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Rebalancing India-China, The Sri Lanka Way

February 14, 2022 16:24 IST

Colombo seems to be veering to the middle path between China and the US on global matters, but in regional matters of strategic security, it is increasingly identifying with India, points out N Sathiya Moorthy.

IMAGE: Foreign Secretary Harsh Vardhan Shringla calls on Sri Lanka Foreign Minister G L Peiris in New Delhi, February 8, 2022. Photograph: ANI Photo

In New Delhi recently, Sri Lanka's Foreign Minister G L Peiris told interviewers that bilateral ties are moving from a 'transactional' to a 'strategic' phase.

It was a line drawn out from the position paper of his nation's high commissioner, Milinda Moragoda, who has also been flagging the idea since his taking over last year.

The bilateral ties have jumped nautical miles ahead in recent months, say, beginning with the Indian private sector Adani Group getting management stakes in the West Container Terminal project in Colombo port.

Earlier, India was peeved at President Gotabaya Rajapaksa's government cancelling the tri-nation MoU for joint development of the port's Eastern Container Terminal, also involving Japan, signed by the previous government of his political rivals.

Sri Lanka's forex and economic crises have cemented bilateral ties as never before in recent years.

The steep fall in tourism, beginning with the 2019 Easter Sunday serial blasts followed by the COVID-19 pandemic, which also drained internal remittances from Sri Lankans employed overseas -- they all had returned home -- caused the forex crisis.

The economic crisis is a legacy issue and every government since Independence should take the blame.

To this, President Gota made his contribution in the form of overnight 'organic farming' policy, starting with import-ban on items of daily need like turmeric from Tamil Nadu.

Anti-Rajapaksa economists saw it as an honourable way of covering up the impending forex crisis, as applicable to import ban on other goods.

Sooner than later, it translated as previously-undisclosed import of 'organic fertiliser' from China.

Beijing's tactless usury of demanding and obtaining $6.4 million in scarce forex after Sri Lankan farm scientists had rejected the imports as 'sub-standard' has made China overnight unpopular among large sections of Sri Lanka's rural population, who are dependent on farming.

Coupled with that is the instant delivery of chemical fertiliser to save standing crops in vast, if not all the areas, has enhanced India's image as a friend-in-deed among multiple sections.

The knowledgeable are convinced, now as always, that India's terms won't be usurious in any which way.

Sri Lanka could count on New Delhi to relax terms further in unforeseen circumstances such as a tsunami now and a pandemic another time.

Today, there is greater appreciation for India extending about $2.5 billion in aid than when India volunteered Covid-related medical assistance to all neighbours.

The COVID gift package had included medical kits in the early stages, followed by vaccines and oxygen.

Today's forex-related aid includes $ 1 bn in loan for importing essentials, including food and medicines, and $500 million for importing oil to keep the Sri Lankan machinery going.

However, the greater attraction involves the hurried Sri Lankan clearance of the delayed deal for the joint development of the British era Trincomalee oil tank farms -- 99 tanks, total one-million tonne capacity.

Indian expectations are that Colombo would not use motivated protests and court cases to scuttle the project on a later date -- or, allot the 24 Trinco tanks retained by the public sector Ceylon Petroleum Corporation to scuttle the project on a more convenient day, as was the case with such others in the past.

Minister Udaya Gamanpilla has since told the Sri Lankan parliament that India had expressed a desire to participate in oil and gas exploration in Sri Lankan waters. Incidentally, when Norway mapped these waters for oil wealth two decades ago, Sri Lankan critics termed as their hidden agenda for playing facilitator to ethnic talks between the government and the LTTE.

The Peiris-Moragoda use of the term 'strategic' possibly refers to creating a joint 'strategic oil reserve' for both nations to benefit from.

Refurbishing the tanks is going to cost India billions, and the physical security of the farms, both from internal and external threats, on land and sea alike, can be expected to be entrusted to the Sri Lankan forces, particularly the Navy.

