Hambantota Port in Talks with UAE Giant Al-Futtaim to Build Gulf Vehicle Supply Chain Hub

Sri Lanka's Hambantota International Port is in preliminary discussions with Dubai-based conglomerate Al-Futtaim Group to explore potential collaboration on establishing vehicle supply chain linkages between the Gulf region and the strategic southern port, officials have confirmed.

A Strategic Opportunity for Hambantota

The talks signal growing interest from prominent Gulf business interests in leveraging Hambantota's geographic position along major international shipping lanes. Al-Futtaim, one of the Middle East's most diversified business groups with significant interests in automotive distribution across the region, is exploring how the port could serve as a node in a broader vehicle logistics network connecting Gulf markets.

Hambantota International Port, majority-managed by China Merchants Port Holdings under a long-term lease agreement, has been actively seeking to attract new business verticals to justify its development and boost Sri Lanka's foreign exchange earnings. Automotive logistics represents one such high-value opportunity.

What the Partnership Could Mean

If formalised, an arrangement with Al-Futtaim could position Hambantota as a transhipment and processing hub for vehicles moving between Gulf assembly and distribution points and broader Asian and African markets. Such a development would bring:

• Increased port activity and vessel calls at Hambantota
• Employment opportunities in vehicle processing and logistics services
• Potential foreign direct investment into port-adjacent industrial zones
• Stronger trade ties between Sri Lanka and UAE-based commercial entities

Broader Context

Sri Lanka has been intensifying efforts to attract investment and develop its port infrastructure as part of its economic recovery following the 2022 financial crisis. Hambantota, often cited in the past for underutilisation relative to its capacity, has been repositioned as a complementary port to Colombo, targeting bulk cargo, industrial logistics, and niche supply chain functions.

Al-Futtaim Group operates across automotive, retail, real estate, and financial services sectors in over 20 countries, making it a significant potential partner for Sri Lanka's port development ambitions.

Officials have not yet disclosed a timeline for when negotiations might conclude or whether a formal memorandum of understanding is being drafted. Both parties are understood to be in the exploratory phase, assessing commercial viability and operational frameworks before committing to any binding agreement.

The development will be closely watched by investors and policymakers alike, as Sri Lanka continues to push its ports and maritime sector as key pillars of long-term economic growth.