Indo-Lanka talks to focus on infrastructure sector amongst others

Sai Nikesh | The Dollar Business India and Srilanka on Monday discussed economic cooperation, maritime security and bilateral investments, besides other aspects of bilateral relations and international issues. According to an official release, while expressing his support for a more balanced growth in trade between the two countries, the Prime Minister of India was quoted to have said, “President and I are committed to unlock the vast potential of our economic cooperation with Sri Lanka.” The PM expressed the Government of India’s readiness for furthering India’s investments in Sri Lanka and improved air connectivity to foster tourism ties with the island nation. Besides these, the Civil Nuclear Cooperation Agreement between the two nations has drawn the special attention and this was the first such agreement the island nation had made. The nuclear agreement is also expected to open ways for stronger cooperation in agriculture and healthcare sector. Both the sides have also entered into Memorandum of Understanding for the stronger trade in the agricultural sector, defence and security cooperation, which is expected to play a strategic role in the South Asia region. Referring to its assistance towards the construction projects in Sri Lanka like housing, under which it has already constructed more than 27,000 houses, the Indian side expressed its commitment to Sri Lanka in furthering its assistance in the infrastructure sector. Here it is noteworthy to mention that during Rajapaksa’s regime, Srilanka remained inclined towards infrastructure projects with China, which has been the island’s biggest financier. In view of this, India is also expected to seek clarity from Sri Lanka over the China-funded Colombo port city project, which was considered by India as a security threat to New Delhi. Even though the Sri Lankan president had quoted China’s projects in the island region as a trap, the Sri Lankan premiere also has plans underway to visit China. Following this visit of Sri Lankan President to India, Indian Prime Minister is also expected to visit Sri Lanka in March, marking the first-ever visit of an Indian PM to the island in 25 years. Modi, during his upcoming visit is expected to travel across Sri Lanka, including the North, where India has its own infrastructure initiatives in place, including a project to build 50,000 houses for war-displaced people, say the sources. Relations between Sri Lanka and India have picked up pace after the new President took over chair in the island nation. Earlier in January, Colombo has asked India to help Sri Lanka set up a Finance Intelligence Unit in the island nation. This FIU being setup by India is expected to aid Sri Lanka in tracing billions allegedly stashed overseas by the erstwhile Rajapaksa regime.  India was also expected to consider Lanka’s proposal seeking Reserve Bank of India’s expertise in tracing money allegedly hoarded in tax havens. Sri Lanka’s growing inclination towards India will definitely be an alert call for China, which has been moving closely with Sri Lanka, as a part of its power strategy in the Indian Ocean.  

This article was published on February 16, 2015.