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Table of Contents
WHAT JUST HAPPENED?
United States has announced to grant $39 million (280 crore crore) as part its foreign military financing to Sri Lanka to boost maritime security. The US funding for Sri Lanka is part of its $300 million set aside for South and Southeast Asia to ensure free, open, and rules-based order in the Indo-Pacific region.
COMPETITION
For perspective on the figures, it’s useful to recall that when Prime Minister Ranil Wickremesinghe visited Beijing earlier this year, China pledged over US$ 300 million in development assistance to Sri Lanka for the years 2018 – 2020, apart from over US$ 60 million in the current year, according to reports.
CHINESE LOANS
Last week, the Central Bank of Sri Lanka announced it had secured a US$1 billion Chinese loan as the island develops closer relations with Beijing. New details have emerged, including the news that despite ceding the port, Sri Lanka is more indebted to Beijing than ever thanks to the high interest rates on its existing loans. This year, the country owes nearly $13 billion
U.S SRI LANKA HISTORY
- The US had stopped arms sales to Sri Lanka during the height of the island’s Tamil separatist war, which ended in 2009.
- The global power has also been highly critical of the humanrights record of the former government of strongman president Mahinda Rajapakse.
- Several senior military commanders from the Rajapakse regime have been denied visas to visit the U.S.
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NOT JUST U.S IS WORRIED
- Onodera wants cooperation between the two countries to be based on Japan’s “Free and Open Indo-Pacific Strategy.”
- He also plans to discuss the continuation of joint training exercises that Japan’s Maritime Self-Defense Force participates in, along with the Indian and US navies.
- Onodera will become Japan’s first defense minister to visit Sri Lanka. He will inspect Hambantota Port in the southern part of the country.
INDIA’S BIG MOVE
The two governments, after detailed negotiations, have agreed that India, with a 70% stake in the joint venture, will contribute $225 million to revamp and run the airport, while the Sri Lankan side will invest the balance. India will operate the airport on a 40-year lease, as per the draft agreement
INDIAN AID TO SAARC NATIONS FALLS
Going by government data, assistance fell from ₹5,928.6 crore for 2013-14 to ₹3,483.6 crore for 2017-18
HOW STRATEGICALLY IMPORTANT IS SRI LANKA?
- First time in five centuries, global economic balance of power is once again shifting towards Asia. It is estimated that, by 2030, Asia will surpass North America and Europe combined in global power based on gross domestic product (GDP), population size, military spending and technological investments.
- Of the four largest economies of the world – US, China, Japan and India –three are located in Asia.
- Sri Lanka’s situation in the nautical corridor between the East and West is not only of importance from a geostrategic perspective but also from a maritime, economics and security perspective.
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