Japan wants SL to pay for Termination of  light Rail

Japan wants SL to pay for Termination of light Rail

Japan wants Sri Lanka to pay for the termination of a $1.5-billion Japanese-funded light rail project.

Japan’s Finance Minister, Suzuki Shunichi has told Opposition Leader Sajith Premadasa and a delegation of the Samagi Jana Balawegaya (SJB) that Sri Lanka must pay for the cancellation of the project in order to resume stalled projects.

SJB MP Dr. Harsha de Silva said that the general message conveyed by the Japanese Finance Minister was for Sri Lanka to complete debt restructuring as soon as possible, not to jeopardise the IMF program and repay due for LRT cancellation in order to resume stalled projects.

Normally demands such as  compensation for unilateral terminations is a matter that needs be taken up with the government  and it’s not clear why the light rail issue has been taken for discussion with the opposition.

Former President Gotabaya Rajapaksa had ordered the termination of the $1.5-billion Japanese-funded light rail project, saying it is not a “cost-effective solution” for the congested capital Colombo.


Japanese technology including rolling stock was to be used on the rail system, which included 16 stations over 15.7 kilometres (9.8 miles).

Detailed planning and land acquisition for the project in Colombo, which has some of the worst traffic congestion in South Asia, had already been completed and initial construction was under way.

The Japanese loan carried an interest rate of 0.1 percent and was repayable over 40 years with a 12-year grace period. Japan had already funded sections of new expressways and a key bridge to reduce traffic congestion in and out of the capital
Sri Lanka President Ranil Wickremesinghe has apologised to the Japanese government for the unilateral cancellation of a Japan-funded 1.5 billion dollar light rail transit (LRT) project.
Wickremesinghe, who met Japanese Prime Minister Fumio Kishida in Tokyo in  May 2023.


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