The nation's armed forces had sought and got the right when the previous government handed over the southern Hamabantota port territory to China in a debt-to-equity swap-deal after the earlier government of then president Mahinda Rajapaksa -- now Sri Lanka's prime minister -- had got into a usurious construction contract with the Chinese.

Minister Peiris's maiden visit in this term as foreign minister after taking over in August was delayed by the pandemic, though he had met his Indian counterpart Subrahmanyam Jaishankar on the sidelines of the United Nations.

Sri Lanka's Finance Minister Basil Rajapaksa, another brother of President Gota, visited New Delhi not very long ago, where one of his engagements was a uniquely co-hosted meeting by his counterpart Nirmala Sitharaman and Dr Jaishankar.

Incidentally, the two ministers and also High Commissioner Moragoda have also met National Security Advisor Ajit Kumar Doval, indicating that there were other aspects of 'strategic' relations that the two nations were engaged in.

It had all begun with Doval's Colombo visit of November 2020, when the two nations along with common neighbour Maldives elevated their existing yet non-operational Maritime Security Agreement into a 'Maritime and Security Agreement' with all its import.

After Peiris's Delhi visit, an Indian media interview with him is now talking about preliminary talks for the purchase of two India-made Dornier fixed-wing aircraft, which New Delhi had deployed and also donated to the Maldives some time ago for maritime surveillance.

If it happens, the request-and-offer, or offer-and-acceptance as the case may be, should mark the first time New Delhi is supplying military use aircraft, though for not-exactly military purposes, after deciding not to supply lethal war material at the height of the ethnic war in Sri Lanka.

Following the end of the ethnic war in the country, Sir Lanka, since 2011, is the third arm of what originally commenced as the two-nation, bi-annual Dosti Coast Guard friendship exercises.

The last such joint exercise was conducted in Maldives in November 2021. It will be interesting to note if common Ocean neighbours, Mauritius and Seychelles are invited, and participate in the next edition of Dosti.

In between, the two nations participated as observers at the NSA-level talks, and the likelihood of their joining the Maritime and Security Arrangement, with Colombo as the secretariat, among the other three nations cannot be ruled out.

With thr US in Diego Garcia in the middle and India's tri-Services Andamans Command and the upcoming Lakshadweep unit forming the natural flank along with French Reunion, a strong cooperative Indian Ocean Region security arrangement can blockade the mouth of the Indian Ocean for adventurous navies intent on harm.

Evaluating the emerging situation, the ministry of external affairs created a new division on the Indian Ocean Region some years back, overseeing affairs with the Maldives and Sri Lanka, Mauritius and Seychelles.

More recently, it expanded the Indian Ocean Region division to include western Indian Ocean nations, namely, Madagascar, Comoros and Reunion.

This does not automatically mean that these nations, especially Madagascar and Comoros, are with India on matters the Indian Ocean Region. Instead, it is India's way of looking at the Indian Ocean Region south of its land territory as a single unit on matters of maritime development, security and consequent concerns.

In Delhi, Peiris also extended invitation for Prime Minister Narendra Modi to attend the BRICS Summit in Colombo next month.

If Sri Lankan media speculation comes true and Modi attends the summit -- possibly with a bilateral on the sidelines -- then, India would have upturned predecessor Manmohan Singh's last-minute cancellation from the 2008 CHOGM, though the comparison should end there.

It also remains to be seen if BIMSTEC would follow the ASEAN precedent of offering the seat to Myanmar, but not to the ruling junta.

The subdued bilateral euphoria of the present is to be accompanied by the Indian vote at yet another UNHRC resolution on Sri Lanka in March, after New Delhi had abstained a year ago.

Beginning last year's Resolution 46/1, the West-initiated resolution has gone beyond the original war crimes probe to include every day violations, the likes of which deviate from the original and are also committed by other States, including some of the resolution-movers.

The West, starting with the US as prime mover, has since begun painting India with the same Sri Lankan brush, when it comes to more recent allegations of non-war crimes human rights violations.

Under Modi especially, India has been moving slowly but surely to the centre-stage on the Sri Lankan ethnic issue.

