The Chinese and Sri Lankan governments are set to discuss the progress of Colombo Port City project, which is a planned offshore city in Sri Lanka.

Valued at $1.4bn, the China Communications Construction Co (CCCC)-funded project was scheduled to be launched on 17 September 2014 by the then Sri Lankan President Mahinda Rajapaska and the Chinese President Xi Jinping.

Under the terms of the agreement between the respective governments, the Chinese developers were due to buy 20 hectares of freehold land under the Port City project.

"China is willing to help Sri Lanka to improve the infrastructure, bring in more employment opportunities and improve the wellbeing of all Sri Lankans."

However, under the new leadership of Sri Lankan President Maithripala Sirisena, the project remained under review until recently, citing lack of necessary permits and approvals.

According to CCCC, the shutdown of the project would result in losses of more than $380,000 a day, reported Reuters.

Chinese Ministry of Foreign Affairs division Director and Counsellor Chen Feng was quoted by media sources as saying: "The most important factor is to enhance the mutual understanding between the two countries. I think the two governments are now gradually working towards coming back to the normal track and all the projects will restart soon.

"China is willing to help Sri Lanka to improve the infrastructure, bring in more employment opportunities and improve the wellbeing of all Sri Lankans."

Last month, the Sri Lankan Cabinet agreed to appoint a new committee to address the issues of the Port City project following a recommendation by Ports and Shipping Minister Arjuna Ranatunga, marking the recommence of the project, reported Xinhua News.

The government announced last week that the project’s supplementary Environmental Impact Assessment study was submitted to Coast Conservation and Coastal Resource Management Department.