Chinese Vessel in Sri Lanka

Why in News?

Recently, China’s satellite tracking vessel Yuan Wang 5 has arrived at Sri Lanka’s southern Hambantota Port, despite India and the U.S. voicing concern with Colombo over the military ship’s visit.

What do we know about Yuan Wang 5 & Hambantota Port?

• Yuan Wang 5:
  • It is a third-generation vessel of the Yuan Wang series that entered service in 2007.
  • This series of ships include "space tracking ships involved in supporting the manned space programme".
  • It has the ability to track satellites and intercontinental missiles.
• Hambantota Port:
  • Hambantota International Port Group is a Public Private Partnership and a Strategic Development Project between the Government of Sri Lanka and China Merchants Port Holdings (CMPort).
  • This port was given to China by Sri Lanka on a 99-year lease after Sri Lanka failed to repay Chinese loans.
    • It is seen as a case of Chinese "debt trap" Diplomacy.

Why is China’s Presence in Sri Lanka a Concern for India?

• Recently, China's presence in Sri Lanka has increased on a large scale.
  • China is the largest bilateral creditor to Sri Lanka.
    • Its loans to the Sri Lankan public sector amount to 15% of the central government’s external debt.
    • Sri Lanka heavily relies on Chinese credit to address its foreign debt burden.
    • China extended about USD 2.8 billion to Sri Lanka soon after the pandemic hit but has not stepped in much in 2022, even as the island’s economy collapsed rapidly.
  • China has invested about USD 12 billion in Sri Lanka’s infrastructure projects between 2006-19.
  • China enjoys friendlier waters in South Asia and the Indian Ocean than it does in Southeast Asia and the Pacific.
    • China faces opposition from Taiwan, territorial disputes in the South China Sea and East Asia, and myriad frictions with the US and Australia.
• India’s Concern due to China’s Presence:
  • Sri Lanka has decided to establish a Special Economic Zone around the Colombo port city and a new economic commission, to be funded by China.
    • The Colombo port handles 60% of India’s trans-shipment cargo.
  • Leasing of Hambantota and the Colombo Port City project makes it almost certain for the Chinese navy to have a permanent presence in the Indian Ocean which will be worrisome for India’s national security.
    • This Chinese strategy to encircle India is referred to as the Strings of Pearls Strategy.
  • Other South Asian nations like Bangladesh, Nepal and the Maldives have also been turning to China to finance large-scale infrastructure projects.

What should be India’s Approach Moving Forward?

• Preserving Strategic Interests:
  • Nurturing the Neighbourhood First policy with Sri Lanka is important for India to preserve its strategic interests in the Indian Ocean region.
• Taking Advantage of Regional Platforms:
  • Platforms like the BIMSTEC, SAARC, SAGAR and the IORA could be leveraged to foster cooperation in fields like technology-driven agriculture, marine sector development, IT & communication infrastructure etc.
• Restraining Chinese Expansion:
  • India will need to continue to work on the Kankesanturai port in Jaffna and the oil tank farm project in Trincomalee to ensure that China does not make any further inroads in Sri Lanka.
  • Both countries can also cooperate on enhancing private sector investments to create economic resilience.
• Leveraging India’s Soft Power:
  • In the technology sector, India can create job opportunities in Sri Lanka by expanding the presence of its IT companies.
• These organizations can create thousands of direct and indirect jobs and boost the island nation’s service economy.

Source: TH