China’s satellite tracking vessel Yuan Wang 5 has arrived at Sri Lanka’s southern Hambantota Port, despite India and the U.S. voicing concern with Colombo over the military ship’s visit.

In a recent incident on November 2022, another vessel ‘Yuan Wang 6’ had entered the Indian Ocean Region (IOR) coinciding with a planned Indian missile launch, but the launch was then deferred.

Hambantota Port:

• Hambantota International Port Group is a Public Private Partnership and a Strategic Development Project between the Government of Sri Lanka and China Merchants Port Holdings (CMPort).

Why is China’s Presence in Sri Lanka a Concern for India?

• Recently, China’s presence in Sri Lanka has increased on a large scale.
  • China is the largest bilateral creditor to Sri Lanka.
  • Sri Lanka heavily relies on Chinese credit to address its foreign debt burden.
  • China has invested about USD 12 billion in Sri Lanka’s infrastructure projects between 2006-19.
  • China enjoys friendlier waters in South Asia and the Indian Ocean than it does in Southeast Asia and the Pacific.
• Challenges in front India:
  • Sri Lanka has decided to establish a Special Economic Zone around the Colombo port city and a new economic commission, to be funded by China.
  • The Colombo port handles 60% of India’s trans-shipment cargo.
  • Leasing of Hambantota and the Colombo Port City project makes it almost certain for the Chinese navy to have a permanent presence in the Indian Ocean which will be worrisome for India’s national security.
  • This Chinese strategy to encircle India is referred to as the Strings of Pearls Strategy.
  • Other South Asian nations like Bangladesh, Nepal and the Maldives have also been turning to China to finance large-scale infrastructure projects.

What should be India’s Approach Moving Forward?

• Preserving Strategic Interests:
  • Nurturing the Neighbourhood First policy with Sri Lanka is important for India to preserve its strategic interests in the Indian Ocean region.
• Taking Advantage of Regional Platforms:
  • Platforms like the BIMSTEC, SAARC, SAGAR and the IORA could be leveraged to foster cooperation in fields like technology-driven agriculture, marine sector development, IT & communication infrastructure etc.
• Restraining Chinese Expansion:
  • India will need to continue to work on the Kankesanturai port in Jaffna and the oil tank farm project in Trincomalee to ensure that China does not make any further inroads in Sri Lanka.
  • Both countries can also cooperate on enhancing private sector investments to create economic resilience.
• Leveraging India’s Soft Power: Many organizations can create thousands of direct and indirect jobs and boost the island nation’s service economy.

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