A Chinese company says it will resume construction work on a $1.5 billion port city project that was suspended for one year due to questions over environmental impact.

CHEC Port City Colombo issued a statement Tuesday welcoming the Sri Lankan government's decision to allow the project to resume. It said a supplementary environmental impact study was done to fully assess the project's impact and mitigation.

The city is to be built on reclaimed land off Sri Lanka's west coast and include a golf course, marinas, apartments, hotels and malls.

Chinese President Xi Jinping inaugurated the project during a visit in 2014.

However the project created disquiet in neighboring India over the possibility of China having outright land ownership.