Colombo’s critical maritime hub is undergoing an accelerated transformation as India’s Adani Group and its partners are set to double the capacity of the West International Terminal months ahead of schedule. This rapid development highlights Sri Lanka’s geopolitical significance amid intensifying regional competition for influence, even as the project navigated a significant financial shift.
The $840 million deepwater terminal, primarily a venture of Adani Ports (51%) and John Keells Holdings (34%), began its first operational phase in April. Its final phase is now slated for completion in late 2026, ahead of the February 2027 deadline, significantly boosting annual capacity to 3.2 million containers. This project, positioned adjacent to a Chinese-operated facility and serving substantial Indian business, underscores Sri Lanka’s critical geopolitical role in the India-China rivalry for influence in the Indian Ocean.
A key financial adjustment involved Adani Group withdrawing its $553 million funding request from the U.S. International Development Finance Corporation (DFC) in December, opting for self-financing through internal accruals. This decision followed unproven bribery allegations by U.S. authorities against Adani Group Chairman Gautam Adani, which the group vehemently denies. Despite this scrutiny, co-investor John Keells Holdings has publicly affirmed Adani’s reliability, ensuring the project’s continued development.
Beyond the port, Sri Lanka is actively exploring further renewable energy investments with Adani Group. However, this ongoing engagement follows earlier friction in February, when Adani withdrew from two proposed $1 billion wind power projects. That decision came after the new administration of President Anura Kumara Dissanayake sought to renegotiate power purchase rates, reflecting the complex dynamics of foreign direct investment in the current economic climate.
Sophia Patel brings deep expertise in portfolio management and risk assessment. With a Master’s in Finance, she writes practical guides and in-depth analyses to help investors build and protect their wealth.