China and Sri Lanka are working together to establish Sri Lanka as a key logistics hub in the Indian Ocean. Sri Lanka's strategic location allows for efficient global and regional connectivity. The country is investing in improving its ports, logistics services, physical infrastructure, and technology. Sri Lanka's economy has faced challenges, but it secured a $3 billion bailout from the International Monetary Fund to stabilize and restructure its debt. China has extended debt payment and pledged support for Sri Lanka's socioeconomic development. Additionally, a $392 million South Asia Commercial and Logistics Hub is set to be built in Colombo Port, further enhancing Sri Lanka's logistics capabilities.