Sri Lanka, an island nation strategically located at the crossroads of maritime trade routes, shares a deep and enduring relationship with its closest neighbour, India. Rooted in history, culture, and economic ties, this relationship has evolved into a partnership of strategic significance. In fact, the Minister of Foreign Affairs, Vijitha Herath, recently stated that India has always stood by Sri Lanka as a close friend. The government of Prime Minister Narendra Modi, through his ‘Neighbourhood First’ policy and SAGAR (Security and Growth for All in the Region) framework, has further consolidated ties and expanded cooperation. Sri Lanka acknowledges India’s tremendous support during its economic crisis, including assistance with debt restructuring arrangements in collaboration with the IMF.
India’s lifeline during the crisis
Sri Lanka’s economic crisis in 2022 left the country grappling with severe shortages of fuel, medicine, and food. As the nation teetered on the brink of collapse, India stepped in with nearly $ 4 billion in aid, including credit lines for essential imports, currency swaps, and deferred loan repayments. This assistance not only stabilised the economy in the short term but also laid the foundation for deeper economic collaboration between the two countries.
India’s commitment did not end with emergency aid. It has since expanded its role, focusing on long-term recovery strategies, particularly in renewable energy, infrastructure development, and regional trade partnerships. These efforts underline India’s steadfast commitment to Sri Lanka’s economic stability and its broader vision of regional prosperity.
Transforming Sri Lanka’s energy sector
Energy security remains a pressing concern for Sri Lanka, and India has played a critical role in addressing this challenge. Renewable energy projects, particularly in the Northern and Eastern Provinces, have been a focal point of collaboration. Indian companies have invested in wind and solar farms, aiming to reduce Sri Lanka’s reliance on imported fuel while promoting sustainable energy solutions (Reuters, 2025a). The Indian Oil Corporation (IOC) has also expanded its footprint in Sri Lanka by upgrading fuel storage and distribution networks to bolster energy security.
However, recent developments have introduced complexities in this collaboration. Sri Lanka is now looking to renegotiate a $ 442 million power purchase agreement with India’s Adani Group. Despite this setback, India remains committed to energy cooperation, with plans to supply liquefied natural gas (LNG) to Sri Lanka and integrate the two nations’ power grids, enhancing regional energy stability (Reuters, 2025b).
Boosting tourism
Tourism, a vital pillar of Sri Lanka’s economy, has significantly benefited from India’s partnership. Indian tourists consistently represent the largest segment of international arrivals, drawn by Sri Lanka’s cultural heritage, pristine beaches, and natural beauty (Daily FT, 2025). Recognising the sector’s potential, both nations have simplified visa processes and collaborated to promote Sri Lanka as a prime travel destination for Indian tourists. These joint efforts have not only boosted visitor numbers but also provided much-needed revenue to Sri Lanka’s tourism-dependent regions. As the sector continues to recover, India’s role as a key source market for tourists highlights the mutual benefits of strengthening ties in this area.
Infrastructure development
Infrastructure development has been another cornerstone of India’s contributions to Sri Lanka’s recovery. Major projects funded by India, such as the modernisation of railway lines and the development of Kankesanthurai Harbour, have improved internal connectivity while enhancing trade routes with India (AP News, 2024). Additionally, both nations are actively working to finalise the Economic and Technology Cooperation Agreement (ETCA) to deepen economic ties and promote trade and investment.
After a five-year hiatus, negotiations resumed in Colombo in late 2023, where both sides reviewed progress and deliberated on key aspects, including trade in goods and services, customs procedures, and dispute resolution mechanisms (PIB, 2023).
Driving trade
India has consistently ranked as one of Sri Lanka’s largest trading partners, with bilateral trade exceeding $ 5 billion annually (Weerakkody, 2024). Sri Lanka’s apparel industry, a key export sector, heavily depends on Indian raw materials and machinery, which help maintain its competitiveness in global markets.
India’s role in Sri Lanka’s healthcare sector is equally significant, with the supply of affordable medicines and medical equipment meeting critical public health needs. Recent discussions have emphasised expanding trade ties through initiatives like ETCA and facilitating Indian Rupee-Sri Lankan Rupee trade settlements (Times of India, 2025).
