Debt Trap

Despite the gossip, Sri Lanka and China seem to have a long future together.

By Salis Malik | May 2022

With Sri Lanka standing at the cusp of impending socio-economic doom, the Rajapaksa family that once ran everything in the country, now seems to have run out of money. With a country that has lost its foreign exchange, the Rajapaksa brothers now walk a diplomatic tightrope with China. From a neo-realistic perspective, the ensuing protests against President Gotabaya’s regime and the diplomatic tilt towards India’s orbit, has left many to speculate over Chinese ties with Colombo. For many, these developments seem to be the epicentre that might eventually leave a deep fault-line between Beijing's and Colombo’s diplomatic relations.

Sri Lanka has maintained close ties with Beijing ever since the end of the civil conflict between the Sinhalese Buddhist majority and Tamil separatists, back in 2009. It was during this time when Colombo required a very strong ally on the international front but countries like United States, India and other Western Powers did not want to partner with Sri Lanka amid human right allegations against them. The Sri Lankan leadership therefore tilted towards China and then began a decade which saw Chinese money rushing in the country as infrastructure development started to soar. Even though China has been Sri Lanka’s biggest source of foreign direct investment, when Gotabaya Rajapaksa came to power, his manifesto included forging ties with India and reiterating an “India First” policy. Therefore, in retrospect, one can reasonably infer that the most paramount reason for the supposed divide between China and Sri Lanka, could be Colombo’s sudden closeness to India. By viewing the external relations of Sri Lanka through the prism of Chinese diplomacy, one can easily see a sporadic phase shift in the external affairs of President Gotabaya’s regime, one that is riddled with a confused rhetoric of trying to balance the weight between Beijing and New Delhi. This has certainly been a very daunting task and one that seems to be tilted in favour of India and President Modi. Consequently, it was also President Modi who became Sri Lanka’s first state guest, after the Rajapaksa family gathered the reins of the government again.

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