The Hindu Business Line : Land bridge to Lanka to cost $500 million

THE pet project of the Sri Lankan Prime Minister, Mr Ranil Wickremesinghe, to build a land bridge between Sri Lanka and India, is getting concretised with the Board of Investment (BoI) of Sri Lanka being given the assignment to draw up plans for this project, and a foreign builder might get the project likely to cost around $500 million, the BoI Chairman and Director-General, Mr Arjunna Mahendran, told Business Line in an interview on Thursday.

"We are very excited about this project and have already done a preliminary pre-feasibility conceptual study for this bridge between Thalaimannar to Dhanushkodi and then on to Rameshwaram. That was the original ferry link between the two countries that was discontinued after the war started.

"He said that with the Indian and Sri Lankan Prime Ministers issuing a statement in their joint communiqué following their meeting in December 2001, that they would proceed with this project, the matter is official. The BoI's study on the 22-km link over shallow sea, estimates the cost at around $500 million.

"It is not bad as bridges go. You have similar bridges connecting the Island of Penang to the Malaysian mainland. Lots of interest has come from bidders all over the world; from UK, Hong Kong and Singapore. They have all expressed keen interest. Of course the two governments have to further discuss this matter," Mr Mahendran said.

Even though it would be an Indo-Sri Lankan project, India has agreed to the involvement of a third country in the construction of the bridge, "given the magnitude of the financing and the fact that they might have superior construction techniques in this type of activity. The Singapore Government for instance, in their construction wing, the Jurong Town Corporation, has a lot of experience in reclaiming land from the sea and this project too involves that," he said.

The depth of the water is only about six metres at the deepest point of the proposed land bridge. "So you just have to reclaim that land, put a platform on it and a highway and you're done." Once the work begins it should be completed in three years, is the BoI's estimate. In the meantime, and before even construction of this road begins, the two governments hope to start a ferry service between the two points. "We hope we can start it by September and already the two governments have started a dialogue on this," he added.

As for Indian interest in investing in Sri Lanka, manifested during the BoI delegation's visit to India last week, Mr Mahendran said that a direct result of the peace initiative undertaken by the Wickremesinghe Government had been an increase in Indian interest to invest in Sri Lanka. The delegation visited Mumbai, Chennai and Bangalore, got good response and he is confident that at least five projects will be up and running by the end of this year.

These pertain to the manufacture of precision wires which go into automotive components; refining of raw, unprocessed dhal which is consumed in large quantities in Sri Lanka and which is now being imported from India and Turkey; manufacture of coking coal which will also provide power to the national grid in Sri Lanka and also a proposal from a lubricant company to refine used lubricant oils and reconvert them into a commodity.

There has also been interest in quite a few projects for the processing and purification of waste metal; copper, zinc, lead, etc, which would be processed and purified into ingots for re-export back into the Indian market.

"It's a popular area but we're reluctant to accept too many such projects because of environmental issues related to smelters," he added.

But of greater interest to both the countries is the interest shown by Indian software companies to explore opportunities in Sri Lanka. "We've had 15 proposals already from Indian IT companies and it's a question of finding them the infrastructure and the telecom facilities to establish their operations in SriLanka," Mr Mahendran said.

Tata Infotech has shown interest and ICICI's IT operations wing wants to take up work with Sri Lanka's banking sector. A huge opportunity for Indian IT companies would be in the area of Sri Lanka's e-governance.

"There is a huge need to develop e-governance in Sri Lanka. This is another area that had been grossly neglected by the past regime. We don't have any of the Government functions properly computerised at the moment and in that sense we are really lagging behind India. It's a huge drawback. Our Ministry of Finance doesn't have a proper budgeting process that has been computerised adequately. We're supposed to be a hub port for the sub-continent in Colombo but we still haven't got our clearance of shipping documents online; that is something we are looking at fast tracking in the next three of four months because it impinges on the work of the BoI directly."

Then there is the area of registration of persons and motor vehicles and not only the Tata group but also other international companies had evinced interest in this huge area of operations. "This is a country of 19 million people and the sky is the limit. For instance the port computerisation project I mentioned would link up customs, the BoI, banks and the freight companies along with some of the larger importing and exporting houses, and that project alone will cost in the region of $30 million."

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