Balancing regional dynamics
While India has been a reliable partner, China’s significant investments in Sri Lanka’s infrastructure have added complexity to the island’s foreign policy. For example, Sri Lanka recently fast-tracked a $ 3.7 billion oil refinery project with China in Hambantota, signalling Beijing’s deepening influence in the region (Reuters, 2025c). Striking a balance between these relationships will be crucial for Sri Lanka’s sovereignty and long-term economic sustainability.
Conclusion
India’s contributions to Sri Lanka’s recovery underscore the strength and depth of their bilateral relationship. From providing critical financial assistance during the economic crisis to investing in energy, trade, tourism, and infrastructure, India has proven to be an indispensable partner.
As Sri Lanka continues on its path to recovery with a new Government, deepening its partnership with India will be essential. By leveraging India’s support and fostering collaboration across key sectors, Sri Lanka can unlock new opportunities and fast-track its economic growth.
References:
Reuters, 2025a. Sri Lanka revokes power purchase deal with Adani Group, AFP reports. [online] Available at: https://www.reuters.com/markets/deals/sri-lanka-revokes-power-purchase-deal-with-adani-group-afp-reports-2025-01-24/ [Accessed 24 Jan. 2025].
Reuters, 2025b. Sri Lanka agrees with China’s Sinopec to fast-track $3.7 billion refinery. [online] Available at: https://www.reuters.com/world/asia-pacific/sri-lanka-china-agree-fast-track-sinopecs-37-bln-refinery-hambantota-2025-01-22/ [Accessed 24 Jan. 2025].
Daily FT, 2025. India and Sri Lanka usher 2025 with deepened partnership: Jha. [online] Available at: https://www.ft.lk/front-page/India-and-Sri-Lanka-usher-2025-with-deepened-partnership-Jha/44-771521 [Accessed 24 Jan. 2025].
Press Information Bureau (PIB), 2023. India and Sri Lanka re-launch negotiations of the Economic and Technology Cooperation Agreement (ETCA). [online] Available at: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1973859 [Accessed 24 Jan. 2025].
Times of India, 2025. India, Sri Lanka eye deeper trade, investment collaboration. [online] Available at: https://timesofindia.indiatimes.com/india/india-sri-lanka-eye-deeper-trade-investment-collaboration/articleshow/116371166.cms [Accessed 24 Jan. 2025].
Weerakkody, D., 2024. India and China key for Sri Lanka’s full recovery. Daily FT, [online] Available at: https://www.ft.lk/dinesh-weerakkody/India-and-China-key-for-Sri-Lanka-s-full-recovery/5-767754 [Accessed 24 Jan. 2025].
(The writer teaches Accounting and Finance at University of Buckingham UK.)
February 13, Colombo (LNW): A significant meeting was recently held to review the Action Plan of Sri Lanka’s Women Parliamentarians’ Caucus, led by Prime Minister Dr. Harini Amarasuriya and the Chairperson of the Caucus, Minister of Women and Child Affairs, Saroja Savitri Paulraj.
The gathering, which took place on February 07, focused on several key initiatives aimed at strengthening the role of women in governance and enhancing their representation across various political levels.
One of the main discussions centred on achieving 25 per cent female representation at the provincial level. The Caucus deliberated on the legal amendments needed to bring this proposal to fruition, with a focus on ensuring that women have an equal and active role in the upcoming elections.
It was agreed that the next steps would involve pushing for amendments to current laws to pave the way for this goal.
Further discussions were held around the importance of engaging with political parties to advocate for greater female representation in provincial and local government bodies.
The Caucus decided to meet with party leaders and secretaries to press for the appointment of more women to key positions in these sectors, aiming to increase their visibility and influence in decision-making processes.
In addition to these legislative and political advancements, the meeting also addressed pressing social issues such as the elimination of sexual harassment in the workplace and the need to tackle Sexual and Gender-Based Violence (SGBV).
The Caucus members agreed to continue their work in promoting safer and more inclusive environments for women across the country.
Plans for International Women’s Day, set to be observed on March 08, were also discussed, with the aim of using the occasion to raise awareness and drive further action on the issues affecting women in Sri Lanka.
