Mattala Project With India is On: Sri Lanka | 04 Aug 2018

In a recent statement, the Sri Lankan government has stated that the talks on ‘Mattala Project’ are ‘progressing’ with India.

What is the ‘Mattala Project’?

  • India and Sri Lanka have agreed that India, with a 70% stake in the joint venture, will contribute $225 million to revamp and run the Sri Lanka’s loss-making Mattala Rajapaksa International Airport in Hambantota, while the Sri Lankan side will invest the balance.
  • India had proposed establishing a flying school and a maintenance hub at Mattala airport to boost airport revenues while it builds up traffic. In future, the airport could also be a destination for Indian tourists.
  • The facility, 241 km south-east of Colombo, is dubbed the “world’s emptiest airport” due to a lack of flights. However, India will operate the airport on a 40-year lease.
  • It is an open secret that India’s strategic interests in running the airport, located near the China-controlled port in Hambantota, outweighs commercial considerations.
  • The matter also remains highly sensitive in the island, since opposition forces, have objected to the “sale of national assets” to foreign countries.

Analysis

  • India is worried about China's growing role in the Indian Ocean as Sri Lanka recently formally handed over control of Hambantota port to China, as part of a $1.1 billion, 99-year lease.
  • From a security perspective, Hambantota would make a fine logistics point for an expanded Chinese naval presence. Although Sri Lanka has repeatedly claimed that no Chinese naval facility will be permitted in Sri Lanka, India worries that China's influence will expand over the Sri Lankan territory.
  • A key element in any overseas naval base is easy access by air for people and supplies. A naval base also requires maritime air surveillance capabilities.This is where the world's emptiest airport comes in handy.
  • Control over Hambantota airport will give India considerable control over how the port is used as it is difficult to conceive of the Chinese navy developing a significant facility at Hambantota without also controlling the airport.