Sri Lanka will start work next month on plans to develop an energy hub with India and the United Arab Emirates, the energy minister said on Friday, as the nation looks to leverage its strategic location to cement a recovery from a financial crisis.
The trio signed a deal to create the hub during a visit this month by India’s Prime Minister Narendra Modi, the first global leader to visit the island since President Anura Kumara Dissanayake took office last September.
Dissanayake won an election with pledges of stability after the worst financial crisis in decades three years ago triggered runaway inflation, sent the local rupee into free-fall and forced the country to default on $25 billion of debt.
The hub in the eastern harbour city of Trincomalee will involve the construction of a multi-product pipeline as well as bunkering facilities and potentially a refinery.
It will also include development of a World War II-era storage tank farm partly owned by the Sri Lankan subsidiary of Indian Oil.