The country’s growing strategic ambition in the IOR can no longer be underplayed

Sudeep Chakravarti

If there was any lingering doubt about the strategic importance of Sri Lanka in the Indian Ocean Region (IOR), that doubt has surely been dispelled since the beginning of avoidable hostilities between the United States (US) and Iran in end-February 2026, and the consequent choking of the Strait of Hormuz. A seemingly endless queue of merchant shipping was strung off the coast of Sri Lanka’s southwestern city of Galle all the way up to Colombo, more than a hundred kilometres to the north. And beyond. Most vessels waited for a window of opportunity to sail up to Hormuz — not necessarily to enter the expanding and increasingly busy Colombo port.

The chokepoint at Hormuz has since eased a little. Even so, Sri Lanka’s importance as a waystation remains underscored.

On a visit to Colombo in September 2026 to attend a regional maritime conference, I sensed yet again that Sri Lanka has thrown its weight behind a maritime future. And that, it is attempting, despite bureaucratic bottlenecks, to knit a commercial and security architecture that seeks to both ensure and insure this future.

There remain insecurities, of course — both for Sri Lanka and its neighbours — but first, a brief overview.

Colombo port, which lives on transshipment clocked 8.29 million TEU (or twenty-foot equivalent unit, a container) in 2025, a six-plus percent growth over the previous year — operating at more than its current capacity. While Sri Lanka Ports Authority (SLPA) remains the umbrella organisation, the operations are a mix. For instance, South Asia Gateway Terminals or SAGT provides port services.

Colombo International Container Terminals (CICT) is the biggest on the block, based in the expanded southern harbour, a major deep-water facility that can hold ultra-large container vessels. CICT is primarily China-owned: China Merchants Ports Holding Company Ltd (or CMPH) has 85 percent shareholding with SLPA holding the remainder. This is at the northern edge of the massive port city, a work-in-progress reclamation project that now extends south all the way to Colombo’s landmark Galle Face Green. The port city project is being built by local subsidiary of China Harbour Engineering Company, which in turn is a subsidiary of the state-owned China Communications Construction Company.