‘India now our largest supplier’

‘No change in Lanka’s liberal market policies’–Rishad to India

• ‘We praise Sri Lanka’s new outlook!’- Indian Dep High Comm Bagchi
• ‘India now our largest supplier’-Rishad
• 2013 total trade tops $3.6 Bn
• ‘Time to expand to investments & services’-Indian Dep High Comm Bagchi
• Balance of trade narrows in Lanka’s favour to $2.54 Bn!

Rishad Bathiudeen (Minister of Industry and Commerce of Sri Lanka-centre) greets Arindam Bagchi (Deputy High Commissioner of India to Sri Lanka-right) as RDS Kumararatne (DG-Department of Commerce of Sri Lanka-left) looks on at Ministry of Industry and Commerce on 27 January.

There is no change whatsoever in Sri Lanka’s international or domestic trade positioning due to the arrival of new government-rather, it stands strengthened even more, as assured by Sri Lanka on 27 January in Colombo. “We pledge that there is no change in Sri Lanka’s liberal market policies by the new government of HE the President Maithripala Sirisena-rather, our determined market economy outlook is strengthened even further by HE the President’s new policies!” stressed Rishad Bathiudeen (Minister of Industry and Commerce of Sri Lanka) on 27 January in Colombo.

Minister Bathiudeen was addressing Arindam Bagchi (Deputy High Commissioner of India to Sri Lanka) who was making a courtesy call on Minister Bathiudeen on the eve of 27 January at the Ministry of Industry and Commerce, Colombo 3. Joining Minister Bathiudeen was RDS Kumararatne (DG-Department of Commerce) functioning under Minister Bathiudeen.

“Indo-Sri Lanka relations have been historic and diverse and with the new changes in Sri Lanka, relations can move towards new and stronger levels. The new government led by HE the President Maithripala Sirisena and Hon Prime Minister Ranil Wickremesinghe is in a real, genuine path for economic engagement and we praise this determined outlook” said Deputy High Commissioner Bagchi and added: “Also, a high level visit from India to Sri Lanka is now pending but still to be confirmed. In recent times we have jointly held 13 rounds of trade talks to smoothen bilateral trade and the results are now clearly evident as total bilateral trade has increased considerably. It is now time to expand from our current goods trade to investment and service exchanges as well. We are very keen to expand trade in these new ways. The great bilateral trade dispute resolution mechanism we now have is one of the leading advantages of Indo-Lanka FTA.”

According to the Department of Commerce of Sri Lanka, in 2013, total trade between two countries stood at $3.63 Bn. Exports from Sri Lanka to India stood at $543.3Mn while total imports from India was at $3.09Bn. More than 60% of Sri Lanka’s exports to India were under Indo-Sri Lanka Free Trade Agreement (ISFTA). Since ISFTA started in Y2000, Lankan exports to India surged by almost eightfold by 2013.

Responding to Deputy High Commissioner Bagchi, Minister Bathiudeen said: “In the era of the new government of HE the President Maithripala Sirisena, and the support of our Foreign Minister Mangala Samaraweera, Sri Lanka is looking forward to a much stronger trade and bilateral engagement with our historic neighbour India in multiple spheres. We assure that there is no change in Sri Lanka’s liberal market policies by the new government of HE the President Maithripala Sirisena-rather, our determined market economy outlook is strengthened even further by HE the President’s new policies! The Indo-Sri Lanka Free Trade Agreement (ISFTA) now works very well –so much so India has now become the number one product supplier to Sri Lanka. Once the remaining issues of some of our current exporters to India are resolved, we can move towards a broader economic engagement as you request. As my DG-Commerce RDS Kumararatne here informs me, tariff liberalisation alone will not create market access for Sri Lanka in international markets. It needs to be supported by the removal of Non-Tariff Barriers (NTBs) too.”

Deputy High Commissioner Bagchi stressed: “In order to strengthen this engagement further and move forward, we would like to see a Commerce Secretarial level delegation to come here and meet you in the not too distant future. As for NTB issues raised by Sri Lanka from time to time, I am happy to inform you that the Government of India has now started a new process of custom tariff and local procedures harmonisation, at state-to-state levels so that Lankan exports increase to India across various states are sustained so that balance of trade could be improved for Sri Lanka.”

The balance of trade always remained in favour of India due to the increased outlay on major import items from India, such as petroleum products, automobiles, cotton, sugar etc. The unfavorable balance of trade narrowed to $2.54 Bn in 2013, from $2.95 Bn in 2012.

In response, Minister Bathiudeen said: “We are positive that Indian trade system will, jointly working with Lankan officials, assist to lift such NTBs and expand current trade volumes. Both HE the President Maithripala Sirisena, and Foreign Minister Mangala Samaraweera are keen to move forward bilateral trade and mutual relations with India. We also welcome an official Secretary level delegation in the near future and I have instructed my DG-Commerce and Ministry Secretary SS Miyanawala to take these meetings forward.”

The second meeting of commerce secretary level talks between India and Sri Lanka was held in January 2014 in New Delhi, India.

CONCLUDED