Indo-Lanka trade trebles in Lanka's favour

by Anjana Samarasinghe

Bilateral trade between Sri Lanka and India have trebled during the last five years Indian High Commissioner Nirupama Rao said.

Speaking at the second Made in India show launch which will be held from September 22 to 26 at the BMICH, Rao said that bilateral trade which crossed the billion dollar mark in 2002 stood at 1.73 billion at the end of 2004.

"Indian exports amount to US $ 1.35 billion and Sri Lankan exports amount to US $ 382 million. "What is remarkable is that the trade balance in favour of India has declined from 15.7:1 in 1998 to 3.5:1 in 2004, demonstrating that Sri Lankan exports have grown much faster than India's and the result has been a more equitable trade expansion," Rao said.

India today is the largest source of Sri Lankan imports, followed by Singapore, Hong Kong and China. India is also the third largest export destination following US and UK. India is also the third largest investor in Sri Lanka," she said.

"While FTA was just the stepping stone, we are working towards graduating to a Comprehensive Economic Partnership Agreement (CEPA).

The economic advantages and complementarities offered by the Sri Lankan economy has attracted the attention of Indian industry and investors.

Preferential tax rates, constitutional guarantees on investments, exemption from exchange control, 100% repatriation of profits, permission fro 100% FDI, make Sri Lanka an investors delight. "The FTA with India and the recently implemented FTA with Pakistan open doors to two of the largest markets in the South Asian region.

The second "Made in India Show 2005" will bring together prominent Indian brands including Ashok Leyland, Tata Motors, Mahindra & Mahindra Kinetic Engineering, Hero Honda, Hero Cycles, TVS Auto Parts, Usha International, State Bank of India, Essar Steel, Escorts, Kirloskar Oil Engines, Kirloskar Copeland, Petroleum Conservation Research Association (PCRA).

The main aim is to build business linkages with their counterparts.

In addition to the exhibition, the "Made in India Show" will also include, a high level business delegation from India and a seminar on trade in services and economic cooperation.

Chairman of the Ceylon Chamber of Commerce Deva Rodrigo said that it is a good opportunity for Indian suppliers to showcase their products for Sri Lankan markets.

Exports from Sri Lanka to India and exports from India to Sri Lanka has grown in the past few years. Both countries should concentrate on services like finance, tourism and health services, he said.

Deputy Director General of CII Jayant Bhuyan said this year nearly 80 Indian companies will take part in the show. The Made in India show, which was held in 2003, was a huge success. There was a good response from the Indian industrialists for this event.