India-Russia joint venture to manage strategic Sri Lanka airport

A joint venture between an Indian and a Russian firm has won the contract to manage Sri Lanka's Mattala Rajapaksa International Airport for 30 years. The airport is near Hambantota, where China operates a port on lease.

The airport, built at a cost of $209 million, was once dubbed the "world's emptiest airport" because of a lack of flights. It is strategically located close to the Hambantota port on the southern coast of Sri Lanka.

This will be the second India-Russia joint project in India's neighbourhood, after the Roopur nuclear power plant in Bangladesh. While Russia is constructing the power plant, India is assisting with training of locals and certain logistics.

The Sri Lankan Cabinet had on January 9 decided to call expressions of interest for the contract to manage the airport, government spokesman and minister Bandula Gunawardena told reporters in Colombo on Friday. Five proposals were received, and a Cabinet-appointed consultative committee recommended that the management contract be awarded to the JV of Shaurya Aeronautics (Pvt) Ltd of India and Russia's Airports of Regions Management Company, Gunawardena said. The Cabinet approved the recommendation.

The Mattala airport was one of the major infrastructure projects of Mahinda Rajapaksa's nearly decade-long rule of the island nation. The Lankan government had since 2016 been looking for commercial partners to manage the airport as it was making heavy losses.

The airport, constructed with financing from the Export-Import Bank of China, has faced challenges since its inauguration in 2013, including minimal flights and environmental concerns. Sri Lanka is in talks with the EXIM Bank to restructure the loan associated with the airport.