Asia-Pacific News

India and China compete for control of an almost empty Sri Lanka airport

Key Points
  • A state-owned Chinese company took control of Sri Lanka's Hambantota maritime port
  • India long been concerned about Chinese influence on Sri Lanka
  • India wants to take over an airport near Hambantota port, a move that analysts say is aimed at countering China's activity

China just took over a port in India's backyard, and now it looks like India is countering the move.

Some 25 miles (40 kilometers) away from a Chinese-operated port in southern Sri Lanka lies an airport that's been dubbed the world's emptiest. India, unruffled by the vacant terminals, is looking to snatch up the under-used complex to monitor Beijing's growing presence in the country.

The international airport at Hambantota, Sri Lanka.

Sri Lanka has long had deep ties with New Delhi, but it's fallen into China's orbit in recent years, with the country a key member of Beijing's wide-ranging "Belt and Road" infrastructure project. India, which isn't a member, is wary the scheme could translate into increased Chinese political and military power in New Delhi's backyard.

Now that a state-owned Chinese company is running Sri Lanka's Hambantota port, Indian Prime Minister Narendra Modi's administration is worried about Chinese influence on its ally.

New Delhi is in advanced talks with Colombo to take over Hambantota's airport, Sri Lanka's civil aviation minister Nimal Siripala told Reuters in October. But China also wants to manage the money-losing facility, which was built on funds borrowed from Beijing, and it's not clear which country Colombo will choose.

Rivalry with Beijing is likely driving India's interest in the airport, explained Duncan Innes-Ker, regional director of Asia and Australasia at the Economist Intelligence Unit.

It is difficult to conceive of the Chinese navy developing a significant facility at Hambantota without also controlling the airport.
David Brewster
Australian National University

As of Friday, China Merchants Port Holdings officially took over commercial activities at Hambantota port, under a joint venture deal that was signed in July.

The maritime facility was originally built by China and is close to crucial Asia-Europe shipping routes, but it has been a money loser. China Merchants has a majority stake and will be leasing the port for 99 years as part of a plan to convert Colombo's $6 billion debt to Beijing into equity.

That's a worrying development for Modi's administration.

"India's main concern has been the long term impact of Chinese state-owned companies acquiring equity in the Sri Lankan economy and the extent to which Chinese influence on Sri Lanka's economy would affect Colombo's ability to practice an independent foreign policy," Smruti Pattanaik, research fellow at the New Delhi-based Institute for Defence Studies and Analyses wrote in a report earlier this year.

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Chinese-Indian relations have been strained in 2017: July and August saw the countries in a fierce border standoff in the Himalayas, while Chinese naval activities in the Indian Ocean have also bothered New Delhi. Security analysts have long warned of a Chinese network of military and commercial facilities in the Indian Ocean aimed at bolstering Beijing's regional power.

New Delhi is primarily concerned that the Hambantota port could become an Indian Ocean hub for China's navy, David Brewster, a researcher at Australian National University, said in a recent note published on The Lowy Institute.

"Control over Hambantota airport will give India considerable control over how the port is used. It is difficult to conceive of the Chinese navy developing a significant facility at Hambantota without also controlling the airport."

Economic potential for an under-utilized airport

Sri Lankan President Maithripala Sirisena's administration has dismissed the prospect of Chinese naval facilities in the country, but "New Delhi worries that China's influence will one day reach a point where the Sri Lankan government simply cannot say no," Brewster continued.

Colombo is all too aware of the rivalry between India and China — In May, it rejected a Chinese request for a submarine visit in response to adamant Indian objections.

Geopolitical interests aside, the airport could ultimately make a good investment for India.

Despite operating only one flight per day — business is so slow that certain areas are rented out for rice storage, according to reports — the airport holds potential, said Innes-Ker. It can relieve strains on the capital's airport and provide easier access to national attractions, he noted.

Indian backing, Innes-Ker said, could "match these factors together and make a more successful economic case for the airport."