By: Staff Writer
July 14, Colombo (LNW): East Container Terminal restructuring aims to boost competitiveness despite construction setbacks and governance concerns
In a strategic move aimed at streamlining operations and enhancing competitiveness, the Sri Lanka Ports Authority (SLPA) has announced the establishment of a new fully state-owned company, Colombo East Container Terminal (Pvt) Ltd, to manage the East Container Terminal (ECT) of the Colombo Port. This decision was formally approved by the Cabinet following a proposal by the Minister of Highways, Ports, and Civil Aviation.
The SLPA stated that the restructuring is designed to improve the efficiency and management of ECT operations, enabling it to compete with private terminal operators such as SAGT (South Asia Gateway Terminals) and CICT (Colombo International Container Terminals). The move follows mounting pressure on the SLPA to modernize its operations, especially amid growing global container traffic and the increasing importance of Sri Lanka as a transshipment hub in the Indian Ocean.
The East Container Terminal, considered one of the most strategically located deep-water terminals in South Asia, has the capacity to accommodate ultra-large container vessels (ULCVs). However, its development has been riddled with controversy, delays, and construction irregularities since its partial handover was reversed in 2021 after public and political backlash against foreign participation—particularly Indian and Japanese investment.
Despite its potential, ECT remains underutilized compared to its private counterparts. While the nearby Jaya Container Terminals (JCT) continue to handle mostly feeder vessels due to depth limitations, ECT’s development was meant to position the SLPA to handle larger mainline ships directly. The recent announcement signals an attempt to revive that ambition by giving ECT a separate management structure under government control.
However, industry analysts and maritime experts have raised concerns over the efficiency of a purely state-run model. “Simply setting up a company is not enough. There must be clear timelines, accountability frameworks, and commercial independence,” a senior logistics consultant told The Sunday Times. There have also been unconfirmed reports of irregularities in procurement processes, contractor selections, and project cost escalations since construction resumed in 2021 under full SLPA control.
According to the SLPA’s most recent data, construction at ECT is behind schedule, with key infrastructure including cranes and automation systems yet to be fully installed. The delay is contributing to congestion risks and missed opportunities, especially as regional ports like Mundra and Dubai aggressively expand their capacity.
The reorganization could provide a lifeline for the ECT project, but unless transparency improves and technical bottlenecks are addressed, it may face the same fate as several other state-run infrastructure projects—burdened by red tape and inefficiency.
