A Deal
source: The Indian Express
Context:
Trincomalee oil tank farm deal is a coveted project that has remained controversial for a long time.
India and Sri Lanka have been negotiating this project for 16 months.
For this purpose, Sri Lanka’s Energy Minister Udaya Gammanpila has instructed the Ceylon Petroleum Corporation (CPC) to form a subsidiary company called Trinco Petroleum Terminal Ltd.
This move follows President Gotabaya Rajapaksa’s approval on setting up a special purpose vehicle.
It comprises 99 storage tanks, with a capacity of 12,000 kilolitres each, spread across Lower Tank farm and Upper Tank Farm.
In 2003, Indian Oil Corporation set up its Sri Lankan subsidiary called Lanka IOC, to work on this oil farm.
Currently, Lanka IOC runs 15 tanks. The new agreement is being negotiated for the remaining tanks.
Trincomalee Oil Tank Farms:
The Trincomalee Oil Tank Farms is located in ‘China Bay’ in proximity to the internationally coveted deep water natural harbour of Trincomalee.
The Oil Tank was built by the British during World War II as a refuelling station.
The Oil Tank comprises 99 storage tanks with a capacity of 12,000 kilolitres each, spread across Lower Tank farm and Upper Tank Farm.
The proposal of joint development of this tank was envisaged 35 years ago, in the Indo-Lanka Accord 1987.
However, things barely moved until 2003 when the Indian Oil Corporation set up its Sri Lankan subsidiary, called Lanka IOC, to work on this oil farm.
Currently, Lanka IOC runs 15 tanks. The new agreement is being negotiated for the remaining tanks.
What will be the significance of this deal?
Strengthening Partnership: The deal will strengthen India and Sri Lanka's energy partnership to enhance Sri Lanka’s energy security.
Strategic Location: Trincomalee remains in the spotlight as a potential transit point for international trade routes.
Counterbalance to China: From India’s viewpoint, Trincomalee is an important counterbalance to the Hambantota Port backed substantially by China.
Easily Accessible: It is located on a deepwater natural harbour of Trincomalee.
Location in the Indian Ocean: These oil farms are located along some of the world’s busiest shipping lanes.
Indo-Sri Lankan Accord:
Signed in 1987.
Popularly referred to as the Rajiv-Jayewardene Accord, after its architects Prime Minister Rajiv Gandhi and President J.R. Jayewardene.
It sought to collectively address all the three contentious issues between India and Sri Lanka: strategic interests, people of Indian origin in Sri Lanka, and Tamil minority rights in Sri Lanka.
This accord saw the induction of the Indian Peace Keeping Force (IPKF) in Sri Lanka.
According to the terms of the accord, Sri Lankan forces would withdraw from the north and the Tamil rebels would disarm.
The accord was expected to resolve the Sri Lankan Civil War by enabling the thirteenth Amendment to the Constitution of Sri Lanka and the Provincial Councils Act of 1987.
India-Sri Lanka Relations Issues in Brief:
China’s Intervention: China’s swiftly developing financial footprint (and political clout as a corollary) in Sri Lanka is straining India-Sri Lanka relations.
China is already the biggest investor in Sri Lanka, accounting for 23.6% of the whole Foreign Direct Investment (FDI) all through 2010-2019 as in opposition to 10.4% from India.
China is likewise one of all the biggest export locations for Sri Lankan items and holds over 10% of its outside debt.
China is likewise coping with the Hambantota Port of Sri Lanka, the port is regarded as part of China’s String of Pearls Strategy.
Katchatheevu Island Issue: India ceded the uninhabited island to its southern neighbour in 1974 below a conditional accord.
However, in many instances, the fisherman's difficulty arises greater out of a home tussle in preference to the India-Sri Lanka view at the difficulty.
Thirteenth Amendment of the Sri Lankan Constitution: Indo-Sri Lankan Accord become signed in 1987 to offer a political method to Sri Lanka’s conflict.
It envisages the devolution of vital powers to the provincial councils to cope with the simple call for of Tamil human beings for equality, justice, peace, and admiration inside a united Sri Lanka.
The provisions of this accord had been made inside the Sri Lankan constitution, through the Thirteenth Amendment.
However, nevertheless, the provisions aren't applied on the ground. Even to this day, slot of Srilankan Tamils who avoided from Srilankan civil war (2009) are searching for shelter in Tamil Nadu.
Back Tracing of Sri-Lanka: Recently, Sri Lanka subsidized out from a tripartite partnership with India and Japan for its East Container Terminal Project on the Colombo Port, bringing up home issues.
India's cooperation with Sri Lanka: recent developments
Four Pillar Initiative: Recently India and Sri Lanka agreed on a four-pronged approach to discuss food and energy security initiatives to help alleviate the crisis economy of Sri Lanka.
This four-pillar initiative includes lines of credit, foreign exchange agreements, modernization projects (such as the Indian housing project), and Indian investments.
Joint Exercises: India and Sri Lanka conducted joint military (Mitra Shakti) and naval (SLINEX) exercises.
Participation in clusters: Sri Lanka is also a member of regional clusters such as BIMSTEC (Bay of Bengal Initiative for Multisectoral Technical and Economic Cooperation) and SAARC in which India plays a leading role.
SAGAR Vision: Srilanka supports India's concern for the security of the Indian Ocean with its “Neighborhood First” policy and SAGAR (Security and Growth for All in the Region).
The way forward
The neighborhood policy with Sri Lanka is important for India to safeguard its strategic interests in the Indian Ocean region.
India's foreign policy towards Sri Lanka as part of its "island diplomacy" must also evolve in line with emerging realities and threats.
The two countries can also work together to improve private sector investment to build economic resilience.
