Sri Lanka Hopes India Will Buy Into Airport Without Planes. China Refused

Sri Lanka has already sold China a port that gets almost no ships. The island nation now wants India to take control of an airport with no scheduled flights.

The nation first tried to offer China the Mattala Rajapaksa International Airport in the southern district of Hambantota, but is now in talks with India, Prime Minister Ranil Wickremesinghe told Sri Lanka's parliament on Thursday. The move follows the $1.1 billion sale of the loss-making port in Hambantota to state-owned China Merchants Group.

The efforts are part of Sri Lanka's attempt to salvage loss-making projects built under a previous administration criticized for its close ties with China. Hambantota's port was a "white elephant" that accumulated nearly $300 million in losses since 2011, Wickremesinghe told parliament. But the port's sale to China was a "great victory" for Sri Lanka, he said, and getting Indian involved in the airport could help revive that asset too, he added.

"Just like the port without ships, there is also an airport without planes in Mattala," Wickremesinghe told lawmakers. "We spoke first to the Chinese about the Mattala airport, but we did not get a favorable response. So we are in discussions with India. In the future, I believe Mattala will also be an airport free of debt that will attract flights."

Joint Venture

India and Sri Lanka held talks this week to discuss a joint venture agreement for the airport with Indian officials, the country's deputy transport minister Ashok Abeysinghe told parliament this week, according to Sri Lanka's EconomyNext news service.

The airport deal could take the shape of a 40-year joint venture in which India takes a 70 percent stake in Mattala airport, according to the Daily FT, a daily financial newspaper in Sri Lanka.

Spokesmen for India's civil aviation and foreign ministries could not be reached, while spokesman J.B. Singh of the Airports Authority of India said he could not comment.

China Concerns

Both projects were built in an era when former President Mahinda Rajapaksa was taking billions of dollars in Chinese loans to build infrastructure projects in Hambantota, where his constituency is located. By the time Rajapaksa was ousted from power in 2015, more than 90 percent of Sri Lanka's total government revenue was going toward debt payments.

China's investments have also prompted worries in New Delhi, Washington and Tokyo about the growing spread of President Xi Jinping's $500 billion Belt and Road infrastructure initative.

The airport in Mattala was infamous for having just one scheduled daily flight. But that flight, operated by FlyDubai, was canceled from June 8, the company said in an emailed statement.