The meeting was attended by Deputy Co-Chairpersons of the Caucus, including Parliamentarians Chamindrani Kiriella, Samanmali Gunasinghe, Rohini Kumari Wijerathna, Geetha Herath, Sagarika Athauda, Kaushalya Ariyarathne, Oshani Umanga, Krishnan Kalaichelvi, Nilanthi Kottahachchi, M.A.C.S. Chathuri Gangani, Nilusha Lakmali Gamage, A.M.M.M. Rathwaththe, Deepthi Wasalage, Hiruni Wijesinghe, Ambika Samivel, and Lakmali Hemachandra.
February 13, Colombo (LNW): Adani Green Energy, a subsidiary of the Indian conglomerate Adani Group led by billionaire Gautam Adani, has announced its decision to withdraw from a planned wind energy project in the Mannar region of Sri Lanka.
The decision marks a significant shift for the company, which had previously aimed to contribute to Sri Lanka’s renewable energy efforts.
In an official statement, a spokesperson for the Adani Group confirmed that the company’s board had communicated its decision to the Sri Lankan authorities.
Whilst the withdrawal from the wind energy venture represents a setback for the project, the group clarified that it remains committed to strengthening ties with Sri Lanka and is open to exploring future opportunities for collaboration, should the Sri Lankan government seek their involvement.
Despite this change in direction, the Adani Group expressed its continued interest in contributing to Sri Lanka’s energy landscape, suggesting that future projects may still be on the cards if aligned with the government’s long-term energy goals.
February 13, Colombo (LNW): Following the imposition of a one-hour power cut this evening (13), the Ceylon Electricity Board (CEB) has released the demand management schedule approved by the Public Utilities Commission of Sri Lanka (PUCSL).
This one-hour power cut will be in effect between 5.00 p.m. and 9.30 p.m. this evening.
February 13, Colombo (LNW): In a significant development in the ongoing investigation into the murder of Sri Lankan journalist Lasantha Wickrematunge, the Attorney General (AG) has informed the Mount Lavinia Magistrate’s Court that a recent recommendation regarding the suspects will be temporarily suspended.
The AG communicated this decision in writing to the court today (13).
The recommendation in question pertains to a legal advisory issued by the Attorney General to the Criminal Investigation Department (CID) concerning three individuals who had been identified as suspects in the high-profile case, including a military intelligence officer.
These suspects had been under scrutiny as part of the investigation into the brutal killing of Wickrematunge in 2009, a crime that has remained unresolved for many years.
In his earlier communication, dated January 27, the Attorney General had advised the CID on the potential release of the suspects, an action that has now been put on hold.
The suspension comes amid growing public interest and concern over the case, with many calling for a thorough and transparent investigation into the murder, which has remained a critical point of contention in Sri Lanka’s media history.
February 13, Colombo (LNW): The Welfare Benefits Board has announced that the February installment of Aswesuma funds will be credited to the bank accounts of eligible beneficiaries today (13).
This timely payment is part of the ongoing commitment to support vulnerable families across Sri Lanka.
A total of 1,725,795 households are set to receive financial assistance through the Aswesuma programme, which aims to alleviate the economic pressures faced by low-income families.
In total, the government has allocated more than Rs. 12 billion to ensure that these families can continue to access the support they need during challenging times.
The disbursement of funds will provide a crucial lifeline to many households, helping to meet basic needs such as food, healthcare, and education.
February 13, Colombo (LNW): A sub-committee has been established under the Ministry of Provincial Councils and Local Government to thoroughly investigate and resolve ongoing issues concerning transfers and recruitment within local government institutions across Sri Lanka.
The committee, which has been formed as part of the advisory board’s mandate, will focus on addressing inefficiencies and challenges that have affected the smooth functioning of these bodies.
The sub-committee will be led by Deputy Minister Ruwan Senarath, who expressed confidence that this initiative would bring much-needed clarity and improvements to the processes within local councils and provincial institutions.
The committee’s scope includes reviewing existing practices, identifying systemic flaws, and recommending reforms to streamline recruitment and transfer protocols in a way that benefits both public servants and the citizens they serve.
According to Deputy Minister Senarath, numerous concerns have already been highlighted in various provincial councils and local government bodies, many of which have struggled with issues related to unfair practices and delays in staff management.
He noted that the formation of this sub-committee marks a decisive step towards ensuring transparency, accountability, and efficiency in the recruitment and transfer processes.
