Hambantota: Art of using old tricks to get new land

It was all over by last April. Hambantota, a then eight-year-old port on the coast of Sri Lanka, was already abandoned. According to the many reports published in newspapers and online, wild animals roamed the place and no ships docked. What had been built by man was fast being overtaken by nature and the wild beasts that had been displaced to make home for the promises that had once been attached to the port were taking up their prior positions.

There had been many of these promises; they included, for instance, the calculation that the 60,000 ships that sailed past the port every year on the Indian Ocean would stop to unload their cargo — were such an option be available. Sri Lanka, understandably eager to join the ranks of the giants — Singapore and Dubai — whose glories all of Asia sings, brought the vision. They, too, could be a part of the glorious ranks of the world shipping business.

China was there to help make it all happen and then Sri Lankan leader Mahinda Rajapaksa was glad to accept. China Harbour Engineering Company Ltd, China's largest government-owned enterprise, was the one to dole out the dollars. At first the terms of the debt were moderate. However, as time passed and as some of the predictions regarding the unfeasibility of the port seemed to crawl towards the truth, the conditions of the debt became stricter.

The fault of the failure of Hambantota did not lie squarely with the Chinese. Feasibility studies conducted by independent organisations had long shown that the golden promise of rivalling Malaysia and Singapore was a castle in the air that is much harder to theorise than to realise. But Rajapaksa had an election to win and the loans rolled in with the regularity with which he requested them, often at convenient interludes during the campaign.

Things that are being built have the curious propensity of being amenable to a thousand dreams and Rajapaksa, ever soft to sycophants, listened to and believed in the glorious visions that cranes and construction equipment could embolden and engender. The cranes stood tall over the sites and the many containers that would one day be loaded and unloaded off the ports seemed very close — and with them, the dream of a new and far more empowered Sri Lanka.

Except they never came. The thousands of ships that had been sailing by on the Indian Ocean continued to do just that: sail by. Hambantota was unable to attract them to its shores, tempt them with its wares and facilities, all of which had been built with Chinese money. At first there were calls for patience, the usual sorts of hems and haws that suggest that great things take time and this certainly was going to be a great thing.

The problem was that this great thing had not taken very long to build or visualise, nor to grow indebted to; it had been built fast and quick with borrowed money. A port that was supposed to be the key to the future of Sri Lanka was lying empty, its docks unloading nothing, its berths holding no passing ships. In 2012, Hambantota saw only 34 ships.

The Chinese waited a bit, the Sri Lankans began to default. Rajapaksa was voted out of office and things did not look like they were going to improve. The Sri Lankans were looking to restructure their debt. The port, as mentioned, was lying empty with the lush Sri Lankan forest that lay around it claiming it for its own.

In the end, Sri Lanka agreed to lease out the Hambantota port and an additional 15,000 acres of land to China in a 99-year lease. For that period of time, China would operate and control the port. And indeed, as soon as China did that, ships — of which China operates many — began to dock at the Hambantota port. What had been a spooky and desolate place began to hum with activity and, most importantly, with the sounds of ships coming in and heading out.

The devil always lies in the detail, and the story of Hambantota is no exception. In its ambitious new Silk Roads plan, the Chinese are investing hundreds of millions of dollars in infrastructure projects all around the world. Not all of them are even actual sea ports; an investigative report in The New York Times reported a similar large-scale deal on the border between Kazakhstan and China to build a dry port. The claims there are just as grand as those in Hambantota. Once constructed, this will be (they say) the busiest dry port in the world, connected by dizzying array of rail lines and moving all sorts of things on an international super-highway of goods.

Of course, that too could end up just like Hambantota. The port could be built with money borrowed from China and then put into operation by the hopeful Kazakhs whose ambitions have been made loftier by the brisk business being conducted in a small visa-free corridor between the two countries. Unlike Hambantota, the Kazakh dry port has not yet failed (although it does seem a bit desolate even while under construction) but if it does, it could well be that the Kazakhs have to strike a similar deal as the Sri Lankans — give over their territory because they cannot pay their debts.

In the age of budget deficits and huge debts carried by nearly every country, the seriousness of debt and the consequences that can come of it are not popular in discussion. Colonial history, when territory was similarly bought and sold, seems a long way away and the fact that the British purchased the subcontinent largely via debt defaults has largely been forgotten. In the meantime, new overlords who have read history can take advantage of its unpopularity and use old tricks to buy new land.

By arrangement with Dawn