Sri Lanka Approves Kankesanthurai Port Renovation with India Funding Entire Cost

Sri Lanka's Kankesanthurai Port to be renovated, with India funding the entire $61.5M project, boosting trade and connectivity between the two nations.

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Rafia Tasleem
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Sri Lanka Approves Kankesanthurai Port Renovation with India Funding Entire Cost

Sri Lanka Approves Kankesanthurai Port Renovation with India Funding Entire Cost

The Sri Lankan Cabinet has approved the renovation of the Kankesanthurai Port in the Northern Province, with India agreeing to grant the entire cost of the project, estimated at USD 61.5 million. The Kankesanthurai Port, also known as the KKS Port, is located 104 km (56 nautical miles) from Karaikal Port in Pondicherry, India.

The original cabinet approval for the project was given on May 2, 2017, and the approval for offering Project Management Consultant Services was given on December 18, 2019. However, the project implementation had been delayed due to the estimated cost being higher than the relevant loan amount.

Further discussions have been held with the Government of India regarding the possibility of completing the project under the Public Private Partnership Method. "The project implementation had been delayed due to the Economic Value of Equity (EVE) estimated cost provided by consulting service agencies being higher than the relevant loan amount," a cabinet statement said.

Why this matters: The renovation of the Kankesanthurai Port is an important project for both Sri Lanka and India, as it will enhance trade and connectivity between the two countries. The port's strategic location, just 104 km from India's Karaikal Port, makes it a key asset in the region.

The Sri Lankan government's decision to move forward with the project, despite the higher estimated costs, underscores the importance of the Kankesanthurai Port renovation. With India agreeing to grant the entire project cost of USD 61.5 million, the two nations have demonstrated their commitment to strengthening economic ties and infrastructure development in the region.

Key Takeaways

  • Sri Lanka to renovate Kankesanthurai Port, with India funding entire $61.5M cost.
  • Project delayed due to higher estimated cost than relevant loan amount.
  • Discussions held on completing project through Public Private Partnership.
  • Port's strategic location near India's Karaikal Port makes it a key regional asset.
  • Project underscores India-Sri Lanka economic ties and infrastructure development.