It has more to do with competitive Sri Lankan Tamil politics over the non-acceptance of the India-facilitated power devolution package under the Thirteenth Amendment to the Sri Lankan constitution than New Delhi's security concerns of the China kind.

Then, there is the irreconcilable fishermen's dispute between the Tamil-speaking coastal population in the two nations.

It would continue to be a thorn in the flesh for both nations, but for starters, Colombo has to display a certain level of maturity in ensuring that the Sri Lanka Navy does not continually harass the Indian fishers crossing the IMBL, as it acts as a constant dampener to bilateral ties.

Non-regional diplomats posted in the two countries and also the international media are the culprit, but they should be given least opportunity in the matter.

Bilateral ties have three major impediments.

One, of course, is China, and the other two relate to the ethnic issue and the fishers' dispute, the latter bilateral in form and content.

Colombo has since sought to address the former.

The return of institutionalised foreign policy -- or the foreign policy returning to the institutional mechanism, to whatever extent possible under the circumstances -- has meant that Sri Lanka is able to articulate its India-China bi-polar approach in a better way than any time in the past.

In Delhi media interviews, Peiris reiterated that they would go to India, China, Bangladesh or any other bilateral partners first to address the forex and fiscal crisis, before considering the IMF.

It's not about the IMF's all-American character as often inadequately understood.

Though the minister did not explain it, the left-leaning leadership in Colombo is anxious to avoid politico-electoral unpopularity attending on IMF conditionalities nearer home compared to their populism.

To this, Sri Lankan street opinion may have now added Chinese usury, which was felt in every rural home, too, after the 'fertiliser scam'.

It was unlike the two Hambantota deals -- construction and swap -- and also the upcoming Colombo Port City, which were mostly urban politico-economic issues.

The China-funded projects mostly relate to urban or economic infrastructure, including the upcoming Colombo Port City and expressways that do not impact the vast rural population directly.

Over the past close to a decade, they have also been taking away Sri Lankan jobs in their millions, hence family incomes.

Colombo seems to have understood what is wrong with their China-centric economic policy, which has proved to be too costly for Beijing's uncomplicated political and diplomatic support at the UNHRC and the UN, if and when it's hauled up over there.

Against this, Indian projects, though infrastructure-related at present, are expected to massively boost domestic jobs and family incomes.

No one in Sri Lanka can dream of India demanding its territory in lieu of debt, or blacklisting a public sector bank for non-payment for substandard fertiliser, on the government's advice.

The message has to be taken across, but no one in Sri Lanka has any doubt that if the present forex/economic crisis were to continue for unforeseen reasons again, India would be as mean a lender, which anyway it has never been, given the concessional terms and the comforting hope of rescheduling as has happened now with two pending debts, totalling $ 900 mn, if it came to that.

There now seems to be greater clarity and acceptance in Indian government circles that they needed to take Colombo at its words, on 'development funds from all, strategic ties only with India'.

The coming months especially will (have to) provide evidence to this also to the Indian strategic community and to the larger world.

At some point, India also needs to re-evaluate unilateralism in defence and strategic affairs, without prior consultation or post facto information for smaller neighbours, on the nation's extra-regional defence and security pacts -- with the erstwhile Soviet Union during the Cold War and the US-led West, since.

The latest is the Quad, Indo-Pacific duo, where Sri Lanka seems to be moving closer to the EU-led Indo-Pacific, instead.

The EU initiative itself is a product of absence of prior consultation and later-day communication between the US and its European allies.

Clearly, Colombo seems to be veering to the middle path between China and the US on global matters, but in regional matters of strategic security, it is increasingly identifying with India, as it has been declaring through the past decade-plus-half but not as convincingly as at present.

There is a long way to travel together, but a new beginning has been made, after all!

N Sathiya Moorthy, veteran journalist, political analyst and author, is Distinguished Fellow and Head-Chennai Initiative, Observer Research Foundation.

Feature Presentation: Aslam Hunani/