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The Hambantota Port Concession Agreement: Understanding the Key Players and Implications

The Hambantota Port Concession Agreement, signed between the Government of Sri Lanka and China Merchants Port Holdings, has been making headlines since its inception in 2017. The agreement allows the Chinese company to operate and manage the port for a period of 99 years, in exchange for a lease payment of $1.12 billion. While the agreement has been hailed as a major investment in Sri Lanka’s infrastructure, it has also been criticized for its potential long-term implications.

Understanding the Key Players

The Hambantota Port, located on Sri Lanka’s southern coast, is a strategic point of interest due to its proximity to major shipping routes and the Indian Ocean. The port was built with Chinese investment of over $1 billion, as part of a larger infrastructure plan called the Belt and Road Initiative (BRI). The BRI is a Chinese-led project that aims to create a network of land and sea routes connecting China to Europe, the Middle East, and Africa.

China Merchants Port Holdings (CMPH), the company that now operates and manages the Hambantota Port, is a state-owned enterprise that is one of the largest port operators in the world. It has been expanding its global presence through acquisitions and partnerships with other port operators, and the Hambantota Port is a key addition to its portfolio.

Implications of the Concession Agreement

The Hambantota Port Concession Agreement has been met with both praise and criticism. Supporters argue that the agreement will bring much-needed investment to Sri Lanka’s infrastructure and boost economic growth. It is expected to create jobs and generate revenue for the government, as well as attract more shipping traffic to the region.

Critics, however, have raised concerns over the long-term implications of the agreement. One of the main criticisms is that the lease period of 99 years is too long. This has raised questions about Sri Lanka’s sovereignty over its own territory and the potential for Chinese influence to grow over the years. In addition, there are concerns that Sri Lanka may not be able to repay the lease payment in the designated time frame, which could result in a loss of control over the port.

Another concern is the impact of the agreement on the local community. The construction of the port displaced many local residents and fishermen, who lost their access to the sea. There are also fears that the agreement will lead to the expansion of industrial activities around the port, which could harm the environment and affect the livelihoods of those living in the area.


The Hambantota Port Concession Agreement represents a major investment in Sri Lanka’s infrastructure, but it also raises important questions about the long-term implications of Chinese investment in the region. While the agreement has the potential to bring economic benefits, there are concerns over issues such as sovereignty, debt repayment, and environmental impact. As Sri Lanka moves forward with the agreement, it is important to consider these issues and ensure that the interests of the local community and the country as a whole are protected.