First Business News Portal in English from Nepal
KATHMANDU: The US will provide US$553 million in financing for a port terminal in Sri Lanka’s capital being developed by Indian billionaire Gautam Adani, as New Delhi and Washington look to curtail China’s influence in South Asia.
The funding from the International Development Finance Corporation (DFC) underscores renewed US and Indian efforts to loosen Beijing’s sway over Sri Lanka after Colombo borrowed heavily to splurge on Chinese port and highway projects before its economic meltdown last year.
For Adani, US money may offer a stamp of legitimacy after allegations of fraud by short-seller Hindenburg Research erased billions from the conglomerate’s market value earlier this year.
The deepwater West Container Terminal in Colombo is the US government agency’s largest infrastructure investment in Asia and among its biggest globally. It will bolster Sri Lanka’s economic growth and “its regional economic integration, including with India, a key partner to both countries”, DFC said.
The funding is part of a global acceleration of DFC investments that totalled US$9.3 billion in 2023.
“It is a high priority for the US to be active in the Indo-Pacific region,” Scott Nathan, the DFC’s chief executive officer told reporters in Colombo on Wednesday (Nov 8). “It is obviously the engine of economic growth for the world.”
China had invested about US$2.2 billion in the island nation as of the end of last year, its biggest foreign direct investor. US officials have publicly criticised Sri Lanka’s little-used southern Hambantota port as unsustainable and part of what it calls China’s “debt-trap diplomacy.” TheBusinessTimes
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