COLOMBO: Sri Lanka has insisted on the inclusion of a specific clause in the proposed deal with India on the privatisation of the Mattala Rajapaksa airport that makes it clear that the airport will not be used for any military purposes, in a similar manner that was adopted in the Hambantota port lease to China. Sri Lanka began talks in August this year with India on the latter’s proposal to acquire a stake in the hugely loss- making Mattala International Airport near Hambantota, to turn it around and make it a profitable venture.

The main conditions of the deal is expected to be inked by December this year, according to Sri Lankan government sources who say that the airport will not be allowed to be used for any military purposes and that air traffic controlling power would be held with Sri Lanka.

A project committee and a negotiating committee are said to be in the process of finalising the key terms of the agreement.

The two countries are however not seeing eye to eye yet on the basic terms of the agreement with India proposing that it be given a 70 per cent stake in the joint-venture and Sri Lanka is willing to give only a 40pc stake. The matter is however expected to be resolved to some extent when the chief valuer gives his opinion sometime next week.

The Sunday Times based in Colombo in a report today said that the Indian government’s valuation has been placed at US $293 million and it has offered US$ 205 million, which is equivalent to 70 percent of the value. Analysts point out that the Indian offer is a “carbon copy” of the China Hambantota deal except for the number of years of the lease. China has obtained the Hambantota port for 99 years while India has proposed that the joint venture to be initially for a 40-year period.

Published in Dawn, September 11th, 2017