Sri Lanka to sign Hambantota port deal tomorrow: Prime Minister Ranil Wickremesinghe

Sri Lanka will sign a deal with a Chinese firm to sell 70 per cent stake of the strategicallylocated Hambantota port at USD 1.12 billion, Prime Minister Ranil Wickremesinghe said today.

The strategic deal that may raise security concerns in India will be signed tomorrow between state-owned China Merchants Port Holdings (CMPort) and Sri Lanka Port Authority.

The CMPort will have a majority stake in the port.

"We are giving the country a better deal without any debt," Wickremesinghe said.

He said the money realised from the 70 per cent transfer of equity on a 99-year lease of the Hambantota port will be set off against debts owed to China.

He said the accumulated loss at Hambantota was over USD 300 million.

Wickremesinghe said the government had agreed with the Opposition to have a parliamentary debate on the Hambantota deal but the sittings were disrupted and the House was adjourned till next week.

"How can they face it (the debate) when it was they who started it", Wickremesinghe said, referring to former president Mahinda Rajapaksa's joint Opposition.

Sri Lanka's Cabinet on July 25 approved the sale to a Chinese firm of a 70 per cent stake in the Hambantota port, tweaking the deal after the initial agreement sparked protests.

Accordingly, instead of 80:20 share distribution in the initial agreement shares of overall investment will be revised as 69.55 per cent to CMPort and 30.45 per cent to Sri Lanka Port Authority.

Ports Minister Mahinda Samarasinghe earlier said that Sri Lanka's navy will be responsible for security of the port which will not be allowed as a base for any foreign navy.

His comments are being seen as an attempt to allay Indian concerns over the Chinese presence in the Hambantota port.

India perceives it as a danger to its national security.

The Chinese will manage port operations and Sri Lanka will handle port security, the minister said, indicating that it should allay fears that the port could be misused by the Chinese.