India offers credits to boost Sri Lankan economy, security

India offered a $400 million credit line to Sri Lanka for development of its infrastructure and economy during a visit by the island nation's newly elected president, Gotabaya Rajapaksa.

Rajapaksa thanked India for its assistance and said he will work with New Delhi to ensure that the Indian Ocean remains a zone of peace. India has been concerned about Sri Lanka leaning more toward China, which is seeking more influence in the Indian Ocean region.

India considers the Indian Ocean region to be its strategic backyard and is anxious about China's influence in Sri Lanka. Sri Lanka leased a Chinese-built port located near busy shipping routes to a Chinese company in 2017 for 99 years to recover from the heavy burden of repaying a Chinese loan the country received to build the facility. It is part of Beijing's plan for a line of ports stretching from Chinese waters to the Persian Gulf. In March, China agreed to provide a $989 million loan to Sri Lanka to build an expressway that will connect its tea-growing central region to the Chinese-run seaport on the southern coast.

The two leaders told reporters that they also discussed increased cooperation in countering terrorism. Since becoming prime minister in 2014, Modi has stressed a "neighborhood first" policy, promising nearby countries prioritized benefits from India's economic growth.