An injection of Chinese and Indian money is helping rebuild Sri Lanka as it recovers from the 2004 tsunami and the 26-year Civil War with much of the rebuilding efforts focussed on the southern port of Hambantota, which is bidding against the Gold Coast in Australia to host the Games.

Zhang Dejiang, the Chinese Vice-Premier, is currently leading a delegation of 30 leading officials from Beijing on a visit to the capital Colombo where he will be discussing with Sri Lankan Government officials several major building projects in the country.

Dejiang has signed six agreements with President Mahinda Rajapaksa and Prime Minister DM Jayaratne including pacts on economic and technical cooperation, highways development, cooperation in information technology and communications, the development of maritime ports and the second phase of the Hambantota Port Development project, which they are pumping $200 million (£137 million) into.

There are already more than 2,000 Chinese labourers in Hambantota, the hometown of Rajapaksa, where they are building a vast deep water port.

The Port is the flagship project of the Hambantota District Development Zone, which is expected to be completed by 2020.



Since 2006, the Chinese Government has provided Sri Lanka $3.04 billion (£2.06 billion) in financial assistance.

A statement from Rajapaksa's office after the meeting with Dejiang said: "China reiterated its commitment to the economic development of Sri Lanka, with its investment and association with the major economic, infrastructure and socio-cultural development projects in the country."

India is opposed to China's involvement in the redevelopment of Hambantota for fears that Beijing is seeking it is an opportunity to establish secure bases for its navy in the Indian Ocean.

Sri Lanka claims that the opportunity to help redevelop Hambantota was offered first to the Indian Government.

But Rajapaksa last week returned from a visit to India where they discussed opening a Consulate in Hambantota as well as granting credit of up to $1.8 billion (£1.2 billion), including $800 million (£550 million) for the reconstruction of the country's railways so badly damaged in the War.

A decision on which city is due to host the 2018 Commonwealth Games is due at a meeting in St Kitts and Nevis in November 2011.

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