OVERVIEW:

India and Sri Lanka enjoy a vibrant and multifaceted economic partnership, anchored by the India-Sri Lanka Free Trade Agreement (ISFTA) implemented in 2000, which has significantly boosted bilateral trade. India is Sri Lanka’s largest trading partner, with merchandise trade reaching 

5.45 billion in 2021 reflecting 482.2 billion, with investments in petroleum, tourism, manufacturing, and telecommunications. India also plays a pivotal role in Sri Lanka’s tourism sector, contributing the largest share of international tourists. Enhanced connectivity through air travel agreements, such as the Open Sky Agreement and air bubble arrangements, further strengthens people-to-people ties. Additionally, India has provided substantial concessional financing for infrastructure projects, particularly in railways, and supported Sri Lanka during its economic crisis through lines of credit for essential goods and fuel.

The partnership is further reinforced by bilateral agreements in areas such as agriculture, telecommunications, renewable energy, and civil nuclear cooperation. Initiatives like the South Asia Satellite and joint projects in science and technology highlight the depth of collaboration. India’s development assistance extends to water supply projects, renewable energy, and capacity-building programs, with over 400 Sri Lankan officials trained annually under the Indian Technical and Economic Cooperation (ITEC) program. Efforts to resume ferry services and develop regional connectivity, such as the Palaly Airport, underscore the commitment to restoring traditional links. Overall, the India-Sri Lanka relationship is a comprehensive blend of trade, investment, development cooperation, and cultural ties, aimed at fostering mutual growth and regional stability.

Sectors

1. Apparel
2. Auto Components
3. Electrical & Electronics
4. Food Processing
5. Information Technology
6. Logistics
7. Pharmaceuticals
8. Tourism and Leisure