Sri Lanka occupies a geo-strategically important position. Because about two-thirds of the world’s oil and half of the world’s container transportation passes through the south of Sri Lanka. Therefore, Sri Lanka, which is strategically located, stands out in terms of the security of maritime communication and trade lines in the Indian Ocean.
On the other hand, Sri Lanka is home to ports that have the potential to become important maritime hubs in the Indian Ocean. Sri Lanka’s geographical location and strategic ports put it in a good global and regional position. The crisis in Sri Lanka makes this difficult. Moreover, the crisis that is hampering Sri Lanka’s economic and political stability could have serious repercussions on India.
Sri Lanka, which is in an economic crisis, has a lot of difficulties in paying its debts. China is the largest creditor of this country. About one-fifth of Sri Lanka’s total debt consists of payments to China. The country is therefore characterized as a country that has fallen into “China’s debt trap diplomacy.”[1] Indeed, Sri Lanka is cited as the country that sets an example for African countries to hesitate and think over and over while taking loans from China. Because Chinese loans they received to carry out large projects are one of the main reasons for the country’s economic crisis. Despite allegations of a debt trap, Sri Lanka has continued to obtain loans from China and work with China to continue its projects in the country. In short, Sri Lanka-China relations have reached a good level.
On the other hand, India has a security concern due to Sri Lanka’s strategic location and geographical proximity. Because Sri Lanka’s economic and therefore political dependence on China has led to an increase in Chinese influence in the country. It is also discussed whether China, which has leased the operations of the Hambantota Port for 99 years in the short term, will establish a base there. These discussions raise New Delhi’s concerns.
In addition, due to the sight of a Chinese military ship in the said port, it was claimed that the Chinese Navy ships were supplied by tankers from Sri Lanka.[2] This, of course, worries India. This is because these allegations indicate that this situation may continue. Given the rivalry and problems between India and China and India’s desire to maintain stability, peace and security in the region, Sri Lanka becomes even more important. Because the country, which is geographically close to India, may create a security vulnerability for New Delhi as it is in the economic grip of China.
Addressing all these issues, India is increasing its humanitarian aid activities and financial support to prevent Sri Lanka from approaching China and to save the country from Beijing. Indeed, since the outbreak of the crisis, India has made a great sacrifice in providing aid and support to Sri Lanka. India’s provision of 4 billion dollars in funding, at least to keep the country’s economy afloat, is an example of this self-sacrifice.[3] In addition, India supported Sri Lanka in the IMF in terms of its debt to the International Monetary Fund (IMF) and the restructuring and supplied medicine by sending ships to this country for humanitarian aid.
New Delhi’s commitment to Sri Lanka is evident from the fact that in a short period it has provided more financial and humanitarian aid to Sri Lanka than it has ever done in the past. This reveals the value Sri Lanka carries for India in terms of both regional security and peace and stability. Rivalry with Beijing is also causing New Delhi to focus on the issue.
It can be stated that India not only cares about Sri Lanka due to security concerns but also considers its economic potential. Because this small island country has a serious economic capacity. With seaports through which two-thirds of the world’s oil and a significant portion of maritime trade passes, Sri Lanka could offer long-term economic potential for India.
The Sri Lankan government, on the other hand, wishes to become an important center by using the geostrategic and economic advantages of its ports, especially the Colombo Port. At this point, economic and political cooperation with India may offer new opportunities to Sri Lanka both to develop and expand its ports and to increase its economic and geopolitical importance in regional and global terms.
One of the most important reasons why Colombo Port was written in the first place is that it is one of the busiest and most active ports in the world. The fact that it is one of the rare ports that provide services for large container transportation in the South Asian region increases this importance even more. Due to the features, this port is preferred over others.[4] The Port of Colombo is also seen as a critical transshipment hub for New Delhi as it handles close to half of India’s transshipment cargo.
In short, Sri Lanka, located just south of India, is very important for New Delhi in terms of security and stability. Therefore, a country in economic crisis and increasingly dependent on China could become a major problem for New Delhi. For this reason, it is seen that India tends to establish a strategic partnership with Sri Lanka.
On the radar of major powers such as Japan, the US, and the UK, as well as China and India, Sri Lanka has become a hub in the Indian Ocean. For this reason, the financial support that Sri Lanka will receive from India and other countries is considered by many experts as a balance against China. On the other hand, it is also claimed that Sri Lanka could use its relations with China and its strategic position and importance to extract economic support and concessions from India. The adoption of such a strategy for the protection of a small and economically crisis country is considered quite rational.
[1] Sumathi Bala, “Sri Lanka ‘Can’t Get out of Crisis without China,’ Analyst Says”, CNBC, https://www.cnbc.com/2022/07/20/china-can-play-critical-role-to-help-sri-lanka-with-its-debt-problems-analysts-say.html, (Date of Accession: 03.12.2022).
[2] “India Upset as Sri Lanka Fuels China’s Warships on the Sly”, India Narrative, https://www.indianarrative.com/india-news/india-upset-as-sri-lanka-fuels-chinas-warships-on-the-sly-67512.html, (Date of Accession: 03.12.2022).
[3] “India Provided Nearly $4 Billion in Food, Financial Assistance to Sri Lanka”, Business Standard, https://www.business-standard.com/article/international/india-provided-nearly-4-billion-in-food-financial-assistance-to-sri-lanka-1220905000381.html, (Date of Accession: 03.12.2022).
[4] Sooriya Bandara et. al., “Causal Relationship Between Indian Ports’ Originated Container Traffic and Total Transshipments of Port of Colombo: A Granger Causality Analysis”, Journal of Navigation and Port Research, 42(5), 2018, p. 359.
