New Delhi has been opposing the project, alleging it was being built as part of China’s military strategy.

However, the port city is a must for Sri Lanka, and it has become an issue that is even affecting diplomatic ties with China.

Sri Lankan authorities have been bringing up this matter with Indian counterparts.

India has now agreed to the project, depending that outright ownership should not be given for the port city’s land, and that Chinese submarines should not be allowed into seas near Colombo.

New crisis

This is likely to create a new crisis for the project.

As per the signed project agreement, the Chinese constructor will have outright ownership of the 108 hectares, and will allow it to sell 62 hectares to Sri Lanka to cover for its expenses for the project.

Environmental impact

Environmentalists warn of very adverse impacts on environment by the project, and the coast conservation department has obtained views and suggestions from the public on its environmental impact assessment report.

However, these views and suggestions have not yet been considered, while the state media and government officials are saying the project will not impact the environment.