China has agreed to provide US$ 100 million (Rs. 13.2 billion) to the Sri Lankan Ministry of Defence, in order to fund army camps in the North and East of the island reported the Sunday Times.

According to official sources, the funds would be used to provide develop camps all across the North-East including  Mannar, Palaly, Elephant Pass, Pooneryn, Thalladi, Karainagar, and Mullaitivu.

The Sunday Times reported that the government had deemed such installations “essential for national security”.

Additionally China will also be providing a grant of US $1.5 million for the Defence Services College in Colombo, which teaches children of the armed forces and police, from grades 6 to 12.

The funding is said to come from the Export-Import (Exim) Bank of China, although the details have not yet been reported.

See our earlier post:  Who benefits from Chinese loans to Sri Lanka? (21 November 2010)

Meanwhile Sri Lanka has reportedly agreed to purchase six MA-60 aircraft from China, at a cost of US$ 105.4 million.

Reporting of the financial assistance comes as Chinese Defence Minister and former Chief of Staff of the People’s Liberation Army Liang Guanglie plans to tour the island on Wednesday, on a five-day visit.

Next month a 96-member delegation led by Chinese People’s Congress’ Vice President U. Bango is also scheduled to visit Sri Lanka, as well as tour the North-East.