Hambantota International Port Group (HIPG) has significantly expanded operations at the Hambantota International Port (HIP) in response to a surge in global shipping volumes driven by the ongoing crisis in the Middle East. The move further strengthens the port’s position as a key alternative hub along the vital East–West maritime corridor.
Port authorities confirmed that HIP has doubled its Roll-on/Roll-off (RoRo) yard capacity while increasing container yard capacity by 30%. This expansion comes as global shipping lines divert operations away from disrupted Middle Eastern routes in search of more stable and efficient alternatives.
The surge in activity has pushed yard utilisation to record levels, reflecting a sharp rise in vehicle transshipment volumes alongside increased container traffic.
HIPG CEO Wilson Qu noted that these developments point to a broader shift in global shipping dynamics. He emphasised that the port has focused on building both capacity and operational agility to respond effectively to changing trade patterns, highlighting its strategic location as a key advantage for shipping lines prioritising reliability.
Situated just 10 nautical miles from the main East–West shipping route, HIP allows vessels to divert with minimal deviation, helping maintain schedules amid ongoing disruptions.
To support the increased throughput, the port rapidly expanded yard space across both RoRo and container segments. Officials said the upgrades were completed within a short timeframe despite the technical and operational challenges of working within an active port environment.
The expansion required close coordination between management, engineering, and operations teams, alongside significant investment to ensure efficiency was maintained and congestion minimised during the upgrade process.
Port officials attributed the rise in volumes largely to geopolitical tensions in the Middle East, which have disrupted traditional shipping routes and increased demand for alternative transshipment hubs across the Indian Ocean region.
The latest capacity enhancement underscores Hambantota International Port’s growing role as a resilient logistics platform, positioning it to capture a larger share of regional transshipment volumes while supporting the continuity of global supply chains.
Inflation Edges Up as Credit Growth Expands, External Pressures Persist
Central Bank of Sri Lanka’s weekly economic indicators for the week ending April 2, 2026, present a mixed macroeconomic outlook, marked by a slight rise in inflation, continued expansion in private sector credit, and ongoing external sector pressures.
According to the “Highlights of the Week” report, headline inflation—as measured by the Colombo Consumer Price Index (CCPI)—accelerated to 2.2% in March 2026, up from 1.6% in February. Food inflation remained relatively subdued at 0.7%, while non-food inflation rose to 2.9%. Core inflation also increased to 2.5%, indicating underlying price pressures within the economy.
In the real sector, the Purchasing Managers’ Index (PMI) for construction recorded a month-on-month expansion in February, suggesting gradual recovery in activity. However, global oil price volatility—driven by geopolitical tensions in the Middle East—continued to influence domestic economic sentiment, with prices fluctuating before ending the week higher overall.
Monetary conditions showed signs of tightening. The Weekly Average Weighted Prime Lending Rate (AWPR) rose by 58 basis points to 9.86%, while the Average Weighted Call Money Rate edged up to 7.63%. Broad money supply expanded by 11.9% year-on-year in February, supported by strong private sector credit growth, which increased by Rs. 144.4 billion, reflecting a 26.4% annual rise.
Credit to public corporations also increased, while net credit to the government declined during the period. Market liquidity remained in surplus but narrowed compared to the previous week. In the fiscal sector, Treasury bill and bond yields stayed largely stable, although foreign investor holdings in government securities fell by 3.35%, and secondary market activity contracted due to a shorter trading week.
The external sector continued to face pressure, with the Sri Lankan rupee depreciating by 1.7% against the US dollar so far this year. The trade deficit widened to USD 1.43 billion in the first two months of 2026, as imports grew faster than export earnings. Gross official reserves were estimated at USD 7.27 billion by end-February.
Overall, the data points to a cautiously recovering economy, supported by improving domestic activity but constrained by inflationary pressures and persistent external imbalances.
HIP Expands Capacity Amid Surge in Global Shipping Volumes
