Sri Lanka is keen to upgrade the Indo-Lanka Free Trade Agreement into a comprehensive economic and technological partnership, President Ranil Wickremesinghe said on Friday, asserting that the work which started in 2018 and 2019 has not found much progress.
The Free Trade Agreement (FTA) between India and Sri Lanka was the first-ever bilateral trade agreement for both countries, signed in 1998 and enforced in 2000. The pact is aimed at further boosting the economic ties between the two countries by liberalising trade norms.
“Sri Lanka and India gradually have to wean themselves out of the barriers to investment and the non-tariff barriers to trade especially in relation to Sri Lanka Indo economic relations,”
Wickremesinghe said while addressing a gathering of the Sri Lanka-India Society to mark the 75th anniversary of Indian Independence.
He said the future relations of India with its neighbours will be determined by trade integration.
“Trade integration gives an economic base. The common economic base is a prerequisite for better national security and better political relations,” he said.
The first such step would be to revive and upgrade the FTA into a comprehensive economic and technological partnership. The FTA-related work which started in 2018 and 2019 has not found much progress, he said.
Wickremesinghe said the second step was to look at all the projects which India and Sri Lanka had agreed to, but got delayed at the Sri Lankan end.
Two key such projects are the power grid connection between India and Sri Lanka, offshore wind energy, a solar power plant at Sampur in the eastern province and renewable energy projects on three islands of Jaffna in the north, he said.
“We have a tremendous scope of potential renewable energy, and India has stepped in first. There’ll be others. But from Puttlam to Mullativu, if we exploit renewable energy and go in for green hydrogen and also provide power to India, you will see the upliftment of the Northern economy, which had not happened earlier.
“The big impact on the northern economy and the implementation. Then we come to promoting Indian higher education institutes to come into Sri Lanka, especially Jaffna is one area we have identified, again another development,” he said.
Wickremesinghe referred to the Trincomalee oil storage tank farm development with India.
“We are developing logistics because of the fact that we are one of the main ports for India and Bangladesh. So together with India, Adani Group has already taken over part of the West terminal of the south port,” he said.
Adani Group sealed a deal with Sri Lanka to develop and run the strategic Colombo Port’s Western Container Terminal in September last year.