The Memorandum of Cooperation (MoC) was signed in Colombo on Tuesday by Sri Lankan ports minister Sagala Ratnayake, Indian high commissioner to Sri Lanka Taranjit singh Sandhu and a Japanese representative.
As per the agreement, Sri Lanka Port Authority (SLPA) will hold 51 percent majority stake in the port development while Japan and India will have combined stake of 49 percent.
The three governments have decided to work out details at joint working group meetings and advance their cooperation towards early commencement of work and operation of the terminal.
SLPA said the joint project reflects the longstanding good will and cooperation among the three countries. It said Sri Lanka, Japan and India will work together for further development of the Colombo Port and contribute to further regional prosperity and stability of global trading networks.
The deal is significant as over 70% of India’s transhipment business is handled at Colombo ports. One of the terminals is controlled by Chinese company and there was a long pending proposal to handover the development of Eastern terminal to an Indian company. The deal is part of Memorandum of economic cooperation signed between India and Sri Lanka in 2017.