Following Sri Lanka’s withdrawal from the $500-$700 million-dollar ECT agreement, a second deal has been scrapped as Sri Lanka has reclaimed 99 World War II-era oil storage tanks leased to the Indian Oil Corporation (IOC) in the eastern port district of Trincomalee.
Business Standard reports that in 2003 Sri Lanka had agreed to lease the tanks out for 30 years for an annual payment of $100,000 dollars. The IOC was also granted a third share of Sri Lanka’s Petroleum Storage Limited, however, the Ceylon Petroleum Corporation (CPC) trade unions have been pressing the government for the takeover of the tanks.
Sri Lankan Energy Minister Udaya Gammanpila told the media;
"I am happy to state that the Indian High Commissioner was very flexible at the talks. He ignored the conditions mentioned in the agreement signed in 2017 in order to be helpful to us," Gammanpila said, referring to his discussions with High Commissioner Gopal Baglay.
"He was flexible to agree to all our conditions. A majority of ships which sail around Trincomalee are from India. So, we need India's cooperation to win their market," he added.
The news also follows India offering Sri Lanka a $12 million-dollar grant in an attempt to displace a contract with a Chinese company attempting to install three renewable energy plants on islands just off the coast of Jaffna. This project has been opposed by Tamil parliamentarians who have viewed the project as a security risk to India and to Tamils.
Read more here.