Adani to Double Colombo Terminal Capacity Ahead of Schedule

22 Sep 2025 CW Team

India’s Adani Group and its partners are set to double the capacity of the $840 million Colombo West International Terminal months ahead of schedule, despite relinquishing $553 million in U.S. funding, according to an executive at partner firm John Keells Holdings.

The deepwater terminal, situated alongside a facility operated by China Merchants Port Holdings, highlights Sri Lanka’s strategic role in the contest for influence in the Indian Ocean between New Delhi and Beijing.

The first phase of the fully automated terminal became operational in April 2025. The second and final phase is underway and expected to be completed by late 2026, three to four months ahead of the February 2027 deadline, said Zafir Hashim, head of transportation at John Keells. Upon completion, the terminal will have an annual handling capacity of 3.2 million containers, boosting the overall throughput of Colombo Port.

The majority of business through the terminal originates from India. In December 2025, Adani withdrew its funding request from the U.S. International Development Finance Corp, opting to finance the project via internal accruals and a capital management plan. This followed allegations by U.S. authorities involving Adani Group Chairman Gautam Adani, which the group has dismissed as baseless.

Adani Ports and Special Economic Zone holds a 51 per cent stake, John Keells owns 34 per cent, and the Sri Lanka Ports Authority retains the remainder.

Despite withdrawing from two proposed $1 billion wind power projects earlier in 2025 after tariff disputes with Sri Lanka’s government, the country remains open to further renewable energy investments from Adani. Energy Minister Kumara Jayakody confirmed that Adani later explored two smaller 100 MW wind projects, signalling renewed interest, though no bids were ultimately submitted.

“Adani is performing very well in the West Terminal project, and we are very happy,” said Arjuna Herath, Chair of Sri Lanka’s Board of Investment.

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