proved utterly futile.

Colombo’s centrality between Aden and Singapore makes it extremely significant strategically for Indian power projection possibilities. After initially following India’s lead in international affairs, even demanding that the British evacuate their naval and air bases at Trincomalee and Katunayake in 1957, Colombo gradually gravitated towards a more independent foreign policy posture. And it was India’s enthusiasm for China that made Sri Lanka take China seriously; however, after the Chinese victory in its 1962 war with India, Colombo started courting Beijing much more seriously.

And today China has displaced Japan as Sri Lanka’s major aid donor with an annual aid package of $1 billion. Bilateral trade between China and Sri Lanka has doubled over the last five years, with China emerging as Sri Lanka’s largest trading partner. China is now supplying more than half of all the construction and development loans Sri Lanka is receiving.

Chinese investment in the development of infrastructure and oil exploration projects in Sri Lanka has also gathered momentum. China is providing interest-free loans and preferential loans at subsidized rates to Sri Lanka for the development of infrastructure.

China is the first foreign country to have an exclusive economic zone in Sri Lanka and is involved in a range of infrastructure development projects there– constructing power plants, modernizing railways, providing financial and technical assistance in launching of communication satellites.

China is financing more than 85 percent of the Hambantota Development Zone to be completed over the next decade. This will include an international container port, a bunkering system, an oil refinery and international airport, and other facilities. The port in Hambantota, deeper than the one at Colombo, is to be used as a refueling and docking station for its navy.

Though the two sides claim that this merely a commercial venture, its future utility as a strategic asset by China remains a real possibility to India’s consternation. For China, Hambantota will not only be an important transit for general cargo and oil but a presence in Hambantota also enhances China’s monitoring and intelligence gathering capabilities vis-à-vis India.

Indian has expressed its displeasure about growing Chinese involvement in Sri Lanka on a number of occasions. In 2007, India’s then-national security advisor had openly criticized Sri Lanka for attempting to purchase a Chinese-built radar system on the grounds that it would “overreach” into the Indian air space.


Yet Sri Lanka has emerged stronger and more stable after the military success in the Eelam war and two national elections. To counter Chinese influence, India has been forced to step up its diplomatic offensive and offer Colombo reconstruction aid.

With the LTTE now out of the picture, New Delhi is hoping that it will have greater strategic space to manage bilateral ties. However, where New Delhi will have to continue to balance its domestic sensitivities and strategic interests, Beijing faces no such constraint in developing even stronger ties with Colombo. As a consequence, India is struggling to make itself more relevant to Sri Lanka than China.

Colombo matters because the Indian Ocean matters. The ‘great game’ of this century will be played on the waters of the Indian Ocean. Though India’s location gives it great operational advantages in the Indian Ocean, it is by no means certain that New Delhi is in a position to hold on to its geographic advantages. China is rapidly catching up and its ties with Sri Lanka are aimed at expanding its profile in this crucial part of the world. Indian policymakers realize that unless they are more proactive they might end up losing this ‘game’ for good.

By Harsh V Pant

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  • Anonymous on August 18 2011 said:
    India fed the LTTE under the Indhira Gandhi regime in early eighties.Why SL moves more and more towards China is the mismanagement of India on SL.during the eealam war 4 while India tried to stop the war during its last stages China and Pakistan provided all the weaponary the island nation needed.So it with great gratitude Sri lankans will remember Chinese assistance forever.

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