The US International Development Finance Corporation (DFC) said on Wednesday that it will provide USD 553 million toward the construction of a port facility in Colombo, which is partially owned by the Adani Group of India.
“DFC’s $553 million investment for the long-term development of the West Container Terminal at the Port of Colombo will attract critical foreign exchange inflows during Sri Lanka’s economic recovery and facilitate growth led by the private sector.” The United States’ long-standing commitment to the advancement and welfare of Sri Lankans is shown by this funding. Rebuilding Sri Lanka’s economy will contribute to our common goal of an Indo-Pacific region that is free and wealthy, according to a statement from Julie Chung, the US ambassador to Sri Lanka.
After experiencing a 7.8% economic contraction in 2022 due to record low foreign currency reserves last year, Sri Lanka is gradually recovering from its greatest financial crisis. According to Reuters, the Adani group, which is founded by Indian billionaire Gautam Adani, has a 51 percent share in the port’s west container terminal, which is also home to a terminal operated by China Merchants Port Holdings Co Ltd.
DFC claimed that in only four years, their investment in Sri Lanka increased from less than $20 million to over $1 billion. “In addition to strengthening the position of our allies throughout the region, DFC’s commitment of $553 million in private sector loans for the West Container Terminal (WCT) will expand its shipping capacity, creating greater prosperity for Sri Lanka – without adding to sovereign debt,” DFC CEO Scott Nathan said in a statement.
Approximately USD 4 billion in credit lines and swaps were provided by India to Sri Lanka last year, giving vital assistance for the importation of fertilizer, gasoline, and medication amid the worst of the crisis. According to the agency report, the state-run Sri Lanka Ports Authority (SLPA) holds the remaining 34% of the WCT, with the Sri Lankan conglomerate John Keells Holdings owning the other 34%. It also said that the terminal’s dredging project began in November of last year, with the first phase expected to be concluded in the third quarter of 2024 and the project as a whole by the end of 2025.
