India’s Bilateral Relations with Sri Lanka

India and Sri Lanka have a legacy of intellectual, cultural, religious and linguistic interaction which is 2,500 years old. In recent years, the relationship has been marked by close contacts at all levels. Trade and investment have grown and there is cooperation in the fields of development, education, culture and defence.

Recent Developments

  • India continued to support Sri Lanka's developmental needs through development partnership projects, including training, capacity building programmes, provision of expertise, Lines of Credit (LoC) and grants.
  • So far, close to US$ 500 million have been provided as grants to Sri Lanka. There was significant progress in the implementation of developmental assistance projects.
  • Construction of around 45,500 houses under the flagship Housing Project has been completed. The next phase to construct 4,000 houses in the Central and Uva Provinces through an innovative community-driven approach is underway.
  • India assisted Sri Lanka in a large number of Small Development Projects in areas of education, health, transport connectivity, small and medium enterprise development and training across the country under grant assistance.
  • New buildings have been constructed for faculties of Agriculture and Engineering of Jaffna University. The foundation stone for construction of a Trilingual National School in Polonnaruwa was laid in 2017.
  • Memoranda of Understandings for new Small Development Projects viz. construction of 153 houses in Sobitha Threo Village in Anuradhapura; Upgradation of Vocational Training Centre in Hatton; Upgradation of Saraswarhy Central College in Pusselawa, Kandy; construction of 600 houses under Model Village Housing Project in 25 districts of Sri Lanka and Gram-Shakti Housing Project to construct 600 houses in Southern Province of Sri Lanka were signed during the period.

Fishermen Issue

  • Both countries are separated by the International Maritime Boundary Line (IMBL). Given the proximity of the territorial waters of both countries, especially in the Palk Straits and the Gulf of Mannar, incidents of straying of fishermen are common.
  • One of the major reasons complicating the issue is of Kachchatheevu Island.India ceded the uninhabited island to its southern neighbour in 1974 under a conditional accord.
  • Tamil fishermen believe that Kachchatheevu is traditionally their territory and so they have a right to fish there.The Sri Lankan authorities believe that this endangers the livelihood of Sri Lankan fishermen.
  • India and Sri Lanka have agreed to set up a Joint Working Group (JWG) on Fisheries and hotline between their Coast Guards.
  • LoC Agreement of USS 318 million for procurement of railway rolling stock and upgradation of rail tracks was signed in June 2017. Contract agreements for procurement of rolling stock for US$ 100.55 million and for procurement of 20 Container Carrier Wagons and 30 Fuel Tank Wagons for around US$4.27 million were also signed in 2017.
  • Another LoC Agreement of US$ 45.27 million was signed on 10 January 2018 in New Delhi to rehabilitate Kankesanthurai Harbour into a commercial port, which is expected to ensure further economic integration between the two countries.

India’s Bilateral Relations with Sri Lanka

The nearly three-decade long armed conflict between Sri Lankan forces and the LTTE came to an end in May 2009. The need for national reconciliation through a political settlement of the ethnic issue has been reiterated by India at the highest levels. India’s consistent position is in favour of a negotiated political settlement, which is acceptable to all communities within the framework of a united Sri Lanka and which is consistent with democracy, pluralism and respect for human rights.

In recent years, significant progress in implementation of developmental assistance projects for Internally Displaced Persons (IDPs) and disadvantaged sections of the population in Sri Lanka has helped further cement the bonds of friendship between the two countries.

Commercial Relations

The economic relations between the two countries have opened up only since the end of the Cold War. Sri Lanka was, as a matter of fact, the first South Asian economy to go for liberalization way back in 1978. By the end of the Cold War, trade began to increase with India as India liberalized its economy. Both have tried to rectify trade practices through a Free Trade Agreement (FTA). India and Sri Lanka signed the FTA in 1998, which finally became operational in 2001. The India–Sri Lanka FTA gives duty free preferential access to each other’s goods in a time-bound manner.

  • Exports: India exports petro products, pharmaceuticals, two wheelers and vegetables
  • Imports: India imports rubber products, spices and electric wires.

Sri Lanka is currently India’s largest trade partner in South Asia and bilateral trade has reached nearly US$ 5 billion. India has also emerged as the number one source country as far as Foreign Direct Investment and tourist arrivals are concerned.

Bilateral Investment

  • India is also undertaking development of the ‘Trincomalee port’ as this will boost its strategic presence vis-à-vis Sri Lanka.
  • The Airports Authority of India (AAI) is also about to enter a deal with Sri Lanka Civil Aviation (CAA) Authority to run the Mattala Rajapaksha International Airport (MRIA) at Hambantota; where AAI is to have 70% stake while Sri Lanka CAA will invest 30%.
  • Indian firms operational in Sri Lanka include Tata, Jet Airways, Ashoka Leyland, Ceat, Apollo, etc.

e-TV scheme

  • Government of India formally launched the e-Tourist Visa (e-TV) scheme for Sri Lankan tourists on 14 April 2015.
  • In 2016, of the 2 million total tourist arrivals to Sri Lanka, 357,000 were from India constituting 14% of the total number of tourist arrival to Sri Lanka.
  • Sri Lankan tourists too are among the top ten sources for the Indian tourism market. In 2016, around 215,000 visas were issued by the High Commission and other posts in Sri Lanka to facilitate travel between Indian and Sri Lanka.

Developmental Cooperation

India assists on a large number of smaller development projects in areas like education, health, transport connectivity, small and medium enterprise development and training in many parts of the country through its grant funding.

  • To mitigate the recent drought in Sri Lanka, India has donated 08 lorry mounted water bowsers to Sri Lanka on 21 March 2017 as well as 100 metric tons of rice in May 2017.
  • During the devastation of floods in the end of May 2017, India has responded immediately by sending three ships with relief materials including food supplies, water, inflatable boats, diving team and medical teams for flood relief efforts.

Cultural Relations

The Cultural Cooperation Agreement signed by the Government of India and the Government of Sri Lanka on 29 November, 1977 at New Delhi forms the basis for periodic Cultural Exchange Programmes between the two countries.

  • On 21 June 2015, the First International Day of Yoga was celebrated at the iconic ocean side promenade Galle Face Green.
  • In 2016, a similar event was organized at Mahavihara Devi Park to celebrate International Day of Yoga.
  • Afestival of India in Sri Lanka was launched in November 2015, with ‘Nrityarupa’, a scintillating dance medley from different parts of India performed in Colombo, Kandy and Galle. The theme of the Festival was “Sangam”: a confluence of cultures of India and Sri Lanka.
  • India and Sri Lanka commemorated the 2600th year of the attainment of enlightenment by Lord Buddha (Sambuddhatva Jayanthi) through joint activities. These included the exposition of Sacred Kapilavastu Relics in Sri Lanka that took place in August – September 2012.
  • The Indian Gallery at the International Buddhist Museum, Sri DaladaMaligawa, was inaugurated in December 2013.
  • The two Governments jointly celebrated the 150th Anniversary of Anagarika Dharmapala in 2014.
  • Indian Prime Minister during his visit to Kandy on 12 May 2017, laid the foundation stone for the faculty of Kandyan Dance at the Sri Lankan International Buddhist Academy.

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