Hambantota International Port Group (HIPG) expects a sustained return of container shipping through the Red Sea and Suez Canal to create new commercial opportunities for the Sri Lankan port, as it prepares to expand its container handling capabilities.
The port operator believes that the restoration of the established East–West shipping corridor could strengthen Hambantota’s position in regional transshipment networks, while supporting demand for bunkering, ship supplies and other marine services.
The outlook follows an October 2026 assessment by maritime consultancy Linerlytica, which forecasts a full-scale return of container shipping to the Suez route by the first quarter of 2027. However, the pace of any recovery remains dependent on security conditions and individual shipping lines’ operational decisions.
Located approximately ten nautical miles from the main East–West shipping route, Hambantota is seeking to capitalise on its geographical position as carriers reconsider diversions around the Cape of Good Hope.
According to HIPG, disruptions in the Red Sea initially accelerated the development of Hambantota’s container transshipment business, as congestion at the Port of Colombo created demand for additional handling capacity.
The port began accommodating overflow cargo in April 2024 and launched its inaugural MSC container transshipment service on April 9 of that year.
“The Red Sea disruption advanced our container project. Congestion in Colombo Port created a requirement for additional capacity, and we began accommodating overflow cargo with the resources available to us in April 2024,” said Bindu Ranasinghe, General Manager – Commercial and Marketing at HIPG.
“That experience encouraged us to proceed with a full-scale operation and further investment. With expanded capacity coming into place, we welcome the prospect of shipping returning more fully to the Suez route,” Ranasinghe added.
As part of its expansion programme, HIPG has committed US$149 million to new container handling equipment, with annual container handling capacity targeted to reach two million TEUs during the first quarter of 2027.
The company expects that a sustained return to the Suez corridor could make Hambantota more attractive to shipping lines operating between Asia and Europe.
“When vessels use the established East–West route through Suez, they pass much closer to Hambantota. We have used the period of disruption to expand our capabilities, and a sustained return to that route would give us a stronger opportunity to attract business,” Ranasinghe said.
Beyond container transshipment, HIPG anticipates additional opportunities in bunkering and vessel support services as more shipping activity potentially shifts back towards the traditional route.
HIPG is also seeking to diversify Hambantota’s container business by developing gateway cargo for Sri Lankan importers and exporters, alongside its existing transshipment operations.
The port’s industrial park, nearby Board of Investment zones and proposed industrial developments are expected to support the establishment of a domestic cargo base.
A planned container inspection centre is intended to facilitate gateway operations, with benefits anticipated from the first quarter of 2027.
“To attract more shipping lines and services, we also need gateway cargo,” Ranasinghe said. “Industrial development within and around the port, together with the inspection facilities we are establishing, will help create the conditions for that business to grow.”
Meanwhile, HIPG is assessing the longer-term potential of alternative cargo connections developed during disruptions affecting access to ports in the Persian Gulf.
Hambantota has handled transshipment cargo for onward feeder services to accessible regional ports, providing alternative arrangements for shipping lines and their customers.
Although improved access to Gulf ports could lead some cargo to return to previous routes, HIPG believes that existing commercial commitments, service networks, insurance conditions and security considerations will influence future decisions.
“Shipping lines and their customers have established alternative arrangements, and those networks will not necessarily change immediately,” Ranasinghe said.
The company maintains that connections established through Hambantota could remain commercially relevant even as regional shipping conditions improve.
HIPG’s broader strategy is to combine container transshipment, gateway cargo, industrial development and marine services to establish a more diversified business as shipping networks across the region evolve.
