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Lanka seeks more investments from India - Prof Peiris

Sunday Observer, Sri Lanka

Lanka seeks more investments from India - Prof Peiris

by Surekha Galagoda

Sri Lanka is seeking more investments from India in the sectors of Information Technology, tourism, spices, leather and ceramics.

29 April 2007

Minister of Export Development and Internal Trade Prof. G.L.Peiris inaugurating a program on the Indo Lanka Free Trade Agreement in Kochi said that it is high time that inhibitions and apprehensions about Sri Lanka were shed. Sri Lanka is an ideal investment destination in South Asia. Investing in Sri Lanka would mean better access to the huge European Union market which does not charge duty on over 200 goods from Sri Lanka.

He said that though there was considerable progress in bilateral trade since signing of the FTA in 2000 there were still some roadblocks. The program was organised by the Kerala Chamber of Commerce and Industry.

The main limitations in bilateral trade are the lack of symmetry and reciprocal attitude of India, its tough stand on non tariff barriers and lack of air connectivity between the two countries, said Prof Peiris.

When the FTA was signed there was considerable apprehension on both sides. The Indian business community worried mainly about Sri Lankan tea and their peers in my country were scared about the enormous size and capability of India. Finally they were proved wrong.

Prof. Peiris said that as a result of the agreement bilateral trade which had stood at $670 million prior to the agreement shot up to $2 billion in 2006.

He said that Indian investments in Sri Lanka had increased from $4 million to $150 million during the 2000-2006 period. Though bilateral trade still stood in favour of India the gap had come down from 20:1 to 4:1.

To further widen cooperation the two countries are moving towards the signing of a Comprehensive Economic Partnership Agreement (CEPA). We hope that it will be signed in the near future.

This will enhance the existing economic linkage between the two countries through liberalisation of trade in merchandise, services, investment and promotion of economic cooperation. India emerged as the third largest export market for Sri Lanka in 2006 accounting for about 7.2% of Lanka’s total exports overtaking Japan.

India became the largest supplier of Sri Lankan imports in 2001 and continues to remain in the same position.