It is expected that the findings of this investigation will inform future policy decisions and lead to substantial improvements in the way local government bodies operate, particularly in terms of workforce management.
February 13, Colombo (LNW): The Government Medical Officers’ Association (GMOA) has revealed that a significant exodus of medical professionals is underway, with 2,000 doctors having already left Sri Lanka’s health services, and an additional 5,000 expected to follow suit in the near future.
Dr Chamil Wijesiri, a spokesperson for the GMOA, highlighted the potential ramifications of this mass departure, including critical shortages in medical personnel and drug supplies.
He stressed that these doctors, having completed all necessary qualifications and training, are seeking opportunities abroad, where better conditions and financial incentives await them.
The departure of so many medical professionals is exacerbating the already strained healthcare system, which faces challenges not only in staffing but also in securing essential medical supplies.
Dr Wijesiri warned that the shortage of drug suppliers is one of the many pressing issues that could arise from the outflow of such a large number of qualified doctors.
In response to these challenges, Dr Wijesiri called on the government to take immediate action to protect the remaining medical staff in the country and to stabilise the national economy.
He emphasised the need for short-term solutions to address the current crisis and expressed hope that the upcoming budget proposal would introduce the necessary changes to prevent further deterioration of the healthcare system.
The situation paints a worrying picture for Sri Lanka’s healthcare sector, as the exodus of qualified doctors not only undermines the country’s ability to provide adequate medical care but also reflects the broader economic and social difficulties that many professionals are facing.
February 13, Colombo (LNW): At the World Governments Summit held in the United Arab Emirates on Tuesday (11), President Anura Kumara Disanayake held an important meeting with Mike Sicilia, Executive Vice Chairman of Oracle Corporation.
The two leaders engaged in a constructive discussion centred around advancing Sri Lanka’s digital transformation, particularly in the fields of financial technology (fintech), cloud infrastructure, and governance.
The conversation primarily focused on how Oracle could assist Sri Lanka in adopting cutting-edge digital technologies to drive economic growth and enhance the efficiency of government services.
Oracle expressed its readiness to support Sri Lanka’s digitalisation ambitions, particularly through the provision of Oracle Cloud Infrastructure (OCI), a platform that would help modernise the country’s IT framework. In response, President Disanayake proposed the establishment of a sovereign Oracle Cloud region in Sri Lanka.
This initiative would provide a secure and efficient platform for hosting government applications, e-governance services, and a comprehensive national data system, ensuring that the country maintains control over its data sovereignty and remains compliant with international regulations.
In line with Sri Lanka’s efforts to transition to a cashless economy, President Disanayake also extended an invitation to Oracle to help lay the groundwork for innovative fintech solutions and digital payment systems.
The President further proposed the creation of a Digital Transformation Hub in Colombo Port City, with a focus on Artificial Intelligence (AI) and cloud technologies.
He envisions this hub becoming South Asia’s leading centre for AI-driven innovation, which could boost Sri Lanka’s role in the region as a technology and digital services hub.
The President invited Mr. Sicilia to send a dedicated team to Sri Lanka to explore the feasibility of these initiatives and help expedite the process of setting up Oracle’s South Asian AI and Cloud Hub in Colombo Port City.
He expressed confidence that such a move would help position Sri Lanka as a regional leader in the field of digital transformation, fostering greater public-private partnerships and attracting investments in high-tech solutions.
Mike Sicilia, in response, expressed a keen interest in Oracle’s potential involvement in Sri Lanka’s digital evolution. He emphasised the strategic importance of establishing an AI and Cloud Hub in the country, which would not only accelerate the nation’s technological growth but also attract investments in state-of-the-art technologies.
He acknowledged the significant role Sri Lanka could play as a regional leader in AI-driven cloud solutions.
During the meeting, President Disanayake reaffirmed Sri Lanka’s commitment to embracing new technologies that would streamline governance, boost economic development, and enhance the country’s global competitiveness.
He stressed the importance of international partnerships to support the nation’s ambitious digital transformation agenda and welcomed Oracle’s potential contribution to the country’s future.
The discussions were attended by Minister of Foreign Affairs, Foreign Employment, and Tourism, Vijitha Herath, as well as Hanif Yusoof, Governor of the Western Province, who also participated in the talks, highlighting the broader political support for the digitalisation initiatives.