HAMBANTOTA, a district capital 240 kilometres south of Colombo, is almost surreal. A small, sleepy town of around 11,000 souls, I have watched it acquire all the outward aspects of a large, modern city. It has a new port, an airport, a cricket stadium built to international specifications, a huge conference centre and a modern administrative complex. It is also surrounded by a cobweb of wide motorways and elevated roads.

The problem is that all these expensive structures are barely utilised. The city’s population is still 11,000, and it has no features to attract tourists. The development of the semi-arid region was ex-president Mahinda Rajapakse’s bizarre brainchild, and the current government has come up with an innovative way to pay back the Chinese for their help in creating this $1.4 billion white elephant.

The controversial deal negotiated with China Merchants Port Holdings will give the Chinese firm 80pc of Hambantota Port, while the Sri Lanka Port Authority (SLPA) will retain 20pc. Combined with this joint venture is an even more unpopular move to give the Chinese 15,000 acres of land around the city on a 99-year lease for an industrial zone.

The current employees of the SLPA are up in arms at the prospect of the Chinese takeover, and have staged several protests to prevent it from happening. One act of sabotage involved forcibly delaying a Japanese and a South African ship, sending insurance rates up.

The opposition, led by the socialist JVP, has led local farmers in their protest. Although most of the 15,000 acres to be handed over to the Chinese belong to the state, there are villages and farms included in the package. The government has offered to compensate these villagers with land elsewhere. Understandably, the locals are unhappy, and their cause is being supported, among others, by nationalist monks. Magama Mahanama of the Monks’ Organisation to Protect National Assets expressed fears of Hambantota becoming a Chinese colony. The protest turned violent when the prime minister and the Chinese ambassador came to witness the launch of the industrial zone.

Oddly, Rajapakse, the populist leader who created the whole mess to begin with for his political ends, has come out against the Chinese deal, insisting that he would have negotiated a better one. When he was in power, I recall asking a senior official in his planning cell how these extensive facilities would ever pay for themselves, given the low population in the area. He replied that the plan was to shift certain government departments from Colombo to force government employees to move to Hambantota. The reason for all this huge expenditure is that Rajapakse is from the area, and wanted to consolidate his grip. He remains popular in the south, and large posters bearing his grinning face are plastered on many walls.

In an effort to sell the joint venture, Ranil Wickramsinghe, the Sri Lankan prime minister, promised locals that the industrial zone would create many jobs. But watching how the port was built, I somehow doubt this. For one, there are few qualified people around, and secondly, the Chinese prefer bringing labour and managers from China. When the port was being built, I used to wonder why we didn’t see any Chinese workers in the area.

The reason became clear when we drove past pre-fabricated barracks behind a wire fence: prison workers had been brought in by the construction company from China, and they were taken to the construction site every morning and brought back in the evening. Hardly any locals were employed. I suspect this is what will happen once China Port Holding takes over. There’s a lesson here for those who think the China-Pakistan Economic Corridor will create a large number of jobs.

Already, the Chinese presence is more visible across the island. Many of the Chinese one sees are tourists, but a significant number are working and living here. It was thought that after Maithripala Sirisena defeated Rajapakse in 2015, the new government would distance itself from China and become closer to India. In fact, it is widely believed that RAW, the Indian intelligence agency, helped in putting together the victorious coalition.

But as the new government has discovered, Chinese loans and direct investments have penetrated deep into the economy. Thus, the ties forged by Rajapakse have proved hard to break, and in most cases, existing contracts have had to be honoured. Despite the local unrest caused by the Hambantota deal, most educated people accept the economic necessity of the joint venture.

The port and the other new facilities were always seen as a herd of white elephants with zero economic viability. And so it has proved. To provide the port with some activity, the government has decreed that all ships carrying cars should deliver them to Hambantota from where they are transported to Colombo by road. This has only raised prices. The airport is even more of a lost cause. The Economist’s correspondent once described the airport as having more lizards than passengers.

Several years ago, I went to see the Pakistan cricket team play against Kenya in a World Cup encounter at the new Chinese-built cricket stadium, and can confirm that there were far more security staff than spectators. Hardly any matches are played there, a situation unlikely to change unless the Chinese take up cricket. Similarly, the conference centre lies unutilised, and the modern motorways are empty. All in all, this is a classic case of building infrastructure for political, not economic, reasons.

As the Sirisena government heads into its third year in power, the threat of a Rajapakse comeback is very real. Given his enduring popularity, the government has continued to delay the local council elections on the grounds that the electoral boundaries have to be redrawn. But this ploy is fooling nobody: whenever these elections are held, Rajapakse’s anointed nominees are expected to do well, providing the government with a loud wake-up call.

irfan.husain@gmail.com

Published in Dawn, January 16th, 2017