The Sri Lankan government have approved a deal to lease out a block of land, previously sold to the China Aviation Technology Import Export Corporation (CATIC), to Imperial Tobacco Company Ltd. of India.
The land will be given on a 99-year lease for $US73.5 million, allowing the Indian company, a franchisee for the US based Sheraton Group, to construct a hotel and development project estimated to be worth around US$300 million.
After receiving cabinet approval, the government announced that the Board of Investment of Sri Lanka will enter in to a MoU with the Indian company, allowing the deal to be executed under tax concessionary terms and with exemptions.
The land, opposite Galle Face green in Colombo had earlier been allocated to CATIC, in order to build a similar project, in a deal estimated to be worth US$500 million, hailed as one of the island’s single biggest foreign investments.
CATIC had already paid $54.4 million for four acres of the land, before the deal fell through.
See our earlier post: Sri Lanka looks to appease China as hotel deal collapses (Nov 2011)
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