Sri Lankan Prime Minister Ranil Wickremesinghe met with Chinese ambassadors on Monday (May 14) when China announced that it has decided to approve granting Sri Lanka a loan of $1 billion for the construction of long-delayed expressway in the central region of Sri Lanka.

China has approved the $1 billion loan to Sri Lanka for revive construction of much delayed expressway that is located in central Sri Lanka. The construction of expressway’s first leg which connected Sri Lanka’s capital city Colombo with the hill resort of Kandy has been delayed since over two years due to lack of foreign funds. Looking into the matter, the Chinese decided to step up and approved to grant a loan worth one billion dollars for completion of the expressway in Sri Lanka. The announcement was made by Wickremesinghe’s office after he met the Chinese ambassador Cheng Xueyuan on Monday at Temple Trees in Colombo.

The loan will be provided to Sri Lanka through the Export-Import Bank of China once all administrative and legal formalities will be completed. The loan is yet another major spending form China in the loss-driven nation of Sri Lanka – in fact, China has emerged as the largest single lender to Sri Lanka in recent years. The Chinese has helped Sri Lankan government with completing project contracts to build roads, railways and ports under the former government of Mahinda Rajapakse. The $1 billion loan is one of the biggest investments made by China in Sri Lanka, after the $1.1 billion deal to take over Sri Lanka’s southern side on lease for 99 years; and the controversial $1.4 billion land reclamation project next to Colombo’s harbour.

China’s keen interest in the island nation of Sri Lanka has its own strategic, defence as well as diplomatic interests that mostly includes making its presence in the Indian Ocean. Colombo, being the key hub for Indian cargo transportation into the Indian Ocean, is the key interest for China due to which it has bolstered its contribution in developing facility in Sri Lanka. With deeper economic relations with Sri Lanka, China can improve alliance with the country and counter the rise of its rival strategically and secure its economic presence in the Indian Ocean – a well-thought investment, indeed.