French media “Le Monde” reported on July 21 that the Rajapaksa clan in power in Colombo city had been associated with the spectacular growth of Beijing’s investments before Sri Lanka’s President Gotabaya Rajapaksa fled the country. Rajapaksa resigned on Friday, July 15, following months of sustained protests. India had lost its traditional influence here, but things seem to be changing.
The fall of the Rajapaksa family is the golden opportunity for India to regain its influence on the crisis-hit island nation.
An Indian diplomatic source confirms that the crisis is undoubtedly a way for New Delhi to improve its relationship with Colombo. Besides, India currently enjoys “a positive image in Colombo.”
India had rushed to release credit lines for the island nation with $3.8 billion to purchase essential goods, fuels, and fertilizers. Moreover, India has provided humanitarian assistance.
This outstretched hand is part of the “Neighborhood First” policy desired by New Delhi to recover its impact on the region, especially Sri Lanka, where China has imposed itself through infrastructure projects within the Belt and Road Initiative framework.
Under the 10-year presidency of Mahinda Rajapaksa (2005 – 2015), Sri Lanka owed a massive debt to Beijing. He became the prime minister after his brother Gotabaya was elected president in 2019. The disproportionate projects of a head of state suffering from delusions of grandeur had led to a resounding failure.
For example, the construction of a port terminal and an international airport in Hambantota, southern Sri Lanka, Rajapaksa’s hometown.
The port has never attracted cargo ships, and the airport has never drawn planes. Consequently, Sri Lanka must hand over the operation of the port and terminal to China’s state-owned enterprise, China Merchants Port Holdings, for 99 years. This is in exchange for the cancellation of more than $1 billion in loans the island country owes China.
Since the crisis culminated in mid-July, China has remained silent.
Constantino Xavier, an associate research fellow at the Centre for Social and Economic Progress, says that India has done a lot for the debt-trapped country with a considerable effort in the last six months regarding funding. This is opposite to the relative absence of China since this crisis began.
The case of Sri Lanka could be a landmark because the Belt and Road Initiative has lost some of its appeal, especially in countries mired in huge Chinese debt. One senior Indian diplomat says the Sri Lankan crisis could be a wake-up call for countries eager to benefit from Chinese investment.
However, a related article in France’s Le Monde suggests that China is far from finished in Sri